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Miami Bankruptcy & Criminal Attorney / Blog / Bankruptcy / For-Profit Colleges Often Lead to Major Student Loan Debt

For-Profit Colleges Often Lead to Major Student Loan Debt

Student loan debt is a major problem for many Florida college students. Student loan debt can be especially worrisome if you are a student of a private, for-profit college. Many Florida residents turn to for-profit schools because they are unable to obtain postsecondary or vocational education through more traditional colleges. But for-profit schools often carry a much higher price tag. According to U.S. News & World Report, the average tuition for a for-profit school can be five times as high as the cost of attending a two-year community college.

Higher tuition also means higher debt, as students take out loans to cover their expenses. U.S. News said 90 percent of for-profit college students are carrying an average student loan debt of about $40,000. And many of these graduates find it difficult to find employment after graduation, as employers tend to value for-profit degrees less than a bachelor’s degree from a traditional non-profit college.

Florida, U.S. Officials Target “Abusive Recruitment Methods”

In many cases, students are the victims of high-profile sales tactics employed by for-profit colleges. Last year, the Florida Attorney General joined several other states and the U.S. Department of Justice in reaching a $99.5 million settlement with Education Management Corporation (EDMC), one of the largest operators of for-profit colleges in the United States. Without admitting any legal liability, EDMC agreed to stop using “abusive recruitment methods,” which the settlement with the Florida Attorney General’s office defined as “the intentional exploitation of a Prospective Student’s fears, anxieties, or insecurities, or any method intentionally calculated to place unreasonable pressure to enroll in an EDMC school.”

As part of the settlement, EDMC is also required to give all new students a one-page disclosure statement explaining, among other things, the total estimated cost of attendance, the percentage of students who actually complete a degree program, the average student debt burden, and the percentage of students who default on their loans.

Get Help With Your Student Loan Debt

Unfortunately, graduating with a worthless degree from a for-profit college does not excuse you from paying back the student loan debt. However, if you attend a for-profit college that closes before you complete your degree, or the school closes within 120 days of withdrawing from classes, you may be eligible for a discharge of your student loan. You are not eligible for a discharge, however, if you have completed a degree program or transfer credits to another school.

If you are in trouble due to student loan debt, you do not have to deal with the problem by yourself. An experienced Miami student loan and debt attorney may be able to assist you. An attorney can help you seek a discharge of your debt if you are eligible, or renegotiate the terms of a loan in order to avoid a default. Remember, a default may lead a lender to seek a judgment against you, which could lead to garnishment of your wages and seizure of other property. That is why if you are at any risk of defaulting on a student loan, you should contact the Law Office of Julia Kefalinos right away.

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