[dragonwriter]

> Yeah, except for one massive pitfall that student loans have and ISAs don't: With ISAs you only start to pay once you actually start making money

That's not that different from federal student loans, since those all have income-contingent repayment plans (as well as pay as you earn, revised pay as you earn, and income-based, which are generally similar but have different repayment formulas) available. It mainly differs in the reduced flexibility with the ISA.

> If the graduates of the Lambda school don't land jobs then the school doesn't get paid.

ISAs are marketable assets and can be sold even while the student is still in the program, and the school gets paid by selling the asset. The new holder of the asset doesn't get paid if the student doesn't make money.