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The government is trying to crack down on the countries for profit schools.
Students at these schools are often taking on too much debt to attend college is that the do nothing for their job prospects.
Most students to career colleges and vocational schools pay tuition with federal financial aid dollars as much as 90% of the schools revenue -- come from the government.
But that leaves taxpayers on the hook if students can't find good jobs and they default on their loans.
And yes what they're defaulting in big numbers students at these institutions represent just 12% of all higher education students.
But nearly half 50%.
Of all student loan dollars in default.
The average student earning an associate degree -- a form for profit school carries 141000 dollars in federal loan debt.
Now compare that to zero dollars in debt burden of most community college students.
The Department of Education last upgraded rules to rein in deceptive advertising and -- schools from paying enrollment counselors based on how many students they sign up.
But due to heavy lobbying the rules have been delayed and now the final version of the DOE's role is much softer than its original incarnation.
Under the original terms programs that failed to meet the criteria would have lost federal loan that eligibility immediately and enrollment would have been frozen.
The -- rule announced today -- schools multiple chances over four year period to improve their stats.
It's not really until after three strikes -- school lose eligibility for three years.
Specifically schools will only be able to get federal pay tuition if at least a third of its former students are repaying Merrill months.
Or the estimated annual loan payment of the typical graduate must not be bigger than a third of his is his or her discretionary income.
DOE expects 18% -- for profit schools programs to fail its tests at some point but only 5% will likely lose eligibility.
The news of the easier rules and education stocks soaring today including shares of the nation's largest chain called Apollo Group which owns the University of Phoenix.
It rose 13% for ending the day down nearly 2%.
Now that success is nothing new for Apollo Group which is seen revenue and net income grow about eight fold since 2000.
And stock more than quadrupled.
So schools have been trying to get out in front of the new lives and adapt their business models to the new reality.
For example Apollo now offers a free three week orientation -- helps weed out on prepared students without charging them.
The Washington post's Kaplan education division has also put in place a pre trial period before students have to commit.
And Career Education Corp.
is making new online undergraduate students pass the college prep course if they haven't attended college before.
Look it's good Washington is finally taking notice of these sub prime programs some not all of these colleges -- But a lot of the burden must also rest on the student.
Look at the end of the day they have to -- -- wants against the cost of an education.
Because -- you pay too much you'll end up short changing your future in other ways she may never have expected.
Such as delaying buying a house or even having kids.
Look compare -- likely starting salary from a website like salary dot com with your monthly debt burden.
If you're gonna go into -- field the pays little considering his institution that doesn't charge.
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