For-profit colleges and universities are trapping students in a cycle of debt by charging high tuition rates without providing the skills and knowledge needed to succeed in the workforce. In some of the most egregious instances, students are forced to pay back public loans even when a college closes or loses its accreditation. We funded the Project on Predatory Student Lending at Harvard University’s Legal Services Center to represent students in borrower defense claims. The center is currently working with students who attended schools operated by the now defunct ITT Educational Services and is seeking an injunction to stop the college from collecting loans made directly to individuals as well as restitution for students in bankruptcy proceedings.
We also funded a pilot to test the feasibility of income share agreements as an alternative form of financial aid. Under these arrangements, students agree to pay a small percentage of their income for a fixed period of time after they graduate. The debt is forgiven at the end of the term regardless of the amount the student has paid. Going forward, we plan to expand our investments aimed at advancing policies intended to improve student outcomes and the quality of post-secondary institutions.