U of Illinois-Springfield

56,000 students at ITT Tech and Corinthian College woke up to news that their school had closed, leaving them with thousands of dollars of debt and no degree. What happened at these giant Mc-Colleges also happens with some frequency to smaller for-profits that fail their students. But many failing for-profits fly under the Department of Education’s radar for years without serious oversight, which means it is up to students to make sure they make the right choice when going to college or a trade school.

In New York State, one-third of all “higher ed” (after high school) colleges and institutions are for-profits. New York City is home to 67 that range from nursing schools to four-year colleges. Most charge three to four times as much as community colleges do for comparable courses. And that Lexus education comes with no engine to increase your earnings. The Department of Education reports that 40 percent of New Yorkers who go to for-profits earn less than a high-school graduate ($25,000), six years after enrolling. But it gets even worse. A recent study by Stephanie Cellini of George Washington University examined the earnings of a million for-profit students six years after they set foot in a for-profit classroom. More than half of those students saw their wages fall.

Another reason to avoid for-profits is debt. Most for-profits take any student, regardless of ability. And these students are largely poor and thus must take out large federal loans. Failing to finish school or secure a good job after graduation does not excuse repayment of a student loan. Rather, borrowers are generally on the hook for their federal loans for their entire lives, even if the school does not offer a quality education. With interest and penalties, these unpaid loans quickly mushroom into inescapable debt traps. The inability to repay a loan not only cripples people financially but also prevents them from pursuing additional educational opportunities. Many schools will refuse to release transcripts until debts are repaid, creating what can feel like an inescapable situation.

Of course, not every for-profit is a debt trap. For example, many of the boot-camp computer programming schools have provided high returns for their students. But most for-profits should be avoided. Here are some of the warning signs you should look out for if considering a for-profit.

  • Pressure point advertising: “What are you really afraid of?“Don’t you want to make something of your life?”
  • An admissions office on wheels (usually a giant RV): “We reach out to the neediest” and park near welfare offices and poor neighborhoods where prospective students can only pay high tuitions with federal loans.
  • Evasive answers: “Monthly loan payments are manageable.”
  • Pushy Recruiters: “Only two seats left.”
  • No Time, No Problem: “Classes start every two weeks.”
  • On-line and evening classes: “We help working people who want to help themselves.”
  • High Job Placement and Salaries: “I’m not supposed to talk salary, but you can make $38,000 after nine months of training as a medical assistant.”
  • Dream Careers: “CSI lab tech; Video Game Programmer.”
  • Same day admissions with no interest in SAT scores or high school grades: “We are a new breed of educators.”

If you’ve already fallen victim to these tactics, and are now struggling to pay your student loans, don’t despair: help is available. At Legal Services NYC, we provide free lawyers to help low-income New Yorkers get out from under student debt.

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Johnson Tyler is an attorney at Legal Services NYC (LSNYC), the largest provider of free civil legal services to low-income New Yorkers. Johnson and his team specialize in helping those who are struggling to repay federal student loans (even students who went to legitimate schools.) If you have concerns that you signed up with a bad for-profit; want more information on how to deal with your student loans; or advice on how to choose a school, please contact Legal Services NYC’s hotline at 917-661-4500. Additionally, students can go to https://collegescorecard.ed.gov to get the cost, earning power, and graduation rates of thousands of schools.