Q&A

Yrefy SLP4, LLC, a Delaware limited liability company (the “Issuer”), is offering the private placement promissory notes (the “Notes”) to certain accredited investors in an exempt offering described in the Confidential Private Placement Memorandum. Investors who are accepted will become investors of the Issuer.

The Issuer is part of a group of affiliated entities collectively referred to as “Yrefy.” These affiliates support different functions of the overall business model:

• Yrefy, LLC – serves as the collateral agent

• Yrefy SLP4, LLC – the Issuer of the promissory notes

• Yrefy SLP5, LLC – originates and services loans

Throughout these FAQs and related materials, the term “Yrefy” may refer to the Issuer or one of its affiliated entities, depending on the context. Where distinctions are important, the specific entity name is used for clarity.

A Regulation D Rule 506(c) private placement is a type of exempt offering that is regulated under federal securities laws. They allow a privately held company to raise capital from accredited investors.

Under this rule, the companies may publicly advertise or promote their offering, provided that all investors are verified as accredited and that the company complies with applicable requirements of the U.S. Securities and Exchange Commission (SEC).

Investors in a private placement receive restricted securities. These restricted securities cannot be resold without meeting certain conditions and/or holding periods, as regulated by securities laws. Although these offerings are exempt from SEC registration, they are subject to oversight under federal and state securities laws.

Yrefy SLP4, LLC’s offering is conducted under this exemption. This is described in detail in the Private Placement Memorandum (PPM).

Private placement promissory notes are debt instruments that are used in non-public offerings to raise capital from accredited investors. With this type of offering, the issuing company promises to repay the principal along with interest to investors on a set schedule.

In this offering, Yrefy SLP4, LLC is the borrower, and the accredited investor is the lender. The promissory note serves as evidence of the debt and outlines key details, including the loan amount, interest rate, repayment schedule, and signatures of both parties.

If the borrower does not meet its repayment obligations, the note may be used in legal proceedings to enforce repayment under applicable law.

Investing in a private placement promissory note involves significant risk. These investments are not suitable for all investors. They are long-term, illiquid investments that are not traded on any public market. Investors should be prepared to hold them to maturity.

These investments are speculative in nature, and there is no guarantee of returns or repayment. Investors might lose some or all of their principal investment. The notes are not subject to the same regulatory requirements as publicly traded securities; however, they do remain subject to federal and state securities law oversight.

Investors should carefully review the “Risk Factors” section of the PPM for a disclosure of all material risks before investing.

Yrefy SLP4, LLC (the “Issuer”) offers fixed-rate promissory notes. Eligible accredited investors may select from five note classes. As outlined in the PPM, the notes have terms ranging from 12 to 60 months and fixed annual interest rates from 6.50% to 10.25%. Each class also has a defined maturity date and interest rate, and investors may allocate capital across one or more classes.

Upon maturity of a shorter-term note (Classes 1–4), investors may have the option to reinvest their principal and any accrued unpaid interest into a longer-term class with a corresponding higher fixed rate, subject to the terms outlined in the PPM.

‍ ‍An accredited investor, as defined by the SEC, is an individual or entity that meets specific financial or professional standards. This allows them to participate in investments that are not registered with the SEC. Examples of these include: private placements, hedge funds, and specific venture capital offerings.

Individuals generally qualify if they:

• Have earned at least $200,000 in annual income (or $300,000 jointly with a spouse or spousal equivalent) in each of the last two years, with a reasonable expectation of the same or higher income in the current year; or…

• Have a net worth exceeding $1 million, either alone or with a spouse, excluding the value of their primary residence.

Yrefy SLP4, LLC follows SEC guidelines for verifying accredited investor status in connection with this offering. You can learn more about these requirements on the SEC’s accredited investor page.

SEC Accredited Investors – Updated Investor Bulletin

In addition to meeting the SEC’s criteria, investors must be U.S. citizens with a valid Social Security Number (SSN), or a U.S.-based entity with a valid Tax Identification Number (TIN) to participate in Yrefy SLP4, LLC’s offering.

The minimum investment required is $50,000. Managers may waive the $50,000 investment minimum for qualified and interested parties at their sole discretion.

Investors may choose to either receive interest payments monthly, allow interest to accrue and be paid at the note’s maturity, or a combination of the two, split by percentage. Interest payments, although not guaranteed, follow the schedule described in the note.

Elections may be changed monthly through the Yrefy Investor Portal. Depending on the selected option, interest payments are made to investors by wire transfer, check, or ACH, or are accrued in accordance with the investor’s instructions.

