For-Profit Colleges

Advocates for students warn that they can be exploitative—and nothing more than an instrument that leads to additional debt.

The SBPC, which advocates for borrowers’ rights, released a report in July showing for-profit colleges disproportionately established themselves in minority communities and engaged in predatory practices leaving students in significant debt.

The Student Borrower Protection Center (SBPC) analyzed where for-profit postsecondary institutions located themselves and found patterns suggesting that for-profit schools target neighborhoods composed mostly of people of color.

These direct school-to-student loans have ensnared hundreds of thousands of students at for-profit colleges. When students borrow directly from a college, they aren’t protected by the same government safeguards they would have if they took out federal loans. The colleges can demand payments while students are still in school. They can withhold transcripts for nonpayment. They can impose onerous interest rates, reaching into the double digits.