Students’ pursuit of a college degree may include transferring from one school to another. Students typically transfer from a 2-year school to a 4- year school, a direction known as a vertical transfer. Students can also transfer from a 4-year school to a 2-year school, known as a reverse transfer, or laterally transfer between similar schools (e.g., 2-year to 2- year or 4-year to 4-year). Students can transfer for different reasons, depending on their goals and the type of transfer involved. For example, if a student is seeking to obtain a degree from a relatively expensive school, transferring credits from a less expensive school could help them save on tuition costs. Students may transfer vertically to facilitate completion of a bachelor’s degree. Alternatively, students may initiate a reverse transfer in order to complete an associate’s degree. Further, students who transfer laterally may do so to find a better institutional fit or a degree program that more closely aligns with their goals. Colleges also vary with respect to governance structure, length of degree programs, and other characteristics. Public schools are generally operated by publicly elected or appointed officials. Private schools are operated by individuals or agencies other than governmental entities. Further, private schools can be nonprofit or for-profit entities. Private nonprofit schools are traditionally operated by independent or religious organizations and earnings do not benefit any shareholder or individual, whereas private for-profit schools are owned and operated by private organizations and earnings can benefit shareholders or individuals. Schools are also classified by whether they offer degree programs that are 4 years or 2 years in duration. In this report, we refer to six school types: 2-year public, 2-year private nonprofit, 2-year private for-profit, 4- year public, 4-year private nonprofit, and 4-year private for-profit. A student who wants to transfer credits generally must provide the destination school with a transcript of previously earned credit. Destination schools generally have discretion in determining whether to accept these credits and use various criteria to evaluate them. Criteria can include, for example, a minimum grade requirement, the quality of the student’s coursework, the level and content of the coursework compared to similar courses at the destination school, and the applicability of a course to the degree or programs at the destination school. Many schools enter into voluntary transfer agreements or partnerships with each other—broadly referred to as articulation agreements—which specify how transferred course credits meet program or degree requirements among those schools. Additionally, states can establish statewide articulation agreements as well as credit transfer policies that are generally applicable to schools within the state. Our prior work found that states had enacted a variety of legislation and implemented statewide initiatives, primarily covering public schools, that established transfer agreements and common curricula to facilitate credit transfer. For example, in 2005, we reported that some states identified a block of general education courses for which credits were fully transferable across public schools within that state. We previously reported that, at that time, 39 states had legislation pertaining to transfer of credit between colleges. The Higher Education Opportunity Act requires schools participating in any program authorized under Title IV, which contains various student financial assistance programs, to publicly disclose their credit transfer policies. Specifically, the Act requires schools to publicly disclose, in a readable and comprehensible manner, a statement of their credit transfer policies that includes, at a minimum: (1) any established criteria the school uses regarding the transfer of credit earned at another school and (2) a list of schools with which the school has established an articulation agreement. The cost of attending college generally includes tuition, room and board, books and school supplies, fees, travel costs, and other miscellaneous expenses. As costs increase, college may become less affordable for many students and their families. To help students cover these costs, according to Education, in fiscal year 2016, $125 billion was available to students primarily through the Federal Pell Grant (Pell Grants) program and William D. Ford Federal Direct Loan program (Federal Direct Loans). Pell Grants, which do not have to be repaid, are awarded to undergraduate students based on financial need. Federal Direct Loans, either subsidized or unsubsidized by the government and which generally have to be repaid, are available up to the cost of attendance as determined by a student’s school and in accordance with federal limits. Pell Grants and Federal Direct Loans also have eligibility limits based on lifetime use or program length (see table 1). An estimated 35 percent of first-time students transferred schools over a 6-year period, according to Education’s most recent BPS data on students who started in academic year 2003-04 (2004 cohort). Transfer patterns are similar for the cohort of students in the ongoing BPS study who started in academic year 2011-12 (2012 cohort). In addition, the transfer rate among students who originally attended a private for-profit school was lower than among students who attended public or private nonprofit schools (see table 2). Of the students who transferred, an estimated 62 percent of them transferred between public schools. The most common transfer path was from a 2-year public to 4-year public school (see fig. 1). Transfer patterns for the 2012 cohort also show that students transferred between public schools at a higher rate than among other types of schools, based on mid-point data. Additionally, of the students who transferred, a majority (about 75 percent) originally attended a public school. Fewer transfer students originally attended a private nonprofit or private for-profit school, an estimated 19 and 7 percent, respectively. One Student’s Perspective One student wished that his school took greater care to ensure students know exactly which classes they should take to avoid losing credits and incurring additional costs as a result of transferring schools. He is worried that he might have to pay twice for classes he has already taken. Successful transfer of course credits can be hampered when the two schools involved have not established an agreement that specifies how credit transfers will occur. As we previously reported, many schools enter into transfer agreements or partnerships, often referred to as articulation agreements, which specify which course credits meet program or degree requirements at one or more schools (see app. II for an example of a transfer guide based on an articulation agreement). Based on our review of school websites, articulation agreements were more commonly listed among public schools, but private nonprofit and for-profit schools also establish articulation agreements. This level of clarity helps students better plan their college path by helping them understand how specific earned credits will transfer. Stakeholders we interviewed from 16 of 25 higher education organizations and schools said it is more difficult to transfer credits when there is no articulation agreement between schools or state policy outlining how credits will transfer. It is often easier for students to transfer credits when transferring to a school in the same state, especially in states that have policies outlining how credits should transfer, according to stakeholders we interviewed from 7 of 25 higher education organizations and schools. For example, according to the National Conference of State Legislatures, Florida has a statewide articulation agreement which generally guarantees that students who earn an associate’s degree from a Florida community college can transfer at least 60 credits to one of the 4-year public schools in the state. However, nearly one in five students who started at a 2-year public school and one in four who started at a 4-year public school transfer to a school in a different state, according to a recent National Student Clearinghouse report. One program designed to facilitate successful transfers for students across state lines is the Western Interstate Commission for Higher Education’s Interstate Passport program. According to its description, the program accomplishes this by focusing on common learning outcomes across schools in different states rather than determining how individual courses compare to each other. Specifically, faculty and others in the field, such as registrars and advisors, in schools across multiple states agreed upon student learning outcomes and proficiency criteria in different skill areas for general education courses intended to be completed during the first half of a bachelor’s degree program. Students who achieve these learning outcomes are then able to transfer their lower division general education credits to any of the other schools participating in the program. Currently there are 21 schools that are members of the Interstate Passport Network. The type