For those who elect monthly payments, interest is paid monthly in arrears by the 15th day of the following calendar month. Monthly payments consist of interest only. The return of principal occurs at the end of the selected note’s term, unless the investor elects to roll forward into a new class.

If you choose to have interest accrue, it is scheduled to accumulate over the term of the Promissory Note. Any accrued interest is generally paid together with the principal at maturity. Interest accrues only on the original investment amount throughout the term of the Promissory Note. Interest is calculated on a 365-day year basis (366 days during a leap year), based on the unpaid balance of the initial principal investment amount.

No -- once a note has been funded, additional principal cannot be added to that investment. However, you may open a new note at any time, each with its own principal amount, note class, and maturity date.

At the end of your term, you may choose to “roll forward” your note at maturity by providing written instructions or submitting your request through the Yrefy Investor Portal before the maturity date is reached.

When rolled forward, any accrued unpaid interest will become part of the new principal balance. You may elect to roll forward into one or more of the available note classes, in 1% increments, subject to the maximum term permitted under the program.

For example, an investor holding a one-year Note may elect at maturity to roll forward into a two-year class. In that case, the interest accrued during the first year becomes earned at maturity and is added to the principal amount for the new term. The applicable interest rate for the two-year class would then be applied to the duration of the extended term.

Any early withdrawal during the new term, or a surrender calculation, will be based on the remaining time in the new term, not on the original one. For full details and examples, review the PPM.

Early withdrawals are only permitted with the Issuer’s approval. If approved, the Issuer will return the principal and any vested interest, minus a redemption penalty. This is based on the duration of the investment.

Requests are reviewed on a first-come, first-served basis and may be delayed or declined at the Issuer’s discretion. Interest will continue to accrue until the withdrawal date, if any delay occurs. Please check out the PPM for all terms.

‍The company’s ability to offer fixed returns is based on its business model and underwriting process. Yrefy SLP5, LLC settles and pays off delinquent private student loans at negotiated discounted rates.  Loans are then refinanced at full face value, into a new loan with custom terms built around the borrower’s ability to pay. Similarly, Ignyte, the Alternative Education Refinance Product, offers students interested in attending Trade and Technical Schools an affordable financing option. In this process, Yrefy SLP5, LLC, and the school share the risk on each student borrower, with a similar discount applied at the time the borrower enrolls in the school.

Investor returns are fixed by class but are not guaranteed. Review the PPM for all details regarding rates, terms, and associated risks.

No -- the Notes are subject to a Security Agreement that gives investors limited rights through an affiliated collateral agent arrangement. This agreement does not make this investment risk-free or ensure repayment. Investors should review both the Security Agreement and the risk factors in the PPM for complete details.

If Yrefy SLP4, LLC fails to make a scheduled payment or meet an obligation, it may constitute an Event of Default. The company has 60 days to bring payments current once notified. If not cured, a default interest of 2.5% above the stated note rate may apply.

The Notes are subject to a Security Agreement between the Issuer (Yrefy SLP4, LLC) and Yrefy, LLC (the acting Collateral Agent). Under this agreement, the Issuer pledges certain assets, including its deposit accounts and cash, as collateral.

Investors are not parties to the Security Agreement and therefore have limited rights under it. The Collateral Agent is affiliated with the Issuer and may face potential conflicts of interest when carrying out its duties.

In the event of a default, the Collateral Agent may take actions described in the Security Agreement to protect investors’ collective interests. However, this arrangement does not guarantee repayment or eliminate investment risk. Investors should review the Security Agreement and related risk factors in the PPM for complete details.

Yrefy does not charge ongoing management or account fees. However, a redemption penalty may apply if funds are withdrawn before the note’s maturity date. Additional details are provided in the PPM.

Net proceeds from the sale of notes, after dealer fees, commissions, and reimbursements, are used for offering expenses, loan refinancing, operations, marketing, and other corporate purposes at the Managers’ discretion.

Investors who participate through a self-directed IRA, third-party custodian, or professional advisor (such as a CPA, attorney, or financial advisor) may incur additional fees charged by those third parties. These external costs are the responsibility of the investor and are not charged by Yrefy.

Interest income from the notes is generally treated as ordinary income for non-qualified accounts (such as individual, joint, or trust accounts). Investors typically receive a Form 1099-INT by January 31 of the following year.

Investors may also participate through a self-directed IRA or other eligible retirement account that permits private placement investments. In these cases, Yrefy does not report taxes directly to the IRA custodian.

