Public Employee Press

WARNING: Unaccredited trade schools can rip you off

Just as predatory lenders saddled millions of working people who dreamed of owning their own homes with sky-high mortgage payments, many unaccredited for-profit trade schools are taking advantage of working adults trying to achieve the dream of a college degree.

The schools offer students help getting financial aid and promise lucrative careers. But after the schools fill their coffers with their pupils' borrowed money and taxpayer-funded federal grants, too many of their students end up with huge debt loads. Many learn only later that the program they completed is not accredited and cannot help them make a living or pay off their loans.

25% default on loans

Federal aid is central to the profi ts of these schools, which suck in around $1 of every $4 of federal Pell grants for students in need. And according to the U.S. Dept. of Education, up to 25 percent of students at the commercial colleges default on their student loans within three years - compared to 11 percent or less at public institutions and private nonprofit colleges.

Obama taking action

The Obama administration is planning new "gainful employment" regulations to "protect students from taking on debt they can't afford in exchange for a certifi cate they can't use," said Justin Hamilton of the U.S. Education Dept. Beginning in 2012, colleges with student default rates above 30 percent for three consecutive years would lose their eligibility for federal financial aid.

It is particularly important for DC 37 members to avoid for-profi t career schools in favor of the kinds of schools that will be represented at the union's April 28 College Fair, because the DC 37 Education Fund only reimburses members for tuition at accredited institutions (or job-related Civil Service advancement courses).