Tough Times Ahead For 16,000 Students Of Disgraced College Chain

After the biggest ever shutdown of a for-profit college operator, its students must choose between two equally bad options: clear their student debts, but lose all course credits, or keep the debt and hope for the best.

Don’t tell Natalie Anderson that she is better off without Everest College.

Until Sunday, Anderson was a student in medical assisting at Everest College in Phoenix. That day, she saw a message on Facebook: “This campus has been permanently closed.”

Anderson is unemployed, supporting two children on disability payments, and living in a Budget Suites of America, the only place she could find that came fully furnished. She’s “barely surviving,” she said, but dreams of becoming a nurse: “I want to get my kids off of the system.”

When she saw that Everest had closed, stranding her partway through her nine-month certificate, Anderson said, “I cried. Seriously, I did, because this was my chance.” Her voice broke: “Now I’m going to cry again.”

The saga of America’s largest for-profit college shutdown began last June and ended last week, when Corinthian Colleges abruptly shuttered 28 of its Everest and Heald college campuses. Since the beginning, when Corinthian began to teeter on the verge of collapse, there has been a tug between those who say Corinthian’s students are better off with their campuses closed — eligible to have their students loans forgiven — and those who say students should be allowed to finish their educations.

On one side was the Education Department, which pumped money into keeping Corinthian’s schools afloat while the company sought a buyer, and did everything it could to ease a sale. On the other side was California Attorney General Kamala Harris, who essentially blocked the sale of Corinthian’s campuses in her state by refusing to release buyers from liabilities connected to an ongoing lawsuit filed by the government.

In the end, 40,000 Corinthian students, those studying at campuses that were sold, will finish their degrees without disruption. Anderson and 16,000 others will not.

Which of the two groups of students are better off is not a question that will be answered for some time. The Education Department’s choice to enable students to continue their educations itself carries many risks: A BuzzFeed News investigation last year found that many students became disillusioned with Corinthian’s schools after they had graduated — when, they said, the school’s promises of job placement and career services crumbled, and they learned from employers and other universities that their degrees carried little weight. Jobless and mired in tens of thousands of dollars in debt, dozens of students told BuzzFeed News that they wished they had never attended Everest. Many others believed they had been coerced into enrolling in the first place.

It is for those reasons that many activists fought for a complete shutdown of Corinthian-owned schools, believing students were better off being freed of the debt they had incurred for an education unlikely to further their careers. But students whose schools were shuttered — 10,000 of them in California — now face a steep uphill battle if they want to get a degree somewhere else.

They have been given two options by the Education Department: get their loans discharged, or try to transfer to another school. Both choices come with high costs of their own; students must either start over again after months or years of hard work, or shoulder tens of thousands of dollars of debt in order to transfer just a fraction of their credits.

If they want to walk away from their loans, students must, in essence, walk away from Everest. The loan discharge option has been described by activists as a “clean slate,” but for many students, it feels like anything but: After devoting months and sometimes years to their degrees, walking away from hard-earned transcripts and consigning themselves to starting over feels like a loss.

“I’ve been working really hard at this, and it was a lot of work for me just to get to the place where I enrolled,” said Dominae Spears, a former student at Everest’s San Bernardino campus. “So of course I want to finish.”

The other choice, transferring credits, is equally daunting. Most schools do not accept Corinthian credits, even from campuses that are regionally accredited, and credits that are accepted often do not transfer directly toward degrees; instead, they are likely to count as electives or entry-level courses.

The choice to transfer even a single credit makes a student ineligible to have any portion of their loans discharged. That means that those who want to continue their educations will likely end up paying for credits they cannot use — sometimes to the tune of thousands or tens of thousands of dollars.

Many of the schools that do accept Everest Credits are for-profit colleges that have their own checkered pasts: Among schools recommended as transfer possibilities by the Education Department were for-profit chains facing Department of Justice investigations and Consumer Financial Protection Bureau lawsuits, and several that were so financially unstable that just this week they announced they were shuttering dozens of campuses.

Last Wednesday, Anderson showed up at Everest College-Phoenix hoping to get answers: She was angry and confused, and had been promised a Q&A session with Everest higher-ups. She found only a few former teachers and a librarian: The school’s administrators, she said, were hidden away in a break room off a hallway that was closed off to students. She peeked in on them drinking Starbucks. None ever emerged to answer her questions.

At the time, Anderson felt sure that she was going to try to transfer her credits to another school — she couldn’t imagine letting what would effectively be eight months go to waste, if you considered the four months she’d spent taking classes and the four months she would need spend retaking them if she chose to have her loans forgiven. She spent the morning after Everest closed calling all of the community colleges in the area, asking about transfers.

Anderson’s campus hosted a “college fair” for students who wanted to transfer their credits, though the atmosphere was far from festive: Many of the people in the room were simply crying, Anderson said. She took her transcripts around to several schools’ tables, almost all of which told her they could accept only one of her credits.

Some of the classes simply weren’t transferrable. But for the most recent course she had taken, Anderson had been scheduled to take the final exam on Monday, the day after Everest shut its doors for good. She learned that, despite having taken the entire class, she wouldn’t get credit.

It didn’t seem worth it to try to transfer any credits, Anderson said. Instead, she plans to start over. In the meantime, as she finds another school and retakes her classes, she doesn’t know what she’ll do to support her kids.

It will take more time than Anderson, who speaks urgently of “getting my kids off the system,” feels she has. Like many Everest students, she has already exhausted much of her financial aid eligibility — the federal government caps the amount of loans and grants students can take out — at other schools. She’ll have to wait 60 days for her loans to be officially discharged, and her Pell Grants restored, before she can enroll in a new school, a process that could take as long as three months.

Students at the shuttered schools used words like “devastation” and “heartbreak” to describe the past week. Several said they had been “left with nothing.” Many are also angry.

Attorneys general, Education Department officials, Corinthian executives: To Anderson, they all seem the same. “Everything domino-effected, and everything’s gone for me now,” she said. “Sort of everything everybody’s saying is, ‘This is the best for students,’ but to me it just seems like everybody’s finding a way to screw me over.”

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