College loans tied to default rates

On Community College Spotlight:  For-profit colleges will lose eligibility for student loans if default rates are high, but the Educatiom Department says only five percent of programs —  “the bottom of the barrel”  — will be affected.

Also, the U.S. ranks 12th in the world in young college graduates. Canada is number one. President Obama and the College Completion Agenda want the U.S. to be a world leader again.

Finally, Top 10 lessons from NBC’s Community.

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  1. For a student loan, the quality of the education provided is in a very real sense the “collateral” for the loan…this is true for standard universities/colleges as well as for the for-profit ones. Hence, it makes sense to make the loans continent on one or both of the following two things:

    1)Require that the average salaries of graduates, some number of years after graduation, be at a level enabling repayment of the loan without undue pain.

    2)Require the institution on whose behalf the loan is made to hold on its own books, and be at risk for, a portion of the loan.

  2. tim-10-ber says:

    so…when will they do this for all education establishments…another solution would be to convert tax-exempt to tax-paying institutions based on their student loan default rate, lack of graduates, etc. Hmmm…that would raise the bar over night for admissions to colleges and might even bring back voc-tech to high school…

    now to create jobs…where did they go…


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