Published on May 12, 2022 at 07:06
Scammers Target Student Loan Debt
Student loan debt is a bigger burden than ever, with more than 43 million people carrying outstanding federal student loans.
And while federal loan repayments have been suspended again through Aug. 31, consumers holding that debt are eager for relief.
And criminal scammers are eager to take advantage of consumers.
How it works
• You receive an unsolicited contact offer to help you navigate through state and federal programs to help you reduce or restructure your debt.
•“Debt relief experts” can provide access to instant and easy-to-access loan forgiveness options, often related to the COVID-19 pandemic.
• These companies may ask for an upfront payment or personal information such as social security numbers or FSA ID (the username and password on your loan account).
What you should know
• There is nothing that these companies can search for you that you cannot legitimately find for free on your own. Often it’s as simple as contacting your loan officer or the US Department of Education.
• It is illegal for debt relief companies to collect payment from you before getting results, so upfront fees are a sure sign of a scam.
• Legitimate agencies and loan servicing companies will not ask you for information such as a social security number or FSA ID.
what you should do
• Visit the Department of Education’s StudentAid.gov site for free information on getting federal student loan assistance.
• Resist the urge to act quickly. Find out about a debt relief company before providing them with information or money, or signing any agreements. A good place to start is your state’s consumer protection office or the Better Business Bureau.
• Report suspected student loan fraud to the FTC and the Federal Office of Student Aid.
When it comes to fraud, vigilance is the best weapon. You have the power to protect yourself and your loved ones from scams. If you can SPOT a scam, you can STOP a scam.