Taxpayers foot the bill for people who can't repay their mortgages Consumers foot the bill for people who file bankruptcy While this is true, it ignores the fact that the for-profits have open enrollment. I know one for-profit where a third to a half of new students can't read or do math at the 8th grade level. Any school with this caliber of students would struggle with defaults. Should we require proficiency tests before providing government backed loans and grants? Should we tell these people tough luck? This is the part that matters most to me as a taxpayer. My opinion is that students must pay for their first year's worth of college credits before they become eligible for any type of student loans or grants. This could be at the community college, CLEP exams or any college. Maybe set max loan amounts based on their field of study and ability to repay the loans. Banks and credit card companies set limits based on people's earnings potential. Why should the schools have to take any risk? If you sell your house to someone taking out a government backed mortgage, should you have to shoulder some of the risk if your buyer defaults?