For-profit universities in the United States have to abide by the 90/10 rule: only 90% of tuition $ can come from federal student loans, the other 10% have to come from other sources. Want to rock the education space and drive tuition down? Make it an 80/20 rule. Or 75/25 rule.
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Replying to @AustenAllred
Please do educate me. What’s the difference between gov student loan vs a school extending line of credit? Just curious.
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Replying to @Ann_Nav
If you came to a school and said, "I'd like to take out $250,000 from you for a social working degree" a school would say, "No, we'll never make our money back." If you come to a school and say, "I got $250k of loans from the gov, will you take it" the school says, "Yes"
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Replying to @AustenAllred
Thank you though I feel I may be missing something. Ie if the fee is $250k and gov pays 75% and rest you have to come up yourself, how is that driving Uni fees down? The only time I see Uni fees going down is if gov negotiates and provides subsidies than passing cost to students?
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It's not that the gov pays 75%, it's that only 75% of their tuition dollars can come from the government, then other 25% need to be paid out of pocket. They have to cater to people able to pay out of pocket, which forces them to drop prices
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