of school is also a factor in successfully transferring credits between schools, according to stakeholders we interviewed from 18 of 25 higher education organizations and schools. For example, according to stakeholders, transferring credits from private for-profit schools can be more difficult than transferring credits from other types of schools. Private for-profit schools are typically nationally accredited whereas public and private nonprofit schools are historically regionally accredited, and we previously reported that regionally accredited schools usually prefer to accept credits only from other regionally accredited schools. Stakeholders from several higher education organizations and schools said national accreditation is seen as less stringent than regional accreditation, though Education recognizes and applies the same standards to both types of accreditors. Additionally, according to one stakeholder, nationally accredited schools tend to offer more technical or vocational degrees where the coursework may be difficult to transfer to other schools. According to our analysis of BPS data, a relatively small percentage of students who originally attended private for-profit schools transfer to another school (16 percent). Students transferring from a 2-year school, such as a community college, can face similar challenges transferring credits. For example, credits earned at 2-year schools may in some cases be seen by 4-year schools as less academically rigorous or more technical in nature than credits earned at the 4-year school, according to stakeholders we interviewed from 12 of 25 higher education organizations and schools. Students can also face challenges transferring credits between public and private schools. According to our prior work, statewide transfer policies generally applied only to public schools. Therefore, when transferring within the public school system, students potentially lose fewer credits compared to transferring between public and private schools. One Student’s Perspective One student said that he met with an advisor prior to transferring so that he could plan his coursework appropriately; however, he did not learn about some of the degree requirements until after he transferred. This resulted in taking an additional semester of classes to fulfill lower-level requirements. example, these stakeholders said that advisors should provide students with information to help them transition to the destination school and adjust to a new campus, in addition to helping them understand how their credits will transfer. Some schools may be under-resourced when it comes to providing quality advising to students, according to stakeholders we interviewed from 13 of 25 higher education organizations and schools. According to our analysis of BPS data, students most commonly transferred from public 2-year—such as community colleges—to public 4-year schools. Some of the stakeholders we spoke with specifically mentioned resource challenges faced by community colleges. One stakeholder at a community college said that it can be challenging for schools to identify which students intend to transfer in order to connect them with available advisors to help plan their path. According to stakeholders from one school, 4-year schools can also face resource challenges. Specifically, they identified multiple efforts to help transfer students, but said that their registrar and admissions staff do not have the capacity to meet with every student individually, and that students could go without advising as a result. Stakeholders from some of the higher education organizations and schools we interviewed said that the timing of advising and transfer information is also important. Specifically, they said that much of the transfer process is influenced by student decisions made early during their college career. For example, without early information about the transfer process, students may change majors or sign up for technical courses at their origin school without being aware of the implications such choices have on the transferability of their credits. Stakeholders also said that it is important for students to meet with advisors from both schools. Ultimately, the destination school generally has the final say on how credits are evaluated and accepted, so it is important for students to confirm with the destination school that the information they receive from their origin school is accurate, according to one stakeholder. The timing of when the destination school completes an official credit evaluation can also pose challenges for students, according to stakeholders from some higher education organizations and schools. Students may not know prior to enrollment at the destination school whether their credits will transfer because some schools do not complete an official credit evaluation until after the enrollment deadline. Even if a student’s credits transfer, they may not apply toward fulfilling degree requirements for their intended major, according to stakeholders we interviewed from 12 of 25 higher education organizations and schools. Some stakeholders saw this as a more important issue than the ability to transfer credits. Destination schools may determine that the courses the student wants to transfer are not equivalent to the requirements of the major at their school or may prefer their own curriculum, according to some stakeholders. For example, according to one stakeholder, a biology course may count as a general science elective but not count toward the science requirement for a degree in biology. In these cases, a student will likely have to take additional courses at the destination school, which could potentially delay graduation. One study that conducted student focus groups at two Indiana higher education systems similarly found that some students experienced challenges with credits applying toward degree requirements. Students lost an estimated 43 percent of college credits when they transferred, or an estimated 13 credits, on average, according to our analysis of BPS data on students who started in academic year 2003-04 and were tracked over a 6-year period. Typically, semester courses are awarded three credits each, so the average credits lost during transfer (13) is equivalent to about four courses, which is almost one semester of full-time enrollment for students taking 15 credits per semester. Credit loss among the 2004 cohort varied greatly by the types of schools involved in a transfer (see fig. 2). For example, students who transferred between public schools—which accounted for almost two-thirds of transfer students—lost 37 percent of their credits, on average. In comparison, students who transferred from private for-profit schools to public schools—which accounted for 4 percent of students who transferred—lost an estimated 94 percent of their credits, on average. (See table 3 in app. III for more information). Our analyses provide descriptive information on credit loss and do not control for certain factors that may be related to the ability to transfer credits, including whether students informed the school of possible credits eligible for transfer based on previous attendance at another school. Credit loss also varied by transfer direction. For example, based on our analysis of the 2004 cohort, students who transferred vertically from 2- year to 4-year schools lost an estimated average of 26 percent of their credits, while those who transferred laterally between 2-year schools lost an estimated average of 74 percent of their credits. Vertical transfers from 2-year to 4-year schools accounted for 40 percent of transfer students, whereas lateral transfers between 2-year schools accounted for 17 percent of transfer students (see table 4 in app. III for more information). While academic performance can be an important determinant in the transferability of credits, we did not assess how such factors affected the extent of credit loss. Our analysis also showed a wide range of credit loss when taking into account both the type of school and direction of transfer, or transfer path (see fig. 3). For example, students transferring from 2-year public to 4- year public schools, which was the most common transfer path and accounted for 26 percent of transfer students, lost an estimated average of 22 percent of their credits. This was a lower rate of credit loss than the overall average for all transfer students. In addition, students transferring between 2-year public schools—another common transfer path that accounted for 13 percent of transfer students—lost an estimated average of 69 percent of their credits. Students who took some of the less frequent transfer paths lost a relatively higher percentage of their credits. For example, students who transferred from 2-year private for-profit to 2-year public schools lost an estimated average of 97 percent of their credits. Similarly, students who transferred from 2-year public to 2-year private for-profit schools lost an estimated average of 95 percent of their credits. Each of these transfer paths accounted for about 1 percent of transfer students. (See table 5 in app. III for more information). Stakeholders from about half of the higher education