• About Me
  • Courses
  • Contact
    • Ads
  • Press & Media
  • Free eBook
  • Free Facebook Group
  • Disclosures
    • Privacy
Yes, I Am Cheap
Plans starting at $15 /month & Phones starting at $99
ADVERTISEMENT
  • Home
  • News
    • All
    • Politics
    stimulus

    Why You Might Not Get A Stimulus Payment

    Credit card security, equifax data breach

    How to Claim $125+ from the Equifax Data Breach Settlement

    foreclosure homes - When Does It Make Sense to Refinance?

    When Does It Make Sense to Refinance?

    no apple

    Get A New iPhone? Heck No!

    poor definition

    Mom Fired For Working At McDonald’s While Kid Plays In Park…Was She Wrong?

    What’s Keeping You From Finding A Job

    U.S. Students Fall Behind: Seemingly Get Dumber By The Minute

    Trending Tags

    • Trump Inauguration
    • United Stated
    • White House
    • Market Stories
    • Election Results
  • Lifestyle
    • All
    • Food
    • Health
    high deductible health plan

    What Is A High Deductible Health Plan?

    free thanksgiving dinner

    How to Get Your Thanksgiving Meal for Free

    using hand sanitizer, your own

    How to Make Your Own Hand Sanitizer

    Yoga pose

    5 Ways to Practice Yoga on a Budget

    Traveling, new cultures, Start a Saving Challenge, Spend Smart on Food

    3 Simple Ways to Save for A Vacation

    spending money, debt, Take a Roommate, Get a Smaller Home

    Lifestyle Changes To Pay Down Debt Faster

    Trending Tags

    • Golden Globes
    • Game of Thrones
    • MotoGP 2017
    • eSports
    • Fashion Week
  • Investing
  • Make Money
  • Learn Something
  • News
  • Reduce Debt
  • Rental Property
No Result
View All Result
  • Home
  • News
    • All
    • Politics
    stimulus

    Why You Might Not Get A Stimulus Payment

    Credit card security, equifax data breach

    How to Claim $125+ from the Equifax Data Breach Settlement

    foreclosure homes - When Does It Make Sense to Refinance?

    When Does It Make Sense to Refinance?

    no apple

    Get A New iPhone? Heck No!

    poor definition

    Mom Fired For Working At McDonald’s While Kid Plays In Park…Was She Wrong?

    What’s Keeping You From Finding A Job

    U.S. Students Fall Behind: Seemingly Get Dumber By The Minute

    Trending Tags

    • Trump Inauguration
    • United Stated
    • White House
    • Market Stories
    • Election Results
  • Lifestyle
    • All
    • Food
    • Health
    high deductible health plan

    What Is A High Deductible Health Plan?

    free thanksgiving dinner

    How to Get Your Thanksgiving Meal for Free

    using hand sanitizer, your own

    How to Make Your Own Hand Sanitizer

    Yoga pose

    5 Ways to Practice Yoga on a Budget

    Traveling, new cultures, Start a Saving Challenge, Spend Smart on Food

    3 Simple Ways to Save for A Vacation

    spending money, debt, Take a Roommate, Get a Smaller Home

    Lifestyle Changes To Pay Down Debt Faster

    Trending Tags

    • Golden Globes
    • Game of Thrones
    • MotoGP 2017
    • eSports
    • Fashion Week
  • Investing
  • Make Money
  • Learn Something
  • News
  • Reduce Debt
  • Rental Property
No Result
View All Result
Yes, I Am Cheap
No Result
View All Result

For Profit Student Loan Default Rate Hits 25%

Sandy Smith by Sandy Smith
August 24, 2019
in News
8
For Profit Student Loan Default Rate Hits 25%
Share on FacebookShare on Twitter

This post may contain affiliate links which may compensate us based on your interaction. Please read the disclosures for more information.


Welcome back! Have you checked out the free webinar on how to establish credit for your small business?


