How bad are "for-profit" schools? (kinda long)

So I know the general consensus is that for-profit schools are bad; by design they primarily serve share holders rather than students and that they are oftentimes guilty of saddling their graduates with tons of debt and few job opportunities. There are usually far better avenues for higher ed available (community college, commuter schools w/ larger non-trad populations, etc.)

With that said, are all for-profit schools equal in how… lousy they are? I recently reconnected with an early childhood friend and found out that she is attending one of the The Art Institutes - a for profit art school system with I believe over 50 locations. She’s studying fashion design. She’s a freshman (19 years old.)

I am really, really worried because she grew up in less than ideal circumstances. Her father was not in the picture (serving life sentence in prison) and her mother lived in a subsidized housing project with her 7 children. I feel as though this is the target demographic for a lot of for-profit schools (judging by documentaries I’ve seen on for profit schools + the nature of their daytime commercials.) For-profit schools seem to market themselves as an easy way out of poverty which appeal to a lot of people since the degree programs are usually accelerated and times are really flexible.

I was wondering if I should reach out to my friend and advise her to perhaps “get out” so to speak while she still can and go to a community college. She has an immense amount of respect for my Dad (a community college professor) and she’s always seen him as a sort of father figure when we were younger - he’d take her along with us on trips, drive her to school with me, etc like a daughter/niece. I might not necessarily speak to her personally but rather have my father do it instead. My father has had students go through community college and transfer to MIT, Boston College, Amherst College, etc - he knows first hand how many possibilities are available through CC. With her income level, she’d most definitely get significant grant aid (Pell, etc) and could attend for basically free. The CC is only a subway stop away from her house which would mean easy access as well. If she were to transfer to a 4 year afterwards, she’d most likely get similar generous aid there too.

I feel like I’m getting off track. My point is - the program she is in is 36 months long and costs 100,000 dollars (96k tuition plus supplies, fees, books, etc) – an additional 40k for room and board but she is commuting from home. If this is being financed through loans, she will be graduating with 100k in non-dischargable debt. I’ve read about a dozen articles about Art Institute graduates with 100k+ in debt and no job opportunities. But I do not, for sure know that the Art Institute is THAT bad and that perhaps she does have a decent shot at gainful employment post-graduation or that perhaps her debt load isn’t that much. I don’t want to get ahead of myself and impose an unwanted suggestion. But if things really ARE that bad, I’d feel guilty for not offering what I believe to be genuinely helpful advice. A lot of her friends are at this specific community college so it isn’t as though she’d be insulted or anything.

In terms of for-profit schools; are there reasonable, viable options? Are there “lessers” of the evils? Am I just getting ahead of myself? College Confidential has always been an exceptional resource - and I find that the parents of College Confidential often provide the most helpful and insightful advice and guidance.

whAT!!? $100k?! I wonder what the starting salary is for graduates, if they can even get jobs?! What is the interest rate? Does interest start accruing immediately?

How many months ago did she start? Are there penalties for withdrawing early?

Read the Wikipedia entry for The Art Institute - legal troubles, fraud, agressive student recruitment!

http://m.ocregister.com/articles/students-612171-loans-company.html

@Madison85‌ The school did not report what percentage of their graduates found employment after graduation - it was just an * next to “percent of graduates employed after program” and the footnote said that the school wasn’t required to publish that information… Which seems really suspicious. I can’t imagine that the starting salary is that high, to be quite honest. And I actually just came across that article before I posted this question - it was one of the red flags that prompted me to ask whether or not my Dad/I should intervene.

Edit:
Sorry - I forgot to address your other questions. I do not know if there is a fee/penalty for early withdrawal. She began the program in September of 2014.

http://petapixel.com/2011/09/02/us-gov-sues-the-art-institutes-for-11-billion-fraud/

Something doesn’t add up here.

She doesn’t have the loans in her name and no one is going to let a mother in a housing project with 7 kids cosign 100k worth of loans.

@romanigypsyeyes‌ That’s what I was wondering about too - the program says its 96k for 36 months and we aren’t talking about Harvard where there’s a reputation for generous grant aid. I watched a Frontline documentary (I forgot what it was called, something like College, Inc) and all the people they interviewed were very low income but had 6 figure debt. The school’s website has one of those “Chat with a Representative now!” features so I was going to ask about the details of financing the program and whatnot.

Hopefully this works:

http://i62.■■■■■■■.com/29qm5i9.png

Are they handing out parent plus loans…

“The Federal Parent PLUS loan can be deferred while the student is in school on at least a half-time basis and for six months after the student graduates or drops below half-time enrollment. The interest will be added to the loan balance if it is not paid as it accrues. This can increase the loan balance by about a fifth. Eligibility for the Federal PLUS loan does not depend on the borrower’s credit scores. Eligibility also does not depend on income, debt-to-income ratios or debt-service-to-income ratios. The eligibility criteria also do not consider whether the borrower owes other types of debt. A Federal PLUS loan borrower must not have an adverse credit history, which is defined in the regulations as involving a current delinquency of 90 or more days on any debt or a five-year lookback for certain derogatory events, such as bankruptcy discharge, foreclosure, repossession, tax lien, wage garnishment or a default determination.”

It doesn’t look that difficult. Actually all it takes to accept is a few clicks.

@marie1234 - I believe there’s a stickied thread on the dangers of PLUS loans - and a lot of people’s worries have to do with how easy it is to apply (and be approved.)

If it is a PLUS loan then it is in the parent’s name, not the student’s.

Not that I’m saying this is good, but it’s not like she will have 100k in debt coming out- her mom will.

I would actually have your dad talk to her if she is close with him.

Romani there are families that don’t divvy up the debt that way. They are all in a mess. It’s not like the kids graduate and go off a be famous fashion designers while mom watches TV and makes payments. lol.

look at what I said, marie. I said that it was in the PARENT’s name. I didn’t say anything about who would be paying it back. Legally, it would not be on her.

I’m not saying she WON’T pay it. I’m saying that she isn’t required to pay it like she would be if it was in her name.

Yes, I realize that but that information doesn’t help this family at all is my point. Obviously, they should not be doing this. It’s a horrible idea for just about every reason imaginable.

Yes, it is a horrible idea. And I can’t honestly believe the school puts that disclaimer in its Q&A. They may not be “legally required” to calculate or publish their job placement rate, but they ought to do it anyway. What a scam.

Please encourage your dad to reach out to her. **I think there’s gonna be a special place in hell for people who exploit the poor in such a crass way.

It’s going to be crowded down there.

Parent Plus loans are not bad, when you carefully know what you are doing and how you will pay it back. But a mom in that situation would be heaping worse on top of bad.

If these are student loans, you’d need to somehow learn what sort and whether they start due, if she leaves the AI.

I do think you should try to speak with her. It may help if you knew how the cc’s art programs could meet her wants, maybe had a little info to offer. She may now see things with different eyes than a few months ago. You could talk, kid to kid, then offer that your dad would be willing to help. It’s tricky when we insert ourselves, so make it a comfortable talk. A few times, I found it helpful to mention thoughts that circulate on CC, as a gentle outside reference.

Yes, show your friend all of the evidence you have found on her “school.” She is being exploited. Her real education should start with recognizing this fact so that she can move on and go to a real college.

How bad are they: here is one datapoint for you.
I do quite a bit of hiring and have done so for decades.
In general for most positions I would consider someone with a “degree” from a for-profit school as having no degree for the purposes of evaluating their application.