Posted on 03/29/2011 9:46:30 PM PDT by TheDingoAteMyBaby
TAMPA - Westwood College representatives questioned Becky Loring about her hopes for the future. And when she wavered — worried about whether she could afford the $45,000 program — the recruiter used Loring's own words to seal the deal.
"If you don't do this," she recalled the representative saying, "you're never going to get what you've always wanted."
Loring, 32, now owes the government and private lenders more than $100,000. Working in sales, she is far from the graphic design job she studied for, barely able to make her college loan interest payments.
"When I think about it, I just feel nauseated," she said. "How did I let this happen?"
Students such as Loring are borrowing billions from the government every year to attend for-profit career colleges, where enrollment nationwide has tripled in 10 years.
Loring is working with her lenders to keep from defaulting, but she's on the edge, she said.
Meanwhile, tens of thousands of others have gone over, a recent federal report showed.
Of the career college students whose federal loans came due in 2008, nearly 25 percent quit making payments in the three years that followed. Taxpayers are ultimately responsible for paying off bad federal loans.
Default rates for some local colleges were even higher. The report showed Everest University in Largo with a three-year default rate of more than 41 percent. The Tampa branches of ITT Technical Institute and Concorde Career Institute were at nearly 30 percent.
By comparison, the rate for private nonprofit colleges and universities was 8 percent. For public institutions, it was 11 percent.
People have poured into the for-profit colleges in the past few years on federal student loans, searching for new careers in a weak and changing economy. But as the loan defaults rise, government regulators are trying to rein in the rapidly expanding schools — and facing protests from the industry.
People who are close to the issue disagree about what a high default rate means.
To critics of the for-profit college industry, it's a sign of a poor-quality school that will say anything to snag new students, manipulating their hopes and shading the truth about accreditation and job prospects.
To industry defenders, it shows these schools open their doors to people who have trouble in traditional colleges, who are often poor and struggle to pay their bills, especially during a recession.
The report on default rates is preliminary. Congress established the calculation in 2008, saying colleges with loan default rates of 30 percent and above for three years would risk losing their federal aid eligibility beginning in 2014.
Students are required to start paying back loans after they graduate, though many appeal to lenders to delay repayment. The recent report looked at students with repayment dates starting in 2008 and counted those who defaulted on those payments over the next three years. The number was more than 457,000.
Sen. Tom Harkin, D-Iowa, chairman of the Health, Education, Labor and Pensions Committee, held hearings last year into what taxpayers get back from the billions the government gives to for-profit colleges. The figure was nearly $30 billion last year.
For-profits enroll about 11 percent of all college students but account for about 45 percent of all student loan defaults.
"Serious questions have to be raised about the taxpayer investment in these companies," Harkin said.
Nationwide enrollment in for-profit colleges is about 1.8 million students.
A stretch of Dr. Martin Luther King Boulevard west of Interstate 75 tells the story. On one corner is Rasmussen College. A mile west is a branch of Southwest Florida College, next to a branch of Everest University.
Complaints have grown with the numbers. Witnesses at Harkin's hearings last year told of colleges exaggerating job prospects, fudging financial-aid applications and leaving graduates with heavy debt and few opportunities.
In October, the U.S. Department of Education released new industry regulations scheduled to go into effect in July. A trade group has gone to court to stop them.
The dozens of changes include requirements to:
•Cease paying admissions representatives on the basis of how many students they enroll.
•Provide easy-to-find job placement statistics by program, using methods verified by an outside agency.
•Require states to regulate all colleges with any students in the state, regardless of whether they have a branch or employees in the state.
For-profit representatives aren't happy with how the rules came about.
It was "the most biased process I have ever seen," said Kathy Mizereck, executive director of the Florida Association of Postsecondary Schools and Colleges. The group's 900 for-profit schools and colleges have about 370,000 students.
The Harkin hearings were stacked with opponents of the for-profit college industry, she said. And bad things happen in every school, she said.
"I got a call the other day about a community college student who had $90,000 in debt and had nothing to show for it."
The most controversial proposal to emerge last year, the so-called gainful employment rule, has yet to be released in final form.