About one-quarter of students who took out federal loans to attend for-profit colleges defaulted within three years of starting repayment, according to a new federal analysis.

The 25 percent default rate in the for-profit sector, part of an Education Department report to be published Friday, was up from a 21 percent rate estimated in December 2009.

Loan defaults are on the rise throughout higher education because of economic troubles. The three-year default rate for public colleges is now about 11 percent, up from about 10 percent in the previous report. The rate for private nonprofit colleges is about 8 percent, up from about 7 percent.

Federal officials cautioned that the new data, which measured defaults over three years among a group of borrowers who entered repayment in fiscal 2008, are preliminary and are not being used for enforcement. Still, the figures underscore growing challenges facing the for-profit sector.

The Obama administration is considering new regulations related to student debt and loan repayment – an effort that federal officials say would help ensure students in for-profit colleges find “gainful employment.” Many leaders in the for-profit sector – including executives from the Washington Post Co., which operates the Kaplan line of for-profit schools – oppose the proposal.

But loan default measurements will be relevant even if the industry successfully blocks that proposal. Under federal law, schools must keep loan default rates below a certain level or they lose eligibility to participate in federal financial aid programs. A 2008 law ordered a switch, over several years, to a three-year default metric. For enforcement purposes, the government currently measures defaults over two years, which tends to yield a lower rate.

Harris N. Miller, president of the Association of Private Sector Colleges and Universities, said for-profit schools are “obviously concerned” about default rates and are taking steps to lower them.

Sen. Tom Harkin (D-Iowa), who favors tighter regulation of for-profit schools, said the new default data show that “serious questions have to be raised about the taxpayer investment in these companies.”

This article was originally compiled by Nick Anderson of the Washington Post. Before using private student loan companies to finance your or your child’s education, consider looking at the best 529 plans.

Join the newsletter

Subscribe to get our latest content by email.

Success! Now check your email to confirm your subscription.

There was an error submitting your subscription. Please try again.

We won't send you spam. Unsubscribe at any time. Powered by ConvertKit

Related

Previous Post

Free Premium Federal Tax Filing From H&R Block

Next Post

Don't Let Debt Depression Get You Down

Sandy Smith

Sandy Smith

I started this blog years ago as a way of keeping myself accountable to my own debt reduction plans. Now I'm using this site to help others get out of debt, and learn about personal finance so that they can live their best lives.

Next Post
Don't Let Debt Depression Get You Down

Don't Let Debt Depression Get You Down

Comments 8

  1. krantcents says:
    10 years ago

    I am not surprised, these students pay a lot for their education in the for profit schools and do not find the lucrative jobs as promised. So they default! I feel these schools are taking advantage of them. I personally discourage my students from going to these schools, instead encourage them to seek out community college or public trade schools.

    Reply
  2. Mark says:
    10 years ago

    That is a ridiculously high rate. Many of these schools prey on students that are desperate for an education.

    Reply
    • Sandy says:
      10 years ago

      You first sign loan papers when you enter school at 17 or 18. You have no clue about the repercussions of defaulting. Plus, new graduates are having a hard time finding jobs.

      Reply
  3. Moneycone says:
    10 years ago

    Wow! That is a high rate for defaults! Shows how much hope the students lost after joining these for-profit colleges!

    Reply
  4. Robert @ The College Investor says:
    10 years ago

    The even scarier part of this whole thing is that even though the loan is in default, the government will still get their money in the end. Federal student loans can not be discharged…so these people will end up having their wages garnished or other liens placed against them.

    Reply
    • Sandy says:
      10 years ago

      I don’t think that alot of people realize that. Student loans and tax debt will never go away.

      Reply
  5. Little House says:
    10 years ago

    My mother-in-law worked as a dean at a university and recently told me about this law that is going into effect. Basically for for-profit college students who take out student loans, 80% of those students must be working within their major within 6 months after graduation. I’m just not sure how the universities are going to guarantee that 80% of their students will and can follow through with their professional plans. Life happens. People get married. Women have babies and decide to stay at home. People decide they don’t like working in their field and change directions.

