South University could face major financial challenges in late 2025 despite being given a clean bill of health by its regional accreditor, the Southern Association of Colleges and Schools Commission on Colleges (SACSCOC). This week, SACS removed the school from Warning status and reaffirmed accreditation for the school, but requested a Monitoring Report within six (6) months.
While South University has been profitable lately, and it currently has more assets than liabilities, it is facing a $36M balloon payment from a $50M Main Street Loan due in December 2025. Main Street Loans cannot be forgiven, and a $36M payment might be difficult to pay out so quickly. SACS is well aware of this impending payment.
South could seek another lender to pay off the Main Street Loan. It could also renegotiate its contracts, reduce staffing, and sell off various assets to continue operating. By moving students online, South University could also reduce costs and consolidate operations.
The US Department of Education already has South University on Heightened Cash Monitoring 1 for disbursement of federal student aid funds.
We have reached out to the school for comment, but they have not responded as of this publishing date. HEI is also waiting on a Freedom of Information request regarding Borrower Defense to Repayment claims, which at some point the school could be liable for.
South University has an estimated 7700 online students, with ground campuses in Atlanta (GA), Virginia Beach (VA), Glen Allen (VA), Round Rock (TX), Columbia (SC), High Point (NC), Montgomery (AL), Orlando (FL), Savannah (GA), Tampa (FL), and Palm Beach (FL). Its online programs are headquartered in Savannah. The school has been in operation since 1899.
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