The ITT Technical Institute recently closed its doors, leaving tens of thousands of students with a high scorecard of debt and possibly worthless college credits.
On Sept. 6, the ITT said that it is ending its operations. The educational venture operates in 35 states, where it serves 45,000 students in 140 locations. Pulling the plug on the ITT will axe the jobs of 8,000 employees of the institution.
The shut down of ITT comes in the wake of intense scrutiny from the Department of Education, which claims that the educational company enticed students to sign up for federal loans under the false promise of blooming employment opportunities after graduation.
No sooner than last week, an announcement from the U.S. Department of Education clarified that ITT was no longer permitted to enroll new students under federal aid.
Secretary of Education John B. King Jr. explains that the decisions taken by the school's administration placed both its students and millions of dollars in taxpayer-funded federal student aid in a risky position.
He goes on to say that the decision taken by the Department of Education was not taken lightly, but it was necessary to lower said risk.
In 2015, the ITT called almost $850 million in total revenue, $580 million of which arrived via federal student loans. This meant that attending ITT costs $23,000 per year, while the annual national average payment for public colleges was only $16,000.
At the national level, ITT reported a quarter of its students graduating, while at least 30 percent of them default on their student loans.
According to declarations from representatives of the government, students who attended ITT using federal loans can be freed from those debts discharged. To get a full idea of the process, read all about it here.
Courtesy of the Education Department, a number of webinars are available to ITT students on Sept. 7 at 10 a.m., noon and 2 p.m. EST. Check them out.
Another sensitive subject refers to the credits that students earned fair and square during their time with ITT. According to the Education Department, students will be able to transfer their credits to another institution. This applies particularly to those who are zeroing in on graduation.
On the other hand, ITT warns that it is very less likely that other institutions will accept credits earned by its former students.
By visiting ITT's site, users can peruse the list of schools that accept its credits for degrees. Don't get your hopes up just yet, as the single institutions listed are other ITT schools. This could mean that the credits earned with ITT are worth less than the paper they are written on, at least when other universities are concerned.
King acknowledges that the lockdown of ITT will discourage a lot of young learners, but he encouraged students to stay in school, whatever this might imply.
"Higher education remains the clearest path to economic opportunity and security," King says. Regardless of the economic setbacks of getting educated in "a high-quality, reputable institution," on the long run, it is a great opportunity.
It may be true that paying up for student loans can delay young people from starting their own business, but it may also provide them with the maturity necessary to make that venture functional, once they start.