For-profit colleges are private colleges run and managed by profit-seeking organizations or companies. These colleges differ from state or community schools, which are public or not-for-profit institutions.
For-profit colleges have seen an increase in students in recent years: seven years ago, three times as many students were enrolled in nonprofit colleges than in for-profit colleges. However, in the 2008 to 2009 academic year, that ratio dropped to 2:1. With the boom in popularity, though, came scrutiny of for-profit colleges’ practices.
For-profit colleges primarily target low-income, under-educated students who qualify federal loans, as well as veterans or active military personnel, and they lure them in with promises of high-paying jobs after graduation. However, they charge high tuition rates, which most students that the colleges target cannot afford. Students are thus forced to take out loans, but many drop out of the college before earning a degree, or are unable to find a job that can allow them to pay off their loans after graduation. They’re left with mountains of debt. Student loans can’t even be eliminated by filing bankruptcy, so this debt could follow students for the rest of their lives.
Government is working to regulate the practices of for-profit colleges. For instance, for-profit college recruiters used to be paid based on how many students they signed up, so the recruiters would were motivated to sign up as many people as they could, whether or not they were a right fit for the school. The Obama Administration has essentially eliminated this practice.
