WASHINGTON — Students attending for-profit colleges are subject to subprime-mortgage-like loans that saddle them with thousands of dollars in debt and waste millions in taxpayer dollars, Democratic lawmakers and education experts said at a Senate hearing Tuesday.
The hearing of the Senate Health, Education, Labor and Pensions Committee came just days after the Education Department issued new rules to deal with the student-debt problem at career colleges, rules that those at the hearing said did not go far enough.
Republicans on the committee, who say committee chairman Tom Harkin, D-Iowa, has unfairly singled out the for-profit college industry in a series of hearings, boycotted the event.
Harkin pointed out that in 2009, for-profit colleges received $18 billion in guaranteed student loans.
Meanwhile, 57 percent of students who enrolled in 2008-09 departed without a diploma and with a high probability of debt.
Students at for-profits make up about 10 percent of all college enrollment but account for almost 50 percent of all loan defaults.
