"This initiative speaks volumes to the economic realities facing many schools,” the email said.
For-profit universities differ from typical nonprofit universities in that they are owned by shareholders and thus must turn a profit in order to continue operation. These schools usually have some kind of national, rather than regional, accreditation.
For-profit universities tend to be more expensive than non-profit universities, but their appeal is the accessibility to non-traditional students by offering more flexible programs, including more online options.
For-profit universities faced strict criticism from the Barack Obama administration, but U.S. Secretary of Education Betsy DeVos has sought to loosen regulations on them.
"Finally, we have an administration that is willing to look at these transactions on their merits, not based on ideological beliefs,” Gunderson said.
The Associated Press reported the U.S. Department of Education is considering ending an Obama-era program that offers total forgiveness of student loans for students who were defrauded by for-profit universities that did not meet gainful employment criteria.
“We are deeply concerned to see reports that the Department of Education may be considering a change in policy that would provide only partial loan relief for students who have been defrauded,” said Rory O’Sullivan, acting executive director of Young Invincibles, a nonprofit organization that advocates for economic justice for young people, in a statement.
A school is considered to have defrauded a student when that student has paid for a degree but the school has not met the three criteria for gainful employment — putting the school at risk for loss of Title IV funding and accreditation.
A school has not met these criteria if less than 35 percent of its student borrowers are able to pay back their loans, if the ratio of the typical graduate’s debt to income is over 12 percent or if the ratio of the typical graduate’s debt to their discretionary income is over 30 percent.
Graduates of the now defunct Charlotte School of Law in North Carolina are currently confronting this situation. The school lost its law certification last year, but students are still saddled with thousands of dollars of debt.
"These students often have few job prospects despite owing thousands in debt," Sullivan said. "Getting relief from their loans may be the only lifeline that allows them to get back on track."