The US govt has started blocking pell grants and other govt funded loans and programs going to for profit schools. Their reasoning is that about 1/3 of the students aren’t paying their loans back.
“Even though they account for just 26% of all federal loans.
Over one-third of federal student loan defaults can be attributed to students at for-profit schools.
Students at for-profit colleges accounted for 35% of defaults during the three year period starting in 2013—down from 44% two years earlier, according to new data from the Department of Education, released Wednesday. Though it should be noted that students at for-profit colleges account for just 26% of all borrowers.
The report measured the number of students or former students who had failed to make a payment for 360 consecutive days since the loan was first issued during the fiscal year ending September 2013.
That comes at a time the DoE has been increasingly cracking down on for-profit colleges such as ITT Technical Institute, DeVry, Corinthian Colleges, and Brown Mackie College. Critics have accused for-profit institutions of deceiving consumers and pushing low-income students into costly loans.
In early September, the ITT Educational Services said it would shut its doors after the DoE said that students at the college were no longer eligible for federal funding. It was a death blow, as federal student loans accounted for 68% of the company’s revenue in 2015. Corinthian Colleges was also forced to close last year, while Brown Mackie College whittled itself down from 28 locations to just four”
So, what the govt is saying is that about 1/3 of the people who borrow from the govt go to for profit schools, and barely more than 1/3 of the people don’t pay their loans back. So it’s about the same as public school, but the govt doesn’t like for profit schools because they focus on one subject, instead of forcing the student to take subjects that can liberalize the college student.
Now, Regent Beauty, with 79 schools, abruptly closed it’s doors, and I’m afraid more will be coming.
Students were devastated Thursday after learning their school, Regency Beauty Institute, is permanently closing all campuses.
The school cited multiple reasons for closing, including declining numbers of cosmetology students nationwide and a growing negative characterization of for-profit education.
“I’m angry but I’m more so hurt,” said Lauren Jelen, a Regency student. “How do you just abandon that many students and families? There are people who just found out yesterday, they don’t have a job and how do you even process that?”
Some students found out about the closing by text message, others showed up to class to see a sign posted on the doors of the school’s 79 campuses.
In my opinion, it’s kind of disgusting how Regency handled things. They gave the students 2 hours to get their stuff. The week before, they were still taking in new students, and students are left with outstanding loans. And they still have postings for employment up.
But the suddeness of these closings should be a wake up call to everyone. Things are closing down quick. Sports Authority, Hobby Lobby, ITT, now this. There are many. This country is going under quick.