organizations and schools we interviewed said some students may seek to save on tuition costs by starting at a less expensive school and then transferring to a more expensive school to complete a degree. However, stakeholders from about the same number of higher education organizations and schools told us that some students face additional tuition costs due to repeated coursework or additional time to degree as a result of lost credits. See figure 4 for examples of the transfer process and its potential outcomes. If a student is seeking to obtain a bachelor’s degree from a relatively expensive school, transferring could help the student save on tuition costs. Specifically, if a student is able to successfully transfer all credits from the less expensive school, and those credits count toward his or her degree program, then the student saves on tuition costs by having earned a portion of the credits at the lower-cost origin school. If a student loses some credits during the transfer, then the student’s overall tuition costs depend on the combined effect of the credit loss and the difference in tuition rates between the two schools. However, with any level of credit loss, the student will likely need to stay in school longer to complete degree requirements and pay tuition for repeated coursework. If a student loses all of his or her transfer credits, then the cost of completing a degree is generally higher because the student not only incurs tuition costs from the origin school but must also retake credits required for a degree at the more expensive destination school. This also extends the time to complete a degree. The direction of transfer also affects college affordability. Stakeholders we interviewed from 12 of 25 higher education organizations and schools said that students transferring vertically may achieve savings because 2- year schools are relatively low cost. Based on our analysis of 2013-2014 IPEDS tuition data, average net tuition per year—which is the cost of attendance minus financial aid and non-tuition costs, such as room and board—varied by school type and ranges from about $1,900 for a 2-year public school to about $13,800 for a 4-year private nonprofit school (see table 6 in app. III for more tuition data). However, net tuition may underestimate costs for transfer students because, according to Education, schools often do not offer the same amount of institutional aid to transfer students compared to first-time, non-transfer students. Transfer may be more difficult when transferring laterally. In comparison to vertical transfers, students who transferred laterally experienced higher rates of credit loss, according to our analysis of BPS data for the 2004 cohort. Stakeholders we spoke with from one school said that students who are transferring between 4-year schools may not have been planning to transfer, and it is more difficult to advise students about which credits will transfer laterally. One stakeholder from another school said that if students transferring laterally switch their degree program, few of their courses will transfer. Students who lose more credits during transfer would typically incur additional tuition costs by paying for repeated or additional coursework. To illustrate some potential financial implications for students, we created examples of several different transfer scenarios (see fig. 5 and fig. 10 in app. III). Credit loss data do not reflect the reasons why credits were not accepted, though there are a variety of reasons why credits may not transfer successfully. In some cases, the credits students attempt to transfer may not be applicable or comparable to the coursework at the destination school. For example, vocational or remedial coursework from a 2-year school may not be transferable to a 4-year degree program. Further, factors that are not entirely within a school’s control, such as students’ decisions and academic performance, also affect credit transfer and the time it takes to complete a degree. For example, students may not ask to have their credits evaluated or they may decide to change majors. Our analysis does not reflect certain student decisions or characteristics, which can also factor into the extent of credit loss. Further, aside from tuition, other factors can affect a student’s costs, such as changes in cost of living or forgone earnings while attending school, according to stakeholders from several higher education organizations and schools. Almost half of transfer students received Pell Grants and almost two- thirds received Federal Direct Loans, according to our analysis of BPS data collected between 2004 and 2009. According to mid-point data from the more recent BPS cohort, many transfer students who started school in academic year 2011-12 also received Pell Grants (55 percent) and Federal Direct Loans (62 percent) in their first 3 years. Access to such aid is affected by the length of time needed to complete a degree. The Pell Grant program imposes a lifetime limit of 12 semesters (6 years) of eligibility. Direct Subsidized Loans, which are loans in which the government pays part of the interest, are limited to a maximum timeframe of 150 percent of the published length of a program at a school (e.g., 150 percent of a 120-credit, 4-year degree program would be 6 years). According to our analysis of both BPS cohorts during their first 3 years in school, an estimated 48 percent of students in the 2004 cohort received Direct Subsidized Loans and an estimated 57 percent of students in the 2012 cohort received Direct Subsidized Loans. According to stakeholders we interviewed from higher education organizations and schools, transfer students may exhaust available aid before they complete their degree. Transfer students who lose credits must pay for and spend additional time to retake credits needed to graduate, which may make them exceed time frames for financial aid eligibility. BPS data do not indicate whether students exhausted their financial aid eligibility before obtaining a degree. However, many transfer students who started college in academic year 2003-04, an estimated 40 percent, did not obtain any type of degree within a 6-year time period. Further, while available data do not provide enough information to adequately identify a student’s intention to obtain a specific type of degree (e.g., 2-year associate’s degree versus 4-year bachelor’s degree), about a third of students who chose to transfer from a 2-year to a 4-year school did not ultimately obtain a bachelor’s or other type of degree within the 6-year time period (see table 7 in app. III for more information). In cases where students lose access to aid, they may be financially unprepared or unable to earn their degree. Additionally, stakeholders from some higher education organizations and schools told us that schools may not offer as much scholarship funding for transfer students as they do for new, first-time students. Credits lost in a transfer also can result in additional costs for the federal government in providing student aid. The government’s costs may increase if transfer students who receive financial aid take longer to complete a degree as a result of retaking lost credits. Education’s data do not identify whether particular funding sources, such as Pell Grants or other financial aid, are used to pay for credits taken or to pay for other costs. Therefore, we used an example to show how lost credits can result in potential additional costs in student aid to the federal government (see fig. 6). Actual costs to the federal government would vary. Some students may transfer as a result of the closure of their current school, and they face additional challenges and financial aid considerations. In recent years, multiple school closures have affected large numbers of students and resulted in costs to the federal government. School closures pose financial risks to students who wish to continue their education because of the potential difficulty in transferring credits from a closed school. When a school closes, students must decide whether to complete their degree at another school—which can include transferring credits—or stop pursuit of that degree and, according to Education policy, apply for a discharge of their federal student loans. Education policy states that students are eligible to discharge (i.e., not pay) 100 percent of their federal student loans if they (a) did not complete their program because of a closure, and (b) did not continue in a comparable program at another school. Education officials said some students who have requested discharges of their student loans after their private for-profit school closed said they were unable to transfer their credits. For students who transfer to a comparable program at another school, their existing Direct Subsidized Loans continue to count in calculating eligibility (150 percent of published program length). Students with Pell Grants who are unable to complete their program at the closed school can restore the portion of their lifetime eligibility for grants used at the closed school, according to a December 2016 Education announcement. Closures can pose a financial risk for the government and taxpayers to the extent that federal