6 Signs Your College Is a Scam


A college degree opens doors. While there are certainly ways to find professional and financial success without a college degree, it can be a harder and longer path. The relationships built, the skills learned, the knowledge granted, and the credentials earned open pathways that might have beyond an individual's reach.

However, not all colleges in the United States deliver the type of education that will lead to financial success. ITT Technical Institutes' recent and sudden closure after it was barred from admitting students utilizing federal funds, was a reminder of that fact. The closure of the school put the educational and financial prospects of thousands of students in jeopardy.

Prospective students need to remember that technical schools and colleges — even nonprofits — are run like businesses. They won't necessarily broadcast that they aren't capable of delivering the type of education you expect. It's up to you to investigate the school and discover any red flags that indicate the college is a total scam. Here are a few warning signs to look out for.

1. It's in Poor Financial Health

ITT Tech's closure due to financial issues isn't an isolated, once-in-a-blue-moon incident. Inside Higher Ed reports that on average, five colleges close down annually. The number of college closures per year is expected to triple in the coming years as admission rates at smaller colleges drop. Smaller private and public colleges are dependent on tuition to remain financially viable. This means that years of low admission rates can result in a slow, prolonged death for the college which can blindside students.

When a school closes, students might need to:

  • Restart the school vetting process;
  • Pay admission and application fees for new colleges;
  • Find an institution that will transfer the most credits;
  • Potentially apply to have federal loans discharged;
  • Contend with issues keeping housing benefits.

In order to avoid enrolling in a college that might go under before you graduate, potential college students can check the financial health of their college by doing a Google search about the school's financial health or admission rates.

2. It Lacks Proper Accreditation

Proper accreditation is vital to a degree or certificates' worth. According to RuthAnn Althaus, a program coordinator at Ohio University, accreditation is vital because it "provides assurance to students, their employers, and the U.S. Department of Education (DOE) that institutions are meeting rigorous educational standards and are professionally sound."

If you accidentally attend a college without proper accreditation, you will not be qualified to work in a field that requires a degree, and employers might not recognize your degree as a valid educational credential. You can ensure that the institution is accredited by searching for the school's website for the accreditation information. Be sure to double check the accreditation claim on the accrediting institution's website.

3. Does It Have National or Regional Accreditation?

There's another layer to the accreditation conundrum. In the U.S., colleges and programs can either be regionally accredited or nationally accredited. Accreditation from nationally accredited institutions (a lot of for-profit schools fall into this category) are often not recognized by public colleges.

ITT Tech students are currently dealing with this issue. Due to the fact that ITT Tech was nationally accredited, students have very few options as they attempt to find a replacement school. Right now, ITT students who want to transfer to another school are limited to other nationally accredited schools and the few community colleges that are willing to consider transferring their credits.

Before you apply to a nationally accredited institution, you should seriously consider if you would like the option to eventually transfer to a regionally accredited institution.

4. The School Is Facing Accreditation Probation or Withdrawal

Accreditation isn't a lifetime endorsement for a college. Accredited institutions must continually prove that they meet the required educational and financial standards to keep their certification. Schools that fail to meet standards can be placed on probation.

Enrolling into a college that is in a probationary period is risky. Failure to improve can lead to the institution losing their accreditation either voluntarily or by having it revoked. The loss of accreditation will mean that if you want a degree that is actually worth anything, you will need to transfer to another school. If this happens in the middle of the semester, you can lose time and money.

5. It's Linked to State or Federal Investigations

State or federal investigations of the school or its accrediting agency might be a sign that the school will not be a good investment. While not all investigations indicate wrongdoing, in recent years, the federal and state investigations of ITT Technical Institutes resulted in the Department of Education barring the school from utilizing federal aid to enroll students. That restriction led to the collapse of the school.

When accrediting agencies are investigated, the fallout can be even more extreme. ACICS, the agency that accredited ITT Technical Institution, has been recommended for termination after a federal investigation. If the recommendation goes through, every college ACICS accredits will have 18 months to get recertified with a different agency. Those school's ability to find another certification agency to endorse them really depends on the quality of the institution and their financial health.

To be safe, before you enroll in a college, you should search for any news of investigations of the colleges you are vetting or the agency that accredits the college. If the investigations have to do with the school's finances or recruitment practices, you might want to dig a little deeper into the investigation before enrolling.

6. It Has Low Freshman Retention and Graduation Rates

Enrolling in a college with low student retention and graduation rates is an extremely risky endeavor. While you shouldn't discount a school entirely due to low rates, it should at least be a warning sign that should lead to further investigation.

Low rates can be the result of:

  • Students transferring to another school before graduation;
  • Students taking more than four years to graduate;
  • Low emotional and academic student support and guidance by teachers and advisers;
  • Lower academic standards for admission.

You can check the rates of colleges utilizing the website College Scorecard.

Colleges whose rates are around the national average — you probably don't need to investigate further. If the college has lower than average rates (10%-20%), that might be a major red flag to take into account before enrolling. You should at least prepare yourself for an uphill battle in your quest to earn your degree.

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