The 500 colleges where former students aren't repaying their loans, and why

Key Points:

• Recent federal data reveals that over 500 U.S. colleges, mostly for-profit, have at least 40% of recent federal student loan borrowers not repaying their loans, with some schools exceeding 50% delinquency or default rates.
• Many of these institutions heavily rely on federal student aid for the majority of their revenue, raising concerns about taxpayer money supporting schools with poor student outcomes and high loan default rates.
• The data highlights systemic issues in for-profit career training schools, where students often incur large debts for low-quality programs that fail to lead to gainful employment, exemplified by cases like UEI College and Florida Career College.
• Current federal accountability measures for schools with high default rates have been ineffective, but new tests based on graduate earnings and loan repayment outcomes are set to be implemented by 2027-2029 to better protect students and taxpayers.
• Advocates and experts warn that without stronger oversight and consequences, vulnerable students will continue to be targeted by predatory lending practices, leaving them with debt burdens and limited career prospects.