Scam Alert: Beware Student Loan Forgiveness Scams
Sep 20, 2016
Have you seen offers for fast and easy forgiveness of your student loans? Do they sound too good to be true? That’s because they are! Watch out for scams that target students claiming they can erase your student loans.
You may see a post on Facebook or receive a phone call from someone claiming that they can erase your student loan debt. These con artists attract victims by marketing official-sounding programs, some of which don’t exist, or they offer “free” services that aren’t free at all. They often do this by providing a link from Facebook to a fraudulent or misleading website landing page.
Once they’ve “hooked” you on the website, the company asks for an upfront fee to negotiate with your student loan lender on your behalf. They often claim they’ve helped numerous other clients, but don’t believe them! Student loans can only be only be forgiven under very specific circumstances, which are not fast or easy. These scammers will simply take your money and disappear.
If it seems too good to be true...it probably is.
The Better Business Bureau offers these tips to avoid student loan scams:
•Never pay upfront. Legitimate lenders typically charge for service once the service is complete. You should not be required to pay an upfront fee beforehand.
•Know your options. If you are having trouble paying your student loans, contact your lender directly. The federal government offers payment assistance programs.
•Never give a third party power of attorney. Do not sign anything giving a company the power to negotiate on your behalf. A scam company can use this to take control over your loans.
•If it seems too good to be true...it probably is. Any company guaranteeing services that quickly “erase” student loan debt is not being truthful. This is a red flag.
If you are struggling with a student loan, the Consumer Financial Protection Bureau (CFPB), an independent agency of the U.S. government, has a website which offers legitimate information and help. For more information, visit the CFPB website at //www.consumerfinance.gov/paying-for-college/repay-student-debt/#Question-1.