student loans are forgiven and students reset their Pell Grant eligibility. Under federal law, schools participating in any Title IV program are required to publicly disclose the transfer of credit policies established by the school, including a list of schools with which they have articulation agreements. According to Education officials, schools must disclose credit transfer policies on their website, but the list of schools can be disclosed through a website or other appropriate publications or mailings. Based on our review of websites for a nationally representative stratified random sample of 214 schools, an estimated 99 percent contained the school’s credit transfer policies. Of those websites with credit transfer information, an estimated 68 percent listed the names of partner schools with which they have articulation agreements. An estimated 29 percent of websites did not provide such a list, while an estimated 4 percent explicitly stated that the school did not have any articulation agreements. In addition, the prevalence of websites listing partner schools varied by school type. While most (89 percent) public school websites with credit transfer information listed partner schools with which they have articulation agreements, fewer private nonprofit and for-profit school websites had such a list (see fig. 7). In some cases, school websites included information on statewide articulation policies, such as the Illinois Articulation Initiative, where, according to its website, over 100 participating schools in the state have agreed to accept a package of general education courses in lieu of their own general education classes. Students have access to varying levels of detail about credits covered by articulation agreements. Of the websites that listed partner schools, an estimated 63 percent provided the agreement’s provisions, and an estimated 21 percent provided a link to partner school websites. For the schools that did not provide a list of partner schools on their website or explicitly note that they had no such agreements, it was difficult to determine, without further follow-up, whether the lack of information indicated that the school did not have such agreements or that the school was not providing the list of partner schools. Based on targeted follow-up with officials at 10 schools, we found that some did not have articulation agreements while others had articulation agreements but their partner schools were not listed on the website. Specifically, officials at 5 of the schools said that their school did not have, or they were unaware of, established articulation agreements. Officials at 3 schools said that they had articulation agreements and they were listed in publications available onsite at the school or by contacting school staff. (We did not verify the physical presence of publication copies at school locations or the information included). Officials at 2 schools said that they were currently reviewing articulation agreements and planning to update the school website. Although schools participating in any Title IV program are required to publicly disclose a list of the schools with which they have articulation agreements, they do not have to disclose this information specifically on their websites but may choose to do so in another appropriate publication or mailing. In addition, Education officials stated that it is unclear whether the department has the authority to require schools to post the list of articulation-agreement schools online because federal law does not specify the means of disclosure. The purpose of this disclosure requirement is for schools to share transfer information with students, and selecting an appropriate means of disseminating this information enhances the effectiveness of such communication. Furthermore, Education officials told us that schools are increasingly using websites to share consumer information and that the department already requires that credit transfer policies and other disclosures, such as net price calculators, be posted on school websites. Awareness of articulation agreements can benefit students because such agreements clarify how credits transfer between schools. Posting this information online would make it more easily accessible to prospective students and their families than restricting it to publications located on campus, particularly since almost all school websites already include information on credit transfer policies. In circumstances where the school does not have articulation agreements with other schools, Education’s guidance does not specify how or whether to document this. According to Education officials, federal law and related regulations do not require schools to disclose the fact that they do not have articulation agreements, and the officials stated that it is unclear whether the department has the authority to require such a disclosure. Online information on the presence of articulation agreements would make it easier to determine whether schools are disclosing a list of partner schools as required. Clarification on what a school should depict on its website when it does not have articulation agreements could also help provide more information to students and enhance their understanding of potential transfer options. Moreover, one of Education’s goals is to increase college completion and affordability, and adequate communication with transferring students supports this goal. More complete information on school websites about articulation agreements on transfers could help students fully weigh alternatives when making a transfer decision. Aside from the required school transfer policies noted earlier, school websites varied in the extent of any additional information they provided on transfers. An estimated 60 percent of school websites had some general information about how students could initiate the process of having their course credits evaluated for transfer (see fig. 8). In addition, about half of school websites included resources to help students understand the transfer process. These resources were more common on websites for public schools than for other school types. Some websites, for example, had course equivalency databases where students could input their prior coursework to see how it would translate into earned credits at the destination school. In addition, some school websites provided information on transfer-related resources, such as transfer fairs and other in-person activities at which students could meet with school representatives to learn more about the transfer process. An estimated 47 percent of school websites published transfer deadlines and 43 percent published transfer-specific financial aid information. Knowing deadlines in advance can help students ensure that they do not miss key steps of the transfer process, such as submitting admissions or credit evaluation applications. Financial aid information, including whether a school awards transfer scholarships, can help students identify transfer options that are financially feasible. Fewer schools provided listings of transfer-related frequently asked questions or transfer-specific contacts. Such information can help students more easily navigate to applicable transfer information if they have questions and identify relevant school staff for assistance. The format of transfer information also varied on school websites. Three- quarters of school websites used multiple formats to convey transfer information, including various combinations of webpages or websites (including external sites) and downloadable documents, such as copies of course catalogs. In comparison, an estimated 25 percent provided credit transfer information in a single format, either through a single webpage or document. Nevertheless, it may still be difficult to access transfer information, even if it is provided in a single format, if the transfer material is not easy to locate on the school’s website. For example, we found one school’s credit transfer policies in a course catalog that we downloaded from the website. However, the school website’s search function did not show the location of this material and it was not obvious that a student would need to download the course catalog to access transfer information. In other instances, schools listed credit transfer policies on their consumer information disclosure webpages, but if a student is unaware that consumer disclosures include credit transfer policies, they may not know to look on that particular page for transfer information. In addition to school websites, Education’s websites also provide college students and their families with information on transfers, but it is limited. We found that the transfer information was neither focused nor targeted toward transfer students. In particular, Education’s StudentAid.gov website highlights descriptions of school types and things to consider when choosing a school, and while these pages briefly refer to transfer information, it is presented in the context of other topics rather than having a substantive focus on transfer. For example, as part of a broad description of community colleges, it is noted that many community colleges have articulation agreements and students