It's a process intended to ensure students can repay their loans, taking into account the students' income, debt load and potential employment. The complex calculation also includes the loan repayment rate by students from each college.
A low score could limit a college's federal loan eligibility.
The industry is lobbying hard to modify the final rule, which is expected to come out any day.
"We've been told there's going to be a very, very big revision," said Kent Jenkins, vice president of the Everest College parent company, Corinthian Colleges, based in Santa Ana, Calif.
Florida has imposed its own new rules, said Samuel Ferguson, executive director of the Commission for Independent Education, which monitors for-profit colleges.
Admissions representatives, for instance, have to go through a training program in what they can and can't say to prospective students, he said.
But students also have a responsibility to ensure that a program is accredited and meets their needs, he said.
Cassandra Perry, 24, learned her lesson when she attended ITT in Virginia and couldn't get other colleges to accept the credits she earned there, she said.
After she and her husband moved to the Tampa area, she chose the University of Phoenix, partly because it had a more widely accepted accreditation.
She worked during the day and went to class at night.
"My classes were small. It's like we were a family," she said. "This has worked out perfectly for me."
Graduating in June with a bachelor's degree in psychology, she has applied to the University of South Florida's graduate program.
It's selective, so she doesn't know if she will make it, but she's counting on USF accepting her University of Phoenix degree, she said.
Becky Loring thought she did her homework when she picked Westwood when she lived in Seattle in 2006.
The admissions representative assured her Westwood, owned by Alta Colleges Inc., based in Denver, Colo., was accredited by a national agency recognized by the U.S. Department of Education.
Loring had always loved design and liked the description of Westwood's visual communications program, which she could complete online.
But the $45,000 price tag made her nervous.
She said the admissions director told her not to worry, that she would make at least $70,000 a year no matter where she lived because she could easily work from home.
Loring got a federal loan for $60,000, but that wasn't enough to cover her college costs and living expenses, she was told, so Westwood helped her apply for private loans.
The school refused to accept several credits from an online college she attended earlier, contrary to what the Westwood representative had told her.
Her costs continued to rise when she had to buy expensive equipment and software, and pay online fees, so she borrowed more money and pushed on, committed to finishing.
She moved to Sarasota and graduated from Westwood in 2009 with mostly A's. She built what she thought was a solid portfolio, including fliers, brochures and booklets with logos and other elements she had designed.
"I was so excited," she said. "I did not take advantage of my education in high school, so in college I was determined to apply myself and do my absolute best."
She put out dozens of résumés, she said. No response.
Maybe she needed more education, she thought. But when she began looking into the state universities, she realized she was in trouble. Admissions representatives told her the Westwood degree didn't count for them.
Though Westwood was accredited, it wasn't accredited by an agency they recognized.
"I had a clear path and I thought I knew where I was headed," Loring said. "Now it's like I'm swimming in murky waters."
She contacted Tampa law firm James, Hoyer, Newcomer, Smiljanich & Yanchunis after seeing a television news report about problems at Westwood. The firm is suing Westwood.
A Westwood spokeswoman, Emily Port, questioned Loring's assertion that she was told she would make $70,000 a year.
A company website shows that 77 percent of its visual communications graduates are employed in their field of study, but the average reported salary is $35,000 a year.
Port also said the company informs students about program costs and the risk that not all colleges will accept Westwood's credits.
Loring stands by her recollection of the assurances she received regarding credit transfers and job prospects, but she blames herself for believing them.
She is one of nearly 1,200 students who have contacted James, Hoyer with complaints about Westwood. Most of them are struggling with tens of thousands of dollars of debt, said attorney Jonathan Cohen.
The firm also has received hundreds of complaints about other for-profit colleges. Their stories are often the same.
"They start out so proud and end up buried in debt with a piece of paper that doesn't mean anything," Cohen said.
More than 180 Florida students have complained to the state attorney general about their experiences at for-profit colleges.
"I was counting on a degree to help with a promotion in my career and I got nothing but debt," wrote Kimberly Bramblett of Crawfordville about her experience with a Kaplan online program.
