Can't Even Trust A Socialist These Days. Bernie And Wife Under Investigation

[vorlon13]

231 students every year servicing the debt on $10,000,000 on top of supporting 61 staff ??

I don't know, vorlon.   What are the terms of the loan?  A 10M 30 year loan at 3.25% results in a cost of ~200 per student, per month (assuming 221 students).  What was the tuition again?  Any subsidies?

Related to overall operating costs (hello, payroll), that loan is going to be a small part of the overall expense.  I have no idea if their business plan works or not, having not looked at it, but if this is a private institution with endowments, and high tuition, I don't see that in and of itself being a huge issue.

How many students could service the debt on a $45,000 car loan on top of tuition?

Surely you recognize the difference between say a 5 year car loan and a real estate loan term that spans decades.  Surely you also recognize that no individual student is going to be responsible for $45K in debt.  You're comparing apples to oranges here.

Terms of $10,000,000 loan irrelevant as school wasn't financially viable before loan was even under consideration.

Unless students are required to sell their kidneys in Saudi Arabia . . . 


And with school apparently not financially viable before loan even considered, terms of loan would be highly unfavorable, worse than Broadway Payday Lender.

School did fail, and to me at least, not much of a surprise there.  Lending officer would have offered (or had a fiduciary responsibility to their employer to offer) a loan with interest rate commensurate with risk.  And this would have been an extraordinarily high risk loan.

I recall when Dana went under a few years ago, supposedly for an accreditation/debt issue, but when it was revealed they had ~ 600 students, it was pretty obvious (or should have been) that school was simply way too small to be viable today.  Overhead alone was killing them. Millions in debt, the accreditation issue was a coup de grace.