from this type of school often transfer. Education officials said that they do not see a need to develop consumer information on transfers because students typically would not seek transfer information from Education, and they see little demand based on the volume of transfer-related searches of the department’s website. However, even for students who seek transfer information, it would be difficult for them to access relevant information given Education’s limited offerings on the topic. Providing additional transfer-focused information could encourage more students to access the department’s website for this purpose. Education also includes some transfer information for students affected by school closures in a frequently-asked-questions page on Education’s website. While this information is helpful, it does not address the broader population of transfer students, which accounted for over a third of first-time students, according to our analysis of transfer data. Finally, according to student complaint data, Education officials sometimes provided general information on the transferability of credits in response to complaints about transfer issues. Although such information could broadly apply to all transfer students, it is provided infrequently and is limited to students who happen to submit a complaint. Other reasons Education officials cited for not developing consumer information on transfers are that resources for transfer students are mostly provided by schools, transfer is school specific, and the federal government does not oversee schools’ curriculums. However, we found that close to half of school websites are not providing transfer resources that can help students understand the process beyond the minimal required information. This could compound the challenges we noted earlier of students potentially not obtaining adequate advising and information. In addition, while transferring is ultimately based on a student’s unique circumstances coupled with a school’s transfer policy, there are nevertheless general considerations that apply across schools. Education already provides consumer guidance, such as on college applications, which applies across schools. Similarly, Education could provide guidance on college transfers, such as common credit evaluation criteria, tips for locating transfer resources, and the potential effect of transferring on financial aid eligibility. Furthermore, while Education does not oversee schools’ curriculums, it oversees federal financial aid programs that provide over $125 billion to students. The department also has a goal of promoting college affordability. Given the substantial number of students who transfer and the effect of credit loss on potential costs to the student and the federal government, general consumer information on factors to consider when transferring could be valuable. According to federal internal control standards, agencies should externally communicate the necessary quality information to help achieve their goals. Transfers can affect the time and cost of completing a degree. Knowledge of key considerations could help students and their families make better-informed transfer decisions. About one-third of students transferred schools on their path toward a college degree based on our analysis of Education’s data. While for some, transfer can provide an avenue for saving on tuition costs, many of the credits that students earn may not ultimately help them earn a degree after they transfer. As tuition rises and college becomes less affordable for many, the financial implications of losing credits during transfer are particularly salient for students, their families, and the federal government. Articulation agreements between schools can facilitate credit transfers because they detail how and which credits will transfer from one school to another. When schools make information about these agreements accessible on their websites, students can more easily understand their transfer options. In addition, since many school websites do not provide helpful transfer resources for students, consumer guidance from Education that includes key factors to consider when transferring could help students more easily navigate the process. With such guidance, students can more accurately weigh their options and make an informed decision about transferring schools that takes into account how much time and money they must invest in pursuit of a college degree. To help improve students’ access to information so that they can make well-informed transfer decisions, we recommend the Secretary of Education take the following two actions: Require schools to (1) disclose the list of schools with which they have articulation agreements online if the school has a website, and (2) clearly inform students, on the school’s website if it has one, when no articulation agreements on credit transfer are in place. If the department determines that it does not have the authority to require this, it should nonetheless encourage schools to take these actions (through guidance or other means). Provide students and their families with general transfer information, for example by developing a consumer guide and posting it on Education’s website or augmenting transfer information already provided on the website, to help increase awareness of key considerations when transferring schools. We provided a draft of this report to Education for its review and comment. Education’s comments are reproduced in appendix IV. In its written comments, Education disagreed with our recommendation to require schools to disclose on their websites the list of partner schools with which they have articulation agreements and inform students when there are no agreements in place. Education reiterated that it already requires schools to disclose a list of other schools with which they have established articulation agreements. Given that the purpose of required consumer disclosures on articulation agreements is to inform students, we believe that posting this information online would make it more accessible to prospective students compared to publications located physically on a school’s campus. The increased accessibility would be especially beneficial for prospective students who live far away from the school. Education also said that students should contact specific schools to obtain accurate and updated information. While it is important for students to contact schools, we found that not all schools listed transfer- specific contacts on their websites. Therefore, it is particularly important that the required consumer information on articulation agreements be easily accessible to students. Moreover, according to Education, online disclosure is already required with respect to a school’s credit transfer policies if the school has a website, and schools are increasingly using their websites to provide other consumer information to students. Education also cautioned that placing special emphasis on articulation agreements could mislead students because the agreements—or lack thereof—do not fully reflect the transferability of credits. Specifically, Education said that if the few schools with articulation agreements are listed on the school’s website or if a school notes that it has no articulation agreements, students may erroneously believe that their credits will transfer only to those few schools or that none of their credits will transfer. However, regardless of the number of articulation agreements a school may have, schools are already legally required to disclose the list of partner schools. We found that a majority of schools already disclose a list of partner schools on their websites, and it is unclear why posting this required information online would be more confusing than disclosing this information through publications or other means. Further, according to Education, schools are also legally required to disclose their credit transfer policies online, in effect, outlining the circumstances under which students can generally transfer credits. Therefore, using a school’s website to disclose the list of other schools with which there are articulation agreements, or the fact that there are no agreements, would enhance students’ understanding of their transfer options and help reduce confusion rather than mislead students. Education agreed that it would assist students to have more general transfer information when students are considering transferring to other schools, and said that it plans to include this information on its studentaid.gov website. Education also provided technical comments, which we incorporated in our report as appropriate. In its technical comments, Education proposed that we address the relevance of academic performance to the transferability of credits. We agree that this is an important factor that can affect credit loss and provided additional clarification and references to Education’s research on this topic. As agreed with your offices, unless you publicly announce the contents of this report earlier, we plan no further distribution until 30 days from the report date. At that time, we will send copies to the appropriate congressional committees, the Secretary of the Department of