"Please help me," wrote Janet Ayala, who borrowed $8,000 for the medical assistant program at Everest in Lakeland and can't find a job. She was wary of taking on the debt, she said, but Everest representatives were persistent, calling her every day at one point.
Jenkins said Corinthian has become more cautious about enrollments. It has stopped accepting students who don't have a high school diploma, and its short-term default rate is declining.
It was not an easy decision to start saying no, he said.
"These are students who have nowhere else to go."
So what?
What do you think government borrowing, getting short and long term bonds are? They are taxes, bills presented to the young, collected upon a new, younger generation.
Today’s adults spend, and the young pay for today’s spending when they grow up, only it is collected at the point of a gun, or a IRS exam.
I hate to say but she probably makes as much in sales as she would as a graphic designer.
Yes there is a big difference. The for profit schools are more ethical and spend less time indoctrinating the students with leftist ideas.
Please note that the New York Times owns a large number of these for profit schools.
Exactly you’ll have to hire ‘one’.. People get jobs playing the Piano all the time but if you really want to make a living with it you better go to a school with a great reputation!
Honestly were I a hiring manager I would take a HS diploma from a top 100 HS in WNY over a degree from one of these rubber stamp programs in a heart beat.
"For-profits enroll about 11 percent of all college students but account for about 45 percent of all student loan defaults."
I need more numbers here. With 90% of the student population and a default rate of around 10%, it looks like traditional colleges put out many more student-loan defaulters than just the 55% the article says.
But, then they wouldn't have a fancy diploma to frame and hang on their wall. < /sarc>
No, I agree with you. There are a lot of tradesmen that make a good living and own their own business. We have a neighbor who has his own electrical business, and he has several employees. He is always busy.
Always assume the other guy is out to screw you, and act accordingly. You will not be able to protect yourself 100%, but if you ask yourself “What is this guy getting out of it, and what do I get out of it?” you can limit your losses.
It has to. Not everyone, not even the majority, need a college degree. To say otherwise is to be ignorant of history and of people in general.
I’ve heard these individuals say that when they see a for-profit school on a resume, they toss it out.
My wife was dismissed from teaching at the for profits. They gave different reasons, but both times it was after a confrontation where she refused to alter her attendance records. In these instances, students had not met the attendance requirements to maintain their loans for the next semester.
I have personal knowledge of three for profits. One was semi-legitimate. The other two were strictly there to get the loan money. In one instance, the principles, after losing their ability to get federal loans for students, dissolved the corporation and reformed within three months as a new corporation with a clean record.
The typical student in the for profits was in their twenties, poor high school records, generally minor run ins with the law (marijuana or public intoxication type stuff) often a single mom, maybe not too bright but there were exceptions, and looking for a chance to get into a semi-skilled trade. Some of them had no intention of paying back the loans, but were attending school strictly to get the money (housing and food allowances were part of the loan package.) Their viewpoint was that they didn't have any money or any credit rating, they were never going to have them, and they already had a ton of defaulted loans. So, they attended school for a few semesters, sort of, and that money was the equivalent of a welfare check. Not all for profits are rip offs, but they are pretty much unregulated and there are a bunch of con artists out there.
You do know that virtually every TV commercial, movie title sequence, print ad, magazine layout, website, display, billboard, menu, product package, label, book cover, etc is deigned by a graphic designer, right? Hardy a useless degree.
It was stated the other way around.
A young man, when he was seventeen, HIS mom takes out a student loan. Many years later, AFTER mom is DEAD, the IRS attaches his refund for the student loan of the mom.
I do not remember the Freepers name.
And the GOVERNMENT has taken over ALL student loans.
How do you know what there standards are?
bingo!
Generational indentured servitude is nothing to be proud of.
Those who say “so what” sound to me like those who have been bought off by the phony politicians and their lies.
Believing lies has consequences. They do hurt.
Please see post #75 for clarification.
Last I checked, 18 was an adult. Let her pay her own damn way. We don't need to be nanny-state to the kids at that age. They should be ON THEIR OWN.
And you dont think those 100 top hs students are going to college? :)
They will work for you for six months making whatever pennies you pay and then realize they are better off going and quit on you.
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