    I really think that instead of this law, they need to offer mandatory courses throughout each semester on how to pay back student loans. It could start with just paying $20-$30 a month on future interest charges. This alone could cut the default rate in half if people just knew how to budget!

    Reply
  6. Geraldo Moreschi says:
    9 years ago

    I have learned many important things via your post. I would also like to say that there may be a situation where you will apply for a loan and never need a cosigner such as a Government Student Support Loan. But when you are getting a borrowing arrangement through a conventional banker then you need to be made ready to have a co-signer ready to make it easier for you. The lenders will certainly base their decision on the few aspects but the biggest will be your credit worthiness. There are some lenders that will in addition look at your work history and make a decision based on that but in many cases it will hinge on your report.

    Reply

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Stay Connected

  • 5.5k Fans
  • 10.3k Followers
  • 4.7k Followers
ADVERTISEMENT
  • Trending
  • Comments
  • Latest
The Government Gives Free Appliances? Yup!

The Government Gives Free Appliances? Yup!

August 24, 2019
Cost of Living in the 1950’s as Compared to Today in 2013

Cost of Living in the 1950’s as Compared to Today in 2013

August 24, 2019
side hustle during quarantine

Top Side Hustles to Boost Your Income During Quarantine and After

October 5, 2020
Tax Refund - Don't Have Kids If You Can't Afford Them

Don’t Have Kids If You Can’t Afford Them

August 24, 2019
high deductible health plan

What Is A High Deductible Health Plan?

January 25, 2021
Tesla Stock Price

Why Tesla Stock Performed So Well In 2020

January 25, 2021
stimulus

Why You Might Not Get A Stimulus Payment

January 25, 2021
emergency fund saving money

Gamify Saving Your Emergency Fund in 2021

January 25, 2021

Recent News

high deductible health plan

What Is A High Deductible Health Plan?

January 25, 2021
Tesla Stock Price

Why Tesla Stock Performed So Well In 2020

January 25, 2021
stimulus

Why You Might Not Get A Stimulus Payment

January 25, 2021
emergency fund saving money

Gamify Saving Your Emergency Fund in 2021

January 25, 2021

Helping you live your best financial life through personal finance news and education

Follow Us Everywhere

Browse by Category

  • About Me
  • Auto
  • Credit
  • Credit Cards
  • Finance 101
  • Food
  • Get Out of Debt Course
  • Health
  • Investing
  • Learn Something
  • Lifestyle
  • Make Money
  • News
  • Off The Reservation
  • Partner Posts
  • Politics
  • Rants
  • Reader Advice
  • Recipes
  • Reduce Debt
  • Rental Property
  • Save Money
  • Scams
  • Special Offers
  • Spend Money
  • Sponsored Posts
  • Video Pick
  • Weekly Roundup
  • Work

Recent News

high deductible health plan

What Is A High Deductible Health Plan?

January 25, 2021
Tesla Stock Price

Why Tesla Stock Performed So Well In 2020

January 25, 2021
  • About
  • Advertise
  • Privacy & Policy
  • Contact

© 2021 JNews - Premium WordPress news & magazine theme by Jegtheme.

No Result
View All Result
  • About Me
  • Courses
  • Contact
    • Ads
  • Press & Media
  • Free eBook
  • Free Facebook Group
  • Disclosures
    • Privacy

© 2021 JNews - Premium WordPress news & magazine theme by Jegtheme.

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Cookie settingsACCEPT
Privacy & Cookies Policy

Privacy Overview

This website uses cookies to improve your experience while you navigate through the website. Out of these cookies, the cookies that are categorized as necessary are stored on your browser as they are as essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may have an effect on your browsing experience.
Necessary
Always Enabled

Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.

Non-necessary

Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.