The U.S. Department of Education plans to release its final "gainful employment" rule in October 2014. The draft rule, circulated by the department earlier this year, proposed cutting off access to federal financial aid for career-education programs (many of which are at for-profit colleges) whose graduates have high student loan default rates or high levels of student loan debt relative to their incomes. It is essential that the department adopt a final rule with strong protections for students.
During the month of May we asked students to submit their stories as public comments on the department’s draft “gainful employment” rule. Many of the student victims who have been exploited and defrauded by career-education programs offered compelling evidence of the need for stronger protections. Here’s what some of them had to say:
*Stories have been edited for grammar and clarity
For a full list of stories, go here.
James, Virginia
My story is like many others. I went to school looking for a better option and ended up getting suckered into ITT and being charged up to $50,000 in student loans just for a two-year associate degree. To make things worse, I didn't see any of my tuition money.
I went to school in 2005 and almost had to self-teach myself and others in class. One year later, I'm getting hounded by collectors (Sallie Mae) to pay my loans while I'm still in school.
I graduated in 2007. On TV people say they had job placements and help. My friends and I received zero help. It was pretty much you're on your own. Then I went in the Army in order to help pay off some of the private loans, in which I have no memory of signing for, since I was looking for grants most of the time. I paid off over more than half before getting out of the army due to injury.
In 2011, I had to defer my loans with collectors (Sallie Mae) due to the 14% interest rate I apparently signed for in the private loans back in 2006. In 2012, I lost the one job I had at the time and explained my situation to the collectors but ended up receiving threatening letters of being sued, due to delinquency, or lack of paying because the $300-$400 a month I was paying wasn't enough.
I have two jobs now, and I'm still paying off my loans. Recently I heard ITT was being sued, I hope I can testify.
Lara, California
I already had a B.S. degree in Computer Information Systems and worked in IT for 11 years. I got laid off from my job in 2007. A friend told me to go and enroll in Art Institute of California to learn Graphic Design, since I had an interest in Graphic Design.
When I went to the school, I asked them "How much it would cost?" They said it would be under $35,000. Next thing I knew, I was signing up papers. I went there to get some information, next thing I knew I was there for six hours. I was scared and panicking. They told me not to worry "Do what you like and the money will come later". To make the long story short, I had no idea "What I was getting myself into".
I witnessed them enrolling more and more students and the classes were full. They kept on promising that we would find jobs right after graduating. I witnessed more and more students quitting the college because they could not find a cosigner.
I have $100,000 student loan debt at this point. I had to file for bankruptcy because I could not find any jobs. My anger is more toward Art Institute. They keep on taking in more students by misinforming them about the job market.
Art Institute type of colleges should not be able to enroll students for $500 per credit by misinforming students that they will be able to find good jobs and be able to pay off their loans.
Donata, Indiana
I decided to finish my degree around 30 and decided to attend online since I was a single mother working secretarial jobs and knew I was better than this. I attended American Intercontinental University for Associates, Bachelors and Masters in Business. I believe I am now over $80k in debt which includes (I think) over $23 in private loans because for some reason I didn't have enough Federal Financial Aid to pay for my education. At times I had to pay out-of-pocket while only making $10/hour. Now after graduating in 2009 I was still making $10.50/hour and was expected to start paying back the private loans right away. I tried and failed and now my wages are being garnished for one of the student loans at a rate of almost $700/month. One of the private loans has gone from $13,500 to $41,000 and I get threatening phone calls every day trying to get this money. I currently get home with $1,800/month. I can't even afford health insurance at my job! After rent, food, and transportation I am almost tapped out. I work as an Admissions Advisor and believe education is the key, but some days it is hard to discuss education as an investment with this burden on my back. I cry often, but keep plugging away hoping one day I will be able to enjoy my life student-loan free. Now my daughter is attending DeVry University and I discuss her student loan debt with her frequently, but I see the same thing will probably happen to her with them charging her $678/per credit hour! Hopefully, something will change or my story will give caution to those thinking of finishing their education to be smarter than I.
Read the rest of the stories here.
