Are For-Profit Online Colleges a Rip-Off?

For-profit online colleges are sometimes more expensive, but they aren't always a rip-off. Image Source / Getty Images

As online colleges have become more popular, many students have enrolled in for-profit schools like Devry, Kaplan, and the University of Phoenix. Such programs usually offer a student-oriented education geared towards working adults that don’t have the time for traditional courses. But, critics within Congress and the education community are concerned that for-profit online programs make over-the-top promises and rip students off.

Are for-profit programs really so bad? Learn the facts and decide for yourself.

How Are For-Profit Online Colleges Different From Traditional Private Colleges?

A number of reputable colleges are private programs, not a part of any state school system. However, the larger traditional private universities tend to operate on a non-profit basis. While administrators may be paid a hefty salary or tuition funds may be continually used for bigger-and-better buildings / sports facilities / pet projects, such schools are not businesses and do not seek to earn a profit. Any extra money these schools generate is invested back into the schools themselves.

Comparatively, for-profit online colleges are businesses. Like other businesses, their ultimate goal is to generate a profit. For-profit programs have less of an incentive to invest as much into the school itself because any such investment cuts into the bottom line of the business.

What’s the Problem with For-Profit Online Colleges?

Critics contend that for-profit online colleges use unethical admissions gimmicks. Since each student represents a dollar amount to the school, admission standards are often particularly lax and unprepared students are often permitted to take courses.

Online college admissions “counselors” have been accused of misleading potential students by promising that they will graduate with a degree and be able to immediately get a lucrative job. Often, tuition payments and potential financial aid options are not fully explained until it is already too late for a student to withdraw from the current semester. In some cases, students have been lured into programs with the promise of gifts such as “free” laptops that were added to the students’ tuition bills.

Some for-profit online students have complained that the courses were overly simple, that instructors did not provide individualized attention, and that too many students were put into the same course sections. Online instructors in these programs are usually underpaid adjuncts that teach in addition to a regular job and are required to follow a strict curriculum and method of teaching and grading. Many note that this is a factory-line type of education.

Graduates and former students of for-profit programs sometimes encounter problems with using their transcripts when it comes to furthering their education or getting a job. Many of the larger for-profit online colleges are properly accredited; however, that doesn’t ensure that other universities will accept their credits.

Sometimes, a student will encounter trouble transferring to another school or applying to a graduate program with a degree from a for-profit school when that degree will be compared against degrees from more prestigious non-profit universities. Some workplaces will happily accept degrees from accredited for-profit schools, while others will carefully consider the reputation and public perception of the program the student graduated from.

What Benefits Do For-Profit Programs Offer?

There are certainly some benefits to choosing an online for-profit program. For some students, these schools have made it possible to earn a degree when similar options simply didn’t exist in the non-profit market. A for-profit college is able to offer a huge variety of degrees and usually has substantially more options than any individual non-profit program.

Additionally, for-profit schools tend to consider themselves “student-centered.” Instead of focusing on research and academic tradition, these schools focus on preparing students to be competitive in the workplace. Many working adults appreciate the option of taking courses that directly relate to their field of employment and learning from instructors that are currently working in that field rather than professors that are entrenched in academia.

For-profit programs are also known for offering flexibility. Many of their graduate programs do not require students to have a residency period in which they must fly out and learn on campus. Since many for-profit programs have satellite locations all over the country, students often have options near home when it comes to required supervised testing.

Another potential benefit is that the lax admissions standards discussed above may actually be a benefit to some adult learners that simply need a second chance. While the loose requirements may be a disaster for unprepared students, some adult learners find themselves unable to gain acceptance to any schools after slacking off in their younger years. For-profit programs give them the opportunity to prove themselves.

What Can Be Done About the For-Profit Problem?

The problems surrounding for-profit programs have been a hot topic of discussion in Congress. During the past several years, many options have been discussed including requiring for-profit colleges to meet minimum standards or cutting off federal student aid at schools with too many graduates that are unable to become gainfully employed.

Under such heavy criticism, many for-profit programs have come together to self-regulate their industry as The Coalition for Education Success and have agreed to practice more ethical recruiting and program-creation standards. In the coming years, both legislation and self-regulation are likely to help the for-profit college market improve.

Jamie Littlefield is a writer and instructional designer. She can be reached on Twitter or through her educational coaching website: