After months of working a dead-end job and spending your nights alone in front of the television, you’ve finally decided to do something productive with your life. You’ve enrolled in an online college, because the dancing waitress from the ads told you that it was the best way to improve your station in life. Now, for the first time in a long time, things are looking up. In a few semesters you’ll have your associate’s degree in business administration, and you’ll never have to wash a dish again.
Enjoy that feeling, because in three years your life will likely be ruined. Just ask the Department of Education.
Recently, the DoE released its first official report regarding student loan repayments in America’s higher education system. What it found was shocking. It turns out that a lot of college grads have problems repaying their staggering student debts, and none more so than the poor souls who attend one of the country’s controversial for-profit colleges, like Kaplan University or the Art Institutes.
According to the report, 22.7% of for-profit college grads who began repaying their student loans between October 2008 and October 2009 defaulted on them by September 2011. That’s double the 11% three-year default rate of students who went to a public school and triple the 7.5% rate for students who went to private, non-profit colleges.
That’s an appalling statistic. We’ve always suspected for-profit colleges were a scam, but we never knew they were this bad. What it means is that one out of every 4.4 students who enroll in a for-profit school today will be saddled with crushing debt within three years of graduating. And that’s just the tip of the iceberg. The Department of Education survey only covered a three-year period. If the survey were extended to cover ten years, we suspect it would find that nearly 50% of for-profit graduates eventually default on their loans.
For us, this is the final nail in the coffin. Many former students have filed lawsuits against for-profit colleges recently, alleging that these schools knowingly and willingly fail to adequately prepare students for a career. We have to agree with them.
The DoE’s report proves what so many experts and plaintiffs have argued for years – for-profit schools don’t care about their students. They only care about maximizing profit, and the fact that the government has allowed them to parade around as legitimate institutions for years is a travesty.
Of all the schools with ridiculously high default rates, only two will be subject to sanctions – Centro de Estudios Multidisciplinarios in San Juan, Puerto Rico, and Tidewater Tech in Norfolk, Va. And the only punishment they face is the loss of their federal student aid programs. That’s unacceptable. At the very least, we should force failing for-profit schools to disclose their high default rates to potential students. Unfortunately, it doesn’t look like that’s going to happen any time soon, which means that the responsibility to avoid these debt traps rests squarely on the shoulders of students themselves.
So the next time a dancing waitress offers you a chance to go to school online and get your degree on your own time, tell her to stuff it. There are better ways to improve your life, like enrolling in a real college. It’ll be less expensive. And who knows – you might actually learn something.