Friday, November 27, 2015

For-profit schools score more US-funded deadbeat loans

Lincoln Tech and CHI Institute borrowers showed highest Philly loan-default rates

For-profit schools score more US-funded deadbeat loans


One-fourth of the students who used federal student loans to pay for classes at for-profit schools in 2008 have defaulted on their loans, up from 21% for 2007, writes FBR Capital Markets analyst Matt Snowling, after reviewing new US Department of Education data.

Default rates are rising, in part, because under Obama DOE is tracking borrowers for three years after they're in school, not just 2 years as in the past. The 2-year limit enabled schools to apply for deferments, Snowling told investors in a report; borrowers still went bad, they just didn't show up in a school's stats.

Local schools with the highest default rates:

Lincoln Technical Institute's Philadelphia campus, where 47.5% of the school's 2008 borrowers took taxpayers' money and ran;

CHI Institute - Broomall, 34.9%;

CHI Institute, Philadelphia, 31.4%.

Chi is owned by Stanley Kaplan and the Washington Post Co.

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PhillyDeals posts interviews, drafts and updates that Joseph N. DiStefano writes alongside his Sunday and Monday columns and ongoing articles about Philadelphia-area business.

DiStefano studied economics, history and a little engineering at Penn. He taught writing and research at St. Joe’s. He has written for the Inquirer since 1989, except when he left a few times to work at Bloomberg and elsewhere. He wrote the book Comcasted, and raised six kids with his wife, who is a saint.

Reach Joseph N. at, 215.854.5194, @PhillyJoeD. Read his blog posts at and his Inquirer columns at Bloomberg posts his items at NH BLG_PHILLYDEAL.

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