Education, and other interested parties. In addition, the report will be available at no charge on the GAO website at http://www.gao.gov. If you or your staff have any questions about this report, please contact me at (617) 788- 0534 or emreyarrasm@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this report. GAO staff who made key contributions to this report are listed in appendix V. This report examines: (1) How many college students transfer and what challenges, if any, do they face in transferring credits? (2) What are possible financial implications associated with transferring credits? and (3) To what extent are students provided with information about transfer policies to help them plan their college path? To address these questions, we interviewed stakeholders from 25 higher education organizations and schools, analyzed transfer and tuition data from Education’s Beginning Postsecondary Students Longitudinal Study (BPS) and Integrated Postsecondary Education Data System (IPEDS), and reviewed websites for a nationally-representative stratified random sample of schools. We assessed the reliability of BPS and IPEDS data by reviewing existing information about the data and the system that produced them and interviewing officials knowledgeable about the data. We determined that the data were sufficiently reliable for the purposes of describing transfer students and credit loss rates. We also reviewed Education’s guidance and regulations on credit transfer disclosure requirements and consumer information for college students, and we compared Education’s practices to federal internal control standards. Finally, we reviewed relevant literature, federal laws, and interviewed Education officials. This appendix provides a detailed description of the methodology used to (1) gather testimonial evidence through interviews, (2) analyze Education’s transfer and tuition data, and (3) conduct website reviews. We conducted this performance audit from March 2016 to August 2017 in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives. To understand what challenges, if any, students face in transferring credits, we interviewed stakeholders from a non-generalizable sample of 25 higher education organizations and schools. More specifically, we interviewed representatives from 17 higher education organizations and officials from eight schools that have expertise in transfers and represent a range of viewpoints. We selected higher education organizations that met one or more of the following criteria: (1) published relevant research or other work, (2) developed guidelines for credit transfer processes, (3) developed tools or state policies to help facilitate credit transfers, or (4) represented relevant groups involved in the transfer process such as associations for students, admissions or advising staff, school systems, accrediting agencies, and/or state or regional higher education bodies. Further, we interviewed stakeholders from eight selected schools to obtain additional perspectives from those directly involved in the credit transfer process. At each school, we interviewed stakeholders involved in the credit evaluation process, such as admissions/advising staff, registrar officials, and relevant transfer offices, as appropriate. To ensure we obtained perspectives from different school types, we selected a mix of public, private nonprofit, and private for-profit schools, and 2- and 4-year schools. While we selected a diverse range of schools, we did not equally select schools among each school type since some school types have a low prevalence or are not typically part of a transfer path. For example, we did not interview stakeholders from a 2-year private nonprofit school because this school type represents a small segment of schools and, correspondingly, a small number of students who transfer to or from that type of school. In our selection, we included at least one pair of schools with articulation agreements. We chose schools in different geographic locations and that represent different transfer environments. For example, we identified schools in states with a variety of statewide transfer policies and student transfer rates. We used state transfer rate data from the National Student Clearinghouse Research Center to inform our selection of schools to conduct interviews. We interviewed National Student Clearinghouse Research Center officials and reviewed the methodology to determine if there are any limitations associated with using the total state transfer rate, and determined these data to be reliable for our purposes. For these interviews with stakeholders from 25 higher education organizations and schools (stakeholders), we used semi-structured interview protocols. To summarize results, we identified commonly mentioned themes regarding challenges in the transfer process. We used the following terms to summarize themes mentioned by stakeholders: “some” or “a few” higher education organizations and schools represent 3 to 5; “several” represents 6 to 10; and “many” represents 11 to 15. For themes mentioned by stakeholders from more than 15 higher education organizations and schools, we generally specified the number of groups in the text. We corroborated testimonial evidence on transfer challenges with findings from our analysis of Education’s transfer data and documentary evidence from transfer literature or publications. In addition to the interviews with 25 higher education organizations and schools, we collected first-hand accounts from several individual transfer students identified by stakeholders from higher education organizations. The students provided non-generalizable illustrative examples of experiences with the transfer process. BPS: To estimate the extent to which students’ credits transfer the first time they change schools and to identify other characteristics of transfer students, we analyzed transfer data from Education’s Beginning Postsecondary Students Longitudinal Study (BPS). To estimate the extent of credit loss among students, we analyzed transcript data from the 2004 cohort, the most recently completed. Each cycle of BPS follows a cohort of students enrolling in postsecondary education for the first time. BPS tracks these students over a 6-year period and collects both survey and transcript data. The most recently completed BPS cohort first enrolled in postsecondary education in the 2003-04 academic year. The final follow-up with this cohort group was the 2008-09 academic year. For the purposes of our data analysis, we define transfer students as those who moved from one school to another for a period longer than 4 months, and the analyses reflect a student’s first transfer only. We define credit loss as credits earned at the origin school that were not accepted by the destination school. The sector variable was used to categorize schools according to whether they were public, private nonprofit, or private for- profit schools at the 2-year or 4-year level. The sector variable reflects the level of the highest degree offered at the school. The highest degree offered may be different from the predominant degree obtained at the school. To incorporate more recent data into the analysis and to further understand the potential implications for federal financial aid, we also used BPS mid-point data from the cohort of students who began school in academic year 2011-12—the 2012 cohort—to describe the number of transfers and the financial aid characteristics of more recent transfer students. This will only represent data collected midway through the study period, and transfer characteristics will change over the remainder of the study period as students continue to progress through their undergraduate studies and the 6-year time period. While we used transcript data to estimate transfer data for the full 6-year study period of the 2004 cohort, transcript data are not yet available for the 2012 cohort. As a result, to calculate mid-point transfer and financial aid receipt rates in the first 3 years of the study, we used BPS data based on transfers reported in student interviews. Estimates based on transcript data may differ from estimates based on student interview data because interviews represent one point in time, whereas transcript data cover an entire study period. To better understand any potential implications for federal financial aid, we determined the extent to which transfer students received federal financial aid, including Pell Grants and Federal Direct Loans. Federal financial aid is awarded based on a student’s total costs, which can include non-tuition expenses. Available data do not identify whether the cost of credits are covered by Pell Grant, Federal Direct Loans, or other financial aid funds specifically. Because the BPS data are based on probability samples, estimates are calculated using the appropriate sample weights provided and reflecting the sample design. Each of these samples follows a probability procedure based on random selection, and they represent only one of a large number of samples that could have been drawn. Since each sample could have provided different estimates, we express our confidence in the precision of our particular sample’s results as a 95 percent