Yrefy does not provide tax advice or endorse specific custodians. Investors should consult their CPA, tax advisor, or IRA custodian for guidance on the appropriate reporting and tax treatment for their individual situation.

Interest income from the notes is generally treated as ordinary income for non-qualified accounts (such as individual, joint, or trust accounts). Investors typically receive a Form 1099-INT by January 31 of the following year.

Investors may also participate through a self-directed IRA or other eligible retirement account that permits private placement investments. In these cases, Yrefy does not report taxes directly to the IRA custodian.

Yrefy does not provide tax advice or endorse specific custodians. Investors should consult their CPA, tax advisor, or IRA custodian for guidance on the appropriate reporting and tax treatment for their individual situation.

Yes -- in addition to refinancing distressed private student loans, Yrefy has introduced Ignyte by Yrefy. This is an initiative focused on originating new education loans, primarily for students attending trade and vocational schools.

This program aims to expand Yrefy’s efforts to promote financial access and responsible lending practices within the private education financing sector. Loan origination and underwriting under the Ignyte program are conducted with the same focus on assessing borrower eligibility and repayment capacity.

Sometimes, students turn to private student loans because federal aid may not cover all education costs. Tuition, housing, textbooks, and living expenses frequently exceed federal borrowing limits. This situation creates a funding gap that private lenders help fill.

Private loans also serve graduate programs, professional, and other specialized programs that may not qualify for federal aid.

Flexible repayment options, income-based plans, and forgiveness programs are generally not available for private loan programs. As a result, this can make repayment more difficult and lead to higher repayment stress and increased default risk.

Yrefy’s model focuses on this underserved segment: turning distressed private student loans into affordable obligations. This approach may improve borrower recovery, as it is influenced by consistent payments from the borrower.

Student loans—both federal and private are treated differently from other types of consumer debt in bankruptcy. In most cases, these loans are not easily discharged, meaning borrowers generally remain responsible for repayment even after bankruptcy proceedings.

Due to this, some borrowers who experience financial hardship may seek alternatives to bankruptcy, such as refinancing or restructuring their private student loans. Yrefy focuses on evaluating whether these borrowers might qualify for refinancing options that are designed to make repayment more manageable based on their circumstances.

This information is provided for general educational purposes and should not be interpreted as legal, tax, or financial advice. Borrowers considering bankruptcy or debt restructuring should consult qualified professionals.

Yrefy and its affiliated entity, Yrefy SLP5, LLC, create their portfolio by refinancing distressed private student loans that meet  their defined underwriting and eligibility standards.

When a borrower qualifies, Yrefy SLP5, LLC, acting as the lender, pays off the borrower’s existing private student loan at a negotiated discount with the current loan holder. The borrower then gets a new, fixed-rate refinanced loan with customized terms that are generally more manageable based on their individual financial profile.

These newly originated loans become part of Yrefy SLP5, LLC’s loan portfolio under the security agreement with Yrefy SLP4, LLC. Each loan is documented, serviced, and monitored by Yrefy's loan servicing agent, Yrefy SLP5, LLC, to help ensure that repayment is managed correctly over time.

The refinancing process begins when Yrefy identifies borrowers with private student loans that are in default or delinquency. Each applicant is reviewed individually via a detailed underwriting process that evaluates their current financial situation, employment status, and ability to maintain consistent payments.

As part of the underwriting process, eligible borrowers are asked to open an escrow account and begin making anticipated monthly payments during the underwriting period. These payments help demonstrate repayment consistency and readiness. If a loan is not approved, any escrowed funds are returned to the borrower.

For qualified borrowers, Yrefy works with the original loan holder to settle the existing balance at a negotiated discount and refinance the obligation into a new fixed-rate loan. The refinanced loan terms are designed to reflect each borrower’s financial profile and repayment capacity.

The objective of this process is to create refinancing arrangements that borrowers can sustain over time, while maintaining clear documentation, oversight, and servicing to support proper loan management.

Borrowers learn about Yrefy through a combination of professional referrals, broadcast marketing efforts, and online outreach. Referrals may come from organizations familiar with private student lending, such as lenders, servicers, collection agencies, or law firms that work with borrowers seeking to resolve or refinance distressed private student loans.

Yrefy also utilizes digital marketing and other marketing campaigns designed to reach borrowers directly. These efforts aim to raise awareness among individuals who may be eligible for private student loan refinancing and want to explore possible options.

