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Non-Profit Colleges See Spike In Loan Forgiveness Claims

The College Invester

Mark Kantrowitz
March 24, 2025

Key Points

More than 20% of borrower defense claims involve public or private nonprofit colleges, not just for-profit schools.
Approval rates for private nonprofit college claims are double those for for-profit institutions.
Complaints often focus on employment outcomes, program cost, and credit transfer, varying by institution type.
The borrower defense to repayment program is often associated with students defrauded by for-profit colleges. But newly obtained federal data paints a more complicated picture—one that reaches far beyond the for-profit sector.
According to recent data obtained in response to a Freedom of Information Act request, 22% of all borrower defense claims involve public and private nonprofit colleges. Even more surprising, applications involving nonprofit colleges had a higher approval rate than those filed against for-profit schools: 50% compared to just 23%. That data contradicts years of assumptions that borrower defense issues are isolated to one sector of higher education.
The allegations span a wide range of misconduct, from overstated job placement rates and inflated program costs to false claims about accreditation and credit transfer. And while the bulk of claims still stem from for-profit colleges, the presence of nonprofit and public institutions in this space suggests a broader pattern of student issues.

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Trump’s Plan to Move Student Loans to SBA Raises Concerns

Inside Higher Ed 

Katherine Knott
March 21, 2025
The administration, which wants to close the Education Department, hasn’t said how it would move the $1.7 trillion portfolio to a new agency. Democrats say doing so would be a “clear violation” of the law.
A day after White House officials said the Education Department would administer the student loan program, President Donald Trump announced that the Small Business Administration would be taking over the $1.7 trillion portfolio.
He told White House reporters that the move would happen “immediately,” though he didn’t say how that process would work. Currently, federal law requires the Education Department to manage student loans, so the president doesn’t have the authority for the move, several experts and advocates said Friday.
Neither the White House nor the Small Business Administration responded to requests for more information or details about the plan.
In response to questions about how moving loans to SBA would work, the Education Department referred Inside Higher Ed to an interview that Education Secretary Linda McMahon did Friday with Fox News. McMahon said she’s working with the SBA on a strategic plan.

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Pathways College

Primary Contact:

Daniella Baker – CAO

Email: ella@pathwayscollege.edu

64 E Broadway Rd, Suite 200
Tempe, AZ 85282

Phone: (480) 870-8900

Website: Home – Pathways College | Flexible, Online, Accredited Degrees

The vision of Pathways College is to create a post-secondary choice for students who are underserved in our communities by providing a quality education that is personalized and accessible without generating the burden of debt to the student or their family.

 

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