Do your homework before choosing for-profit college

April 9, 2010 by Sally Kestin, Dana Williams and Diane C. Lade Sun Sentinel (MCT) NMSU Round Up

“Make the call that will change your life and get you on the right track toward a rewarding future.”

Sales pitches like that are helping to draw record numbers of students to for-profit schools that offer job training in everything from welding to massage therapy to medical billing. Buoyed by the recession, these money-making career colleges are filling a niche with skill-specific training, flexible schedules and online degrees. But behind the multibillion-dollar business and promises of better-paying jobs is a minefield for students, critics say. With costs that can exceed $30,000 for a two-year degree, many graduates emerge saddled with debt, and for some, a diploma that employers and other schools may not even recognize.

“The students who sign up don’t realize many times what they’re getting into,” said Angie Moreschi, an investigator at the James Hoyer law firm in Tampa, Fla., which is investigating several for-profit schools on behalf of students. “We’ve had students $100,000 in debt with degrees like fine arts and video game design, and they say they are never going to get jobs that will pay that back.”

The burden of much of that debt falls not only on students but the nation’s taxpayers. Many students finance these educations with federally backed student loans and are struggling to pay them back. Recently released U.S. Department of Education data show 44 percent of students in default on their federal loans after three years had attended for-profit colleges almost double the number at public universities.

Christine Cortez, a Coral Springs, Fla., single mother, plunked down $30,000 to attend the Institute of Allied Medical Professions in Delray Beach, Fla., for a diploma she hoped would lead to a medical job in ultrasound technology. But the school did not have an accredited ultrasound program at the time so Cortez is ineligible to take a certification exam that she said many employers require.

“I feel like I’ve wasted all this time and money,” said Cortez, who has been unemployed since graduating almost a year ago.

She is one of 14 former students who filed a lawsuit against the school in January for selling them “a bill of goods.” Institute director Karen Vidal said the suit is “baseless,” and the school is seeking to dismiss it. The ultrasound program is now accredited.


The debate over the legitimacy and value of non-traditional for-profit schools and colleges is growing as the industry has soared in popularity. The recession has seen enrollment mushroom with students eager to change careers, go back to school or increase their earning potential.

In Florida, more than 300,000 students attended for-profit colleges last year, an increase of 63 percent over 2004, according to the Commission for Independent Education, a division of Florida’s education department that licenses the schools. Students were enrolled in campus or online programs at more than 150 schools, the largest of which were Everest, University of Phoenix, Keiser University and Kaplan University. Keiser surveys its graduates six months after they get jobs and says that 90 percent are satisfied with their education.

“There are some great schools and there’s some bad schools,” said Chancellor Arthur Keiser. “I believe that we have as good a quality education as anybody in the country for what we do.”

Several other schools declined the Sun Sentinel’s requests for an interview. For-profit schools do not attract typical college students entering right after high school. Their base: lower-income, older students who may be working or have children.

Peter Waller, CEO of Corinthian Colleges, Inc., which owns Everest, summed up his company’s students in a February conference call on earnings: “They are 25- to 27-year-old average age, who frankly have got lost in life, and we are their lifeline to a career.”

But to critics, that lifeline may be more a handicap to some students at career colleges. They say the main motive at some schools is making a profit and that they mislead students with unrealistic promises through aggressive marketing.


During a recent episode of “Maury” on daytime talk television, half the commercials were for career colleges.

“I’m a medical assistant. I make more money than I ever imagined,” said a woman advertising Everest. “Get up and pick up the phone and make a better future for yourself.” With the toll-free number on the screen, a man’s voice added: “If she can do it, you can do it. Pick up the phone and call right now and start on the road to a rewarding career and a better life.”

Everest officials did not respond to requests for an interview. The parent company, Corinthian, is one of the largest in the industry and is projecting $1.75 billion in revenues this year. Everest’s Web site doesn’t list cost information, but an admissions representative told the Sun Sentinel that one program available at its Pompano Beach, Fla., campus offering an associate’s degree in criminal justice costs about $35,000. The school says that can lead to a job as a corrections officer, which at Florida’s Department of Corrections pays about $30,000 to $45,000 a year.


Career colleges make it easy for students to enroll with little or no money up front. Financial aid representatives help students line up loans. Even candidates with a bad credit history are not discouraged. Among the frequently asked questions on the website for Florida Career College, which has campuses in Lauderdale Lakes and Pembroke Pines: “My credit is terrible! Can I still receive financial aid” The answer: Yes.

“People are desperate right now to improve their skills and marketability because jobs are so scarce,” said Lauren Asher, president of the Institute for College Access & Success, a California-based nonprofit organization that studies student borrowing through its Project on Student Debt. “That adds up to a ripe marketing opportunity for for-profits: ‘Come over here. We’ll get you started right away, and boom, you’ll get a great job.’ For far too many, what it really means is you’ll take on a lot of debt that you won’t be able to pay back.”

Among graduating seniors in 2008, 96 percent of students at for-profit schools had loans compared with 72 percent or less of students at traditional universities, according to an analysis by the Project on Student Debt. They also came away owing the most: an average of $33,050, versus $27,650 for students at private nonprofit schools, and $20,200 for public university grads. The Career College Association, a trade organization, contends the higher borrowing is a result of the lower-income students attending their schools.

“They have more debt because they have fewer financial resources to begin with,” said spokesman Bob Cohen.

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