Check your school’s credentials
Students should exhaust federal aid before turning to private options. But you may need to explore alternatives if you want to attend a non-accredited school or program. Accreditation is a process in which a third party reviews an institution or educational program — from its enrollment procedures to its curriculum and more — to ensure its quality. Only accredited programs can receive federal student aid.
If a school or program isn’t accredited, be cautious about taking on debt to attend it.
“The inexperienced learner may hand over their credit card, and next thing you know, their bill is thousands of dollars,” says Leah Matthews, executive director of the Distance Education Accrediting Commission. “And then [the school] disappears.” Federal loans can be discharged if a school closes while you’re enrolled. But you’d likely still owe other debt borrowed to attend the school. You can see if an entity is accredited via the Database of Accredited Postsecondary Institutions and Programs. For non-accredited options, look for other independent vetting — for example, if your state department of education has approved a career-based training program. “Non-accredited options [aren’t] bad or horrible; there’s lots of good quality out there,” says Matthews. But students must do their research, she says.
Determine the education’s quality
In an April 2020 report, the SBPC says alternative lending products are “frequently marketed toward borrowers at for-profit institutions.” If you’re attending such a school, make sure you not only understand what type of debt you’re taking on, but also if you’ll get your money’s worth. “There are good and bad schools in every sector of higher education,” says Steve Gunderson, president and CEO of Career Education Colleges and Universities, a national membership organization for career schools. “What matters is outcomes.” You can find those in the Department of Education College Scorecard. Look at information like median salary and median debt to help you better understand the potential value of a program.
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