Are for-profit colleges in trouble?
Two for-profit higher-education institutions have announced the closing of multiple campuses nationwide. The Education Management Corporation and the Career Education Corporation will shutter the doors of more than 25 campuses across the country.
The Art Institute, Sanford-Brown College, Sanford-Brown Institute, and maybe soon, Le Cordon Bleu culinary school, are all set to close soon.
According to the Chronicle.com, the Art Institute has almost 5,500 students enrolled and the shutdown process will likely take three years.
All students impacted will have the choice of remaining enrolled in an effort to graduate prior to the schools closure or transfer to another college.
Due to massive debt, both corporations can no longer afford to keep many schools open and have been forced to layoff employees.
The for-profit college industry has received biting criticism lately. Earlier this year Corinthian shut its doors due to heavy fines and probes from the federal government. Everest College, maybe its most popular campus, is included under the Corinthian umbrella as well as Heald and WyoTech.
Students from Corinthian are in the process of fighting the United States Department of Education to have their student loan debt wiped away.
That process just got a little tougher as Corinthian has filed for bankruptcy protection, so if the students, or the Corinthian 100, plan to sue for debt forgiveness, Corinthian’s bankruptcy protection filing would potentially shield them from being held liable for the students debt.
This news of more for-profit colleges closing will hopefully spring Congress into action regarding how these institutions operate. Corinthian received nearly 90 percent of its revenue from federal student loans because tuition to attend these schools was astronomical.
Because student loan debt has become so burdensome, individuals are having to defer large purchases like a home or car. Any student who attends a for-profit institution and the school decides to shut down, those students should have their loan contracts reviewed with the real possibility of having their entire debt forgiven.