USA proposes new regulations to limit for-profit schools from plundering educational grants
For-profit grant students default more, graduate less.
Students at for-profit institutions represent a disparate proportion of defaults on student loans. Many leave school with heavy debts and without the ability to find a high-paying job, frequently because they did not complete their studies.
Recruiting campaigns that dedicate up to 30 percent of revenue to advertising focus on marketing the institutions to low-income students as quick providers of valuable degrees that will result in high-paying jobs.
"The Department of Education under the Obama administration has proposed new regulations to govern the for-profit college industry, which has grown into a $30 billion business within the higher education sector. These schools — like the University of Phoenix, Kaplan University, and Strayer University — say that they cater to underserved segments of the population that can't access more traditional institutions of higher education. While that is a laudable goal, for-profit schools rely on student access to Pell Grants and guaranteed student loans, yet so little of that taxpayer investment results in student success, and the colleges still profit mightily
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Posted: February 23, 2011
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