Avoid Student Loan Scams

The latest scams focus on student loan forgiveness. Here’s how to spot them — and how to get help with your student loan.

“(Student loan forgiveness) scams come in all shapes and sizes, from phone calls and emails to text messages,” wrote an unnamed blogger for Federal Student Aid, an office of the U.S. Department of Education. “You may encounter scams tied to current events. But sometimes it’s as simple as a fake promise to work fast and save you lots of money.”

The U.S. Department of Education says these are the telltale signs of a student loan forgiveness scam:

• UPFRONT OR MONTHLY FEE FOR IMMEDIATE STUDENT LOAN CANCELLATION. Legitimate loan forgiveness programs will require months, if not years, of qualifying payments plus proof of employment.
• REQUEST FOR LOGIN/PASSWORDS. Specifically, your StudentAid.gov login information. Real loan forgiveness programs will never request that.
• TYPOS. Someone skipped English class — and that someone is typically a scammer. Student loan ‘savior’ scams are notorious for glaring typo and grammatical errors in their emails, letters or texts.
• UNOFFICIAL ADDRESSES OR PHONE NUMBERS. Does that address, email or number REALLY reach the legitimate agency it claims to be? Loan forgiveness scammers will often use real agency logos or seals, pretending to represent those organizations. Stop communicating with that unsolicited offer. Research the REAL agency claiming to contact you, then initiate your own contact with that agency to seek professional help.

Student loan scams hit their peak in 2017. It got so bad, the Federal Trade Commission (FTC) launched a joint federal-state task force to hunt down student loan scammers. Called Operation Game of Loans (a play on Game of Thrones), its investigators said virtually every case involved bogus upfront fees and empty promises of “pre-qualification” or “pre-approval” to bait its victims.

If you’re struggling with a student loan, the first thing you should do is contact your loan servicer. Your servicer can do things for you at no cost — things most debt relief companies (real or fake) would charge a fee to do.

Things like:

• LOWER YOUR MONTHLY PAYMENT. If you’ve never been delinquent in making your payments, your servicer may lower your payment just for the asking.
• CONSOLIDATE MULTIPLE STUDENT LOANS.
• SWITCH TO A NEW PAYMENT PLAN.
• SEEING IF YOU QUALIFY FOR LEGITIMATE STUDENT LOAN FORGIVENESS.

Burdened by your student debt? Confused by that mysterious email, letter or text? When in doubt, contact the Federal Student Aid Information Center — the REAL one — at 1-800-433-3243.

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