It is a known fact that for-profit colleges in some cases, according to the Department of Justice
, receive an incentive for getting a certain number of student to enroll regardless of there qualifications. In its complaint, the government alleges that (EDMC) Education Management Corp falsely certified compliance with provisions of federal law that prohibit a university from paying incentive-based compensation to its admissions recruiters that is tied to the number of students they recruit.
I do agree, however, with the recent New York Times
article that for profit colleges should be faced with more scrutiny. For profit colleges have one goal and that is to make their college profitable. Although giving loans out to students on average has a very high debt ratio, it's almost like saying to non-qualifying student, if you can't afford college you shouldn't even try. With very few non for profit colleges out there, it seems that for profit colleges remain the dominant key player in the pursuit for higher education.
Programs that would help students address student loans are almost the equivalent of dealing with a mortgage loan officer in some cases. The choices are very few and in-between, currently programs such as the Income-Based Repayment plan
, created back in 2009 can only help people who are able to make a payment. But what about the growing number of students who are unable to meet their repayment obligations.
So far college debt has surpassed credit card debt. Student loan debt has been growing steadily because need-based grants have not been keeping pace with increases in college costs According to FedAid
. For the first time in our history, outstanding student loans surpassed total credit card debt for United States borrowers. According to an article by Laura Rowley
, private lending to students has created a “bubble” that looks very similar to the sub-prime mortgage lending crisis.
Higher education is still important in a competitive economy, I think there is enough common ground to say that no student should start taking college loans if their undecided. In conclusion education is an investment. Everyone wins in the pursuit of higher education but if it is misdirected everyone loses out except for the college and loan providers. It all goes back to the question, Is it a good investment for you. I would take comfort in knowing many successful people in the world never graduated college.