Beware: Art School Students Are Preyed Upon by Big Banks

Somewhere, right now, someone is dreaming up a new way to milk more money out of prospective and current art college students.

It sounds sinister, but it’s true.

Banks and business people know there’s money to be made off the potential success of a person’s life goals and dreams... and if those dreams get fulfilled or not.

That’s how we’ve ended up with breath-freshening toothpaste, tooth-whitening candy, and fancy degrees from name-brand schools.

Dream Come True Turned Nightmare

Freddy Reynoso borrowed $160,000 dollars from Education Finance Partners, UBS. Had Freddy paid back his loan on schedule, it would have ended up costing him $279,000. And that’s just one of his student loans.

If you’re not familiar with Freddy’s story, he borrowed money to attend Berkley College of Music in Boston. Certainly if you’re going to attend a music college and become a working musician, Berkley would be the place to go. Sadly, Freddy died in a car accident after graduating and the loan companies are now after his father who co-signed the loans.

His father, an American citizen from Mexico, wanted to do whatever it took to help his son be the first in the family to get a college education. Now he’s dodging calls from collections agencies and wondering how he’s going to retire.

Little Fees, Big Business

Meanwhile at another college, rather than getting a refund check, students were given a Higher One bank card, which could be used like a credit or debit card. Higher One charges $20 for replacement cards, 50 cents for using your PIN instead of swiping as credit, and there’s a $19 fee for inactive accounts. In 2009, Higher One earned approximately $75 million in revenue and reported 57.8 million in the first quarter of 2012.

Universities nationwide signed on to the Higher One program, because the card reduced their administrative budgets. Meanwhile, student financial transactions were traceable, and demographic information became available to the credit card companies and universities.

Students often are not presented with hard numbers before borrowing money for school. Tuition prices rise every year. There are books, supplies, and fees that can’t be accounted for up front. Artists sign on the line and figure it will work itself out later. That often means dropping art after graduation, and working a job that you hate just to pay the bills.

How to Keep Loan Companies Away

If you want to be an artist that creates art that makes people think and feel, start feeling and thinking yourself. If you applied and got accepted to college, but you don’t have the money to go, use your clever artist ways to think outside the box. Figure out how to live as a creative artist / writer / actor / etc. without borrowing thousands of dollars for school.