In the wake of President Joe Biden’s announced plan to address student loan debt, many are going online for answers. In recent months, the Better Business Bureau reported that scammers were taking advantage of recent changes to student loan repayment programs to confuse borrowers, tricking them into falling for various schemes.
The expectation is that these scam attempts will increase significantly in the coming weeks and months.
Protect yourself from student loan scammers
- Research the lender. Visit org to read business profiles and check out companies before working with them. The FTC has consumer education related to student loan debt relief scams at ftc.gov/StudentLoans.
- Report it. If you have been a victim of a suspected scam, report it at org/ScamTracker.
- Empty promises lead to an empty wallet and more debt. Only scammers promise fast loan forgiveness. Scammers often pretend to be affiliated with the government. Never pay a fee upfront for help. Never share sensitive information, such as your FSA ID.
- Find a reliable source. Consumers can apply for loan deferments, forbearance, repayment and forgiveness or discharge programs directly through the U.S. Department of Education or their loan servicer at no cost and do not require a third party. For students in Canada, find more information about student loans and grants.
the BBB says if it seems too good to be true, it probably is. A company that claims it can erase student loan debt in minutes is not being honest. This type of scheme is similar to a government impostor scam watch for the warning signs.