Report Criticizes Loans Offered by For-Profit Colleges

February 1, 2011

For-profit college have moved in recent years into offering institutional loans to students, and this trend needs more scrutiny, according to a report released Monday by the National Consumer Law Center, which conducts research on behalf of borrowers. According to the report, high default rates suggest that "schools seem to view these loans more as 'loss leaders' to keep the federal dollars flowing" than as a form of financial aid. Further, the report says that in some cases, the terms on loans are "predatory."

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