confidence interval. This is the interval that would contain the actual population value for 95 percent of the samples we could have drawn. Unless otherwise noted, all percentage estimates from the BPS data analysis have 95 percent confidence intervals within +/-10 percentage points of the percent estimate, and other numerical estimates have confidence intervals within +/-10 percent of the estimate itself. We compared 95 percent confidence intervals to identify statistically significant differences between specific estimates and the comparison groups. While the BPS data illustrate the extent to which credits transfer, the data do not track the reason why credits did not transfer or the academic quality of those credits. The data also do not distinguish whether credits accepted counted toward degree requirements for a student’s major. This means that credit acceptance cannot be equated with progress toward a degree, which would also have financial implications for students. Additionally, student decisions may also affect credit transfer and the time it takes to complete a degree. For example, students may not ask to have their credits evaluated or they may decide to change majors, which would make it difficult to attribute the costs of lost credits to the transfer process. Given these limitations, the potential financial effects associated with lost credits are not solely attributable to schools’ credit transfer policies. Similarly, differences in financial outcomes for transfer versus non- transfer students may be due to multiple reasons and not just the credit transfer process. IPEDS: To provide information on tuition by school type (i.e., public, private for-profit, and private nonprofit) and level of degree program (i.e., 2-year, 4-year), we calculated average net tuition by analyzing the tuition and non-tuition portions of the 2013-2014 academic year cost of attendance obtained from the institutional characteristics component of the Integrated Postsecondary Education Data System (IPEDS). We chose the 2013-2014 period because it contained the most recent net price data available at the time of our analysis. IPEDS gathers data from every college, university, and technical and vocational institution that participates in federal student aid programs, so the data cover the population of interest for this study. Net tuition is the cost of attendance minus financial aid and non-tuition portions of attendance. To estimate net tuition, we started with the net price variable, which is equal to the cost of attendance (i.e., tuition, fees, room and board, books and other expenses) minus financial aid. We then used other IPEDS variables to calculate the non-tuition portion of the cost of attendance and subtracted that value from the net price to estimate net tuition. We used net tuition data instead of published tuition because it is a more realistic portrayal of what students might actually pay. IPEDS net price data is collected at the school-level based on average charges for first-time, full-time undergraduate students, and does not account for variation in the tuition charged to individual students at the same school. In addition, many schools charge tuition by program or have different fees based on the specific major, which is not accounted for in the per-credit net tuition average estimates. Further, net tuition may underestimate costs for transfer students because, according to Education, schools often do not offer the same amount of institutional aid to transfer students compared to first-time, non-transfer students. Transfer Scenarios: To describe possible financial implications for students and the federal government associated with transferring credits, we present a variety of example transfer path scenarios. To create scenarios illustrating financial implications for students, we selected the transfer paths that were among the most common paths based on our transfer frequency analysis of each school control type (public, private nonprofit, and private for-profit). These transfer scenarios vary in the number of credits lost during transfer, type of transfer, type of school, and average net tuition. To create a scenario to illustrate the financial implications of transfer for the government, we assume the student received the average per credit Pell Grant receipt based on BPS data. For both types of transfer scenarios (showing possible financial implications for students and the government), we base credit loss assumptions on 2004-2009 BPS transcript data. The assumption for the number of credits lost is informed by the average percentage of credits lost for the relevant transfer path. We base tuition assumptions on 2013- 2014 IPEDS data on tuition by school type, and tuition values are from the 2013-2014 academic year. Because these scenarios are used for illustrative purposes and we are not estimating tuition costs of a particular cohort of students, we chose assumptions that were reflective of the higher education environment using the best available data. Accordingly, we used the most recently available data from BPS and IPEDS, though the time periods do not match because the datasets have different collection periods. We calculated the financial implications for students in the transfer scenarios by comparing the potential tuition for completing a degree at the origin and destination schools for a transfer student to the potential tuition for completing the same (120) credits for a degree at the destination school. We made various assumptions for these calculations. The scenarios assume that all students would pay tuition on a per-credit basis to retake credits lost during transfer, and that students attending public schools would pay in-state tuition. The financial implications of transfer would be impacted by whether a student attending a public school pays in-state or out-of-state tuition. We also assume that credits that are transferred will count toward graduation requirements. However, it is important to note that schools can accept transfer credits as elective credit but not allow the credit to be used toward a specific degree program. The calculations for the financial implications for students do not account for how students may use financial aid to offset out-of-pocket tuition costs, so the identified costs may not all be borne by the students. The calculations also do not account for the opportunity cost of staying in school longer, in the form of lost wages, or other factors that may affect a student’s decision to transfer, such as differences in room and board, expected lifetime earnings, quality of life, etc. Lastly, we apply average credit loss rates for the purposes of these scenarios. It is important to note that schools may have legitimate reasons to not accept some transfer credits, such as insufficient quality of prior instruction or lack of applicability to the chosen program of study, among other reasons. To determine the extent to which schools provide students with information on transfers to help them plan their college path, we reviewed websites from a nationally-representative sample of 214 schools participating in federal student aid programs. The sample was stratified and randomly drawn from Education’s 2014-2015 IPEDS, which contains data for all schools that participate in federal student aid programs authorized under Title IV of the Higher Education Act of 1965, as amended. Our sampling frame consisted of all public, private nonprofit, and private for-profit 2-year and 4-year degree granting schools that participated in Title IV federal student aid programs, had undergraduate programs, were not U.S. military academies, and had at least 100 students, yielding a universe of 4,309 schools. We dropped schools from our sample that were no longer operational at the time of our review. During our review period, several schools selected for our sample closed. To ensure that we had an adequate sample size for each school type, we drew an additional sample of schools from IPEDS that excluded the schools from our original sample and the closed schools. We created six strata to stratify the sampling frame by school type (public, private nonprofit, and private for-profit) and level of degree program (2-year and 4-year). This sample of schools allowed us to make national estimates about the availability of transfer information, as well as estimates by school type. The percentage estimates for website review results for the overall population reported from this review have 95 percent confidence intervals of +/- 7 percentage points unless otherwise noted. In order to review comparable information across the sampled schools, we developed a standardized web-based data collection instrument that we used to examine on each website the availability of credit transfer policies, articulation agreement lists, and other transfer information, such as contacts and tools to help transfer students, frequently asked questions, and deadlines for submitting information. We used a combination of information from our interviews, transfer literature, and relevant federal laws, regulations, and website usability guidelines to develop the questions included in the data collection instrument. We reviewed websites