Yrefy uses a comprehensive set of data points to evaluate each borrower’s ability to repay their refinanced loan. In addition to the application and the documentation provided by the borrower and co-borrower, if required, we obtain credit information from one or more of the three major credit bureaus: TransUnion, Experian, and Equifax.

While credit reports help provide a picture of the borrower’s financial history, it is essential to note that Yrefy does not base our underwriting decisions on a FICO score. Instead, we take a holistic approach that considers the borrower’s current income, employment stability, debt obligations, and overall repayment capacity.

This balanced review process helps enable us to work with borrowers with strong potential for successful repayment, even when their credit profiles have been negatively impacted by their prior loan distress.

Based on Yrefy’s experience, the presence of a co-borrower varies depending on a borrower’s financial circumstances. In many cases, a parent or close family member who originally co-signed the private student loan may remain involved when the borrower seeks refinancing.  Historically, the co-borrower percentage in the Yrefy portfolio has hovered around 70%.  This number is subject to change.

Yrefy reviews each borrower’s credit report as part of its underwriting process to help evaluate repayment capacity and financial history. The information is used to understand the borrower’s existing debt obligations, income-to-debt relationship, and overall credit profile.

While Yrefy currently only refinances private student loans, reviewing the borrower’s total outstanding student loan debt, including both private and federal loans, provides context for determining repayment terms that align with the borrower’s financial circumstances.

Yrefy’s primary focus is on the borrower’s ability to afford the new payment and their willingness to repay comfortably. To assess this, we review the borrower’s income, debt obligations, and overall financial stability to ensure the refinanced loan is sustainable.  Before funding the loan, Yrefy requires the borrower to establish an escrow account, which demonstrates both commitment and repayment readiness.

No, Yrefy does not rely on FICO scores as the primary factor in its underwriting decisions.  Because Yrefy specializes in refinancing distressed private student loans, many borrowers come to us with already delinquent accounts that may have negatively impacted their FICO scores.

While a borrower’s FICO score may still be reviewed as part of their credit report, it is not a determining factor in eligibility. Instead, Yrefy applies a holistic underwriting process that evaluates the borrower’s overall financial profile. This includes income, debt-to-income ratio, employment stability, payment history, and demonstrated ability to repay.

This approach allows Yrefy to identify borrowers with genuine repayment capacity, even if their FICO scores are lower due to prior financial hardship.

Yrefy’s underwriting process takes approximately six and a half months from start to funding, although the time frame is subject to change. 

 The Loan Servicing Agent identifies potential borrowers and co-borrowers with existing private student loans who may qualify for refinancing.

Once potential borrowers are identified, the Loan Servicing Agent assists them with completing loan applications and collecting the necessary financial information for underwriting review. If a borrower is approved, the refinanced loan is funded through Yrefy’s affiliated lending entity.

This process helps coordinate communication among borrowers, lenders, and servicers, supporting an organized and transparent refinancing experience from initial contact through loan approval.

No -- while many Yrefy borrowers have experienced credit challenges, eligibility is not limited to those with lower credit scores. Some borrowers may have stronger credit profiles, depending on their financial history and circumstances.

Yrefy reviews credit reports as part of its underwriting process, but decisions are based on a broader evaluation of each borrower’s income, employment stability, debt obligations, and overall repayment capacity rather than solely on a FICO score.

Yrefy asks borrowers to make at least two months of anticipated escrow payments before the Loan Committee reviews their application. This helps demonstrate a borrower’s ability to make consistent payments and their readiness for repayment.

The escrow period enables Yrefy to assess if a borrower’s financial circumstances align with the proposed refinancing terms before final loan approval.

Federal student loan forgiveness programs do not directly affect Yrefy’s operations because the firm currently works exclusively with private student loans, which are not eligible for federal forgiveness.

If a borrower holds both federal and private student loans and qualifies for forgiveness under an eligible federal program, a reduction in their federal loan balance could improve their overall financial position by lowering monthly payments. In some cases, this may enhance a borrower’s ability to qualify for or manage a refinanced private loan.

Changes to federal forgiveness programs are not expected to have a direct impact on Yrefy’s business, though they could indirectly influence borrower financial conditions over time.

No, Yrefy does not participate in any federal student loan forgiveness programs.

No, Yrefy does not currently offer refinancing for any federal student loans.

Yrefy’s mission is to help address the challenges faced by borrowers with distressed private student loans by evaluating whether they may qualify for refinancing under terms designed to fit their financial situations.

In this way, Yrefy seeks to promote responsible lending and repayment practices while supporting broader access to sustainable private loan solutions.