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In times of economic difficulty, many people
decide to bolster their qualifications by
seeking more education. Unfortunately, where
there is money and desperation involved,
scam artists are the first ones to recognize
a promising new trend.
Over the last six months, enrollment in
community colleges has increased by 26%.
That is a good sign, since community
colleges offer accredited degree programs at
a reasonable price, which can help people
qualify for better-paying jobs.
Unfortunately, enrollment in trade schools
and online universities is also increasing
dramatically, and the students who attend
those institutions rarely get value for
their money or hard work.
Recruiters for trade schools and online
universities are very skilled at persuading
mostly young and unsophisticated students
that the exorbitant tuition charged for
often-worthless degrees is justified. And
Sallie Mae, the student loan giant that also
is the leading lender for traditional
student loans, is the top lender for trade
schools, offering a “Career Training Loan”
with an exorbitant interest rate of 15.24%.
That rate is variable, and will increase as
federal loan rates increase.
Since Kaplan University, one of the leaders
in this field, charges $65,000 for a
three-year online criminal justice degree, a
15-year loan repayment plan at the current
interest rate would require monthly payments
of about $900. Since most trade school
graduates earn around $30,000 to start, that
kind of loan repayment is virtually
impossible to maintain. As a result,
students who attend non-traditional programs
are saddled with massive debt and a
virtually worthless degree.
The reason trade school and online
university degrees are such a risk is that
they are not properly accredited, and
credits and degrees earned through those
schools are not transferrable or recognized
by accredited institutions or potential
employers. One student in California who
spent $60,000 and three years earning a
criminal justice degree from a trade school
is now suing that school, after being
rejected by every local, state, and national
law enforcement agency to which he applied.
Since less than 40% of students who begin
trade school even finish the course work,
the majority of them end up with not only a
huge student loan debt, but absolutely
nothing to show for their money. Student
loans are one of the few types of debts that
can lead to garnishment of tax refunds and
Social Security benefits, and are not
dischargeable in bankruptcy. Unfortunately,
a brief encounter with a trade school can
lead to a lifetime of financial difficulty
and make it impossible for a person to
borrow funds later to get a legitimate
education.
Kraft & Associates is a federally designated
Debt Relief Agency under the United States
Bankruptcy Code. We assist people with
finding solutions to their debt problems
including, where appropriate, assisting them
with the filing of petitions for relief
under the U.S. Bankruptcy Code.
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