from September 2016 through February 2017. One analyst recorded information in the data collection instrument. The information was then checked and verified by another analyst. We collected complete information for all 214 schools in our sample. We then analyzed the information across schools. We did not, as a part of our review of school websites, assess the schools for compliance with legal disclosure requirements. Instead, this review was intended to understand what information is made accessible to students. Based on the results of our website review, we conducted targeted follow- up with school officials to obtain additional information related to course credit transfer disclosures. We followed up with two groups of schools. For the first group, we prioritized schools whose websites we initially determined did not include credit transfer policies or criteria for evaluating transfer credits. We contacted all schools in this group and asked school officials about how they provided students with information on credit transfer policies. For the second group, we contacted a select group of schools that did not list partner schools online. We selected schools in the second group based on whether they were already selected for follow-up in our first group as well as on their representation of different school types. The following figure depicts information that a school provided on its website and illustrates how the school implemented its articulation agreement. In this example, a destination school created transfer guides specific to origin schools with which it established an articulation agreement. These guides show how courses from the origin school would transfer into one of the destination school’s degree programs. The format of information provided about articulation agreements and the specifics of their provisions vary from school to school. This appendix provides estimates of the percentage of credits lost by school type, transfer direction, and transfer path; average net tuition by school type; the percentage of transfer students who did not obtain a degree; and two additional transfer scenario examples that illustrate transfer paths that include private for-profit schools. The transfer scenarios in the following figure illustrate possible financial implications of additional transfer paths for students. More specifically, these transfer scenarios illustrate potential financial implications for two transfer paths that are among the most common and involve private for- profit schools, based on our BPS analysis. Nonetheless, each of these transfer paths accounted for 2 percent or less of transfer students. In the transfer from 2-year public to 4-year private for-profit school example, the student accrues savings compared to attending the destination 4-year private for-profit school for the entire degree program because the student is able to transfer almost half the 60 credits earned at the less expensive 2-year public school. Net tuition at the 4-year private for-profit school is approximately seven times more expensive than at the 2-year public school. In the transfer from 2-year private for-profit to 2-year public school example, the student incurs additional costs compared to attending the destination 2-year public school for the entire degree program because the student has to repeat almost all of the 30 credits earned at the 2-year private for-profit school. This transfer path has a high credit loss rate. In addition, the credits the student lost from the 2-year private for-profit school were relatively expensive compared to the cost of credits at the destination 2-year public school. In addition to the contact named above, Meeta Engle (Assistant Director); Amrita Sen (Analyst-in-Charge); Elizabeth Hartjes, Connor Kincaid, Jean McSween, John Mingus, and Dae Park made key contributions to this report. Also contributing to this report were Susan Aschoff, James Bennett, Deborah Bland, Alicia Cackley, Evelyn Calderon, Yue Pui Chin, Michelle Duren, Gustavo Fernandez, Alexander Galuten, Timothy Guinane, Sharon Hermes, Laura Hoffrey, Bill Keller, Sheila McCoy, Jennifer McDonald, Jeffrey Miller, Amy Moran Lowe, Alexandra Rouse, Katherine Siggerud, Alexandra Squitieri, and Christopher Zbrozek.

Summary: College students sometimes opt to transfer schools in response to changing interests or for financial reasons. The extent to which students can transfer previously earned course credits can affect the time and cost for completing a degree. Given the federal government's sizeable investment in student aid—$125 billion in fiscal year 2016—and potential difficulties students may face in transferring credits, GAO was asked to examine the college transfer process. GAO examined (1) transfer rates and challenges students face in transferring credits, (2) the possible financial implications of transfer, and (3) the extent to which students are provided with transfer information to help them plan their college path. GAO analyzed Education's data, including its most recent available transfer data from the 2004-2009 student cohort, interviewed a non-generalizable sample of stakeholders from 25 schools and higher education organizations, and reviewed a nationally-representative sample of 214 school websites. Based on GAO's analysis of the Department of Education's (Education) most recently available data, an estimated 35 percent of college students transferred to a new school at least once from 2004 to 2009, and GAO found that students may face challenges getting information or advice about transferring course credits. An estimated 62 percent of these transfers were between public schools. According to stakeholders GAO spoke with, students can face challenges transferring credits between schools that do not have statewide polices or articulation agreements, which are transfer agreements or partnerships between schools designating how credits earned at one school will transfer to another. Stakeholders also said that advising and information may not be adequate to help students navigate the transfer process. The possible financial implications of transferring depend in part on the extent of credits lost in the transfer. Using Education's transfer data, GAO estimated that students who transferred from 2004 to 2009 lost, on average, an estimated 43 percent of their credits, and credit loss varied depending on the transfer path. For example, students who transferred between public schools—the majority of transfer students—lost an estimated 37 percent of their credits. In comparison, students who took some of the less frequent transfer paths lost a relatively higher percentage of their credits. For example, students who transferred from private for-profit schools to public schools accounted for 4 percent of all transfer students but lost an estimated 94 percent of their credits. Transferring can have different effects on college affordability. Students seeking to obtain a bachelor's degree at a more expensive school may save on tuition costs by transferring from a less expensive school. On the other hand, transfer students may incur additional costs to repeat credits that do not transfer or count toward their degree. Transfer students can receive federal financial aid. GAO's analysis showed that almost half of the students who transferred from 2004 to 2009 received Pell Grants and close to two-thirds received Federal Direct Loans. Students who lose credits may use more financial aid to pay for repeated courses at additional cost to the federal government, or they may exhaust their financial aid eligibility, which can result in additional out-of-pocket costs. While GAO estimated that the websites for almost all schools nationwide provided credit transfer policies, as required by Education, about 29 percent did not include a list of other schools with which the school had articulation agreements. Among those schools, GAO found that some did not have any articulation agreements, while others did but did not list partner schools on their websites. Schools must provide such listings, but they are not required to do so specifically on their website. As a result, students may not have ready access to this information to fully understand their transfer options. Moreover, Education provides limited transfer information to students and their families, contrary to federal internal control standards that call for agencies to provide adequate information to external parties. General information on key transfer considerations that are applicable across schools and more complete information on schools' articulation agreements can help students avoid making uninformed transfer decisions that could add to the time and expense of earning a degree. GAO recommends that Education (1) require schools to disclose on their websites (a) the list of other schools with which they have articulation agreements and (b) when no such agreements are in place; and (2) provide general transfer information to students and families. Education disagreed with the first and agreed with the second recommendation. GAO maintains that students can more easily understand transfer options if information is accessible on a school's website, as discussed in the report.