FTC action:
Quote:
FTC continues to crack down on student loan scams
March 8, 2018
by Ari Lazarus
Consumer Education Specialist, FTC
A lot of us have student loans – and some of us have trouble paying them every month. Some companies claim to resolve that issue by saying they can help you pay them down quicker, cheaper or get them forgiven altogether. Be cautious – some of these companies are running scams.
Here are some tips to avoid student loan repayment scams:
Never pay an upfront fee. It’s illegal for companies to charge you in advance before helping you to reduce or get rid of your student loan debt. Companies that make you pay upfront might give you no help and not give your money back.
Only scammers promise fast loan forgiveness. Before they know your situation, scammers might say they can quickly get rid of your loans through a loan forgiveness program. But they can’t.
A Department of Education seal doesn’t mean it’s legit. Scammers use official-looking names and logos and say they have special access to certain federal programs. They don’t.
Don’t share your Federal Student Aid (FSA) ID with anyone. Scammers could use it to take control of your personal financial aid information on U.S. Department of Education websites.
Last month, the FTC announced a lawsuit against American Financial Benefits Center (AFBC), Financial Education Benefits Center (FEBC), AmeriTech Financial, and Brandon Demond Frere as part of its crackdown against unlawful student loan debt relief practices, Operation Game of Loans. The FTC alleges that the companies charged illegal, upfront fees and failed to deliver on their promises to enroll people into a government program that they claimed would permanently lower monthly loan payments or result in total loan forgiveness.
The FTC also alleges the companies charged a monthly fee for the life of the loan (typically 10-25 years) and represented that the fee would go towards the student loan balance. But it didn’t.
You don’t have to pay for help with your student loans. There’s nothing a company can do for you that you cannot do yourself for free: federal borrowers can start with StudentAid.gov/repay; private borrowers can start by talking with their loan servicer.
Spotted a scam? Let us know about it.
Tagged with: loan, scam, student
Blog Topics:
Money & Credit, Jobs & Making Money
Comments
CONCERNED CITIZEN | March 8, 2018 |
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Companies are ROBO calling people asking for passwords SSNs and pretending to be a representative of the federal Government. The people have foreign accents.
The FBI needs to investigate as some information for Student loans had to be compromised somewhere. Please stop the selling and sharing of information as it is putting the entire country at risk.
Kelly | March 8, 2018 |
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Im so worry now I had a company contact me regarding an loan forgiveness program which required me to pay up front fees of 200 an month for 4 months,they stated after that my monthly payment would be only 30m... the company is called Premiere Student Loans..Is this company a scam too?
Bridget Small - FTC | March 8, 2018 |
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It is illegal for a company to charge you before it helps you reduce or get rid of your student loan debt. A company that makes you pay upfront might give not help you and might not give you a refund.
If your loan is from the federal government, you can go to StudentAid.gov/repay for information. If your loan is from a bank or other private lender, talk to your loan servicer about repayment. You can report the company to your state Attorney General.
Spencer | March 9, 2018 |
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Hi Kelly, I did the same thing last month with the same company, I'm not sure if or how I can follow your post. I hope it was legit...a little nervous now
Joanne F | March 8, 2018 |
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I have been receiving calls concerning my student loan which I do not have. I have started writing down the number each time I receive a call. On 2-26-18 and 3-2-18 the number was 540 856-3924. I do not talk to these people, I just hang up.
msoregon | March 8, 2018 |
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I received a call claiming that they were from the IRS, the phone number was listed on my caller id, I called the IRS to let them know and also gave them the phone number, I don't fall for scams, I don't even trust the real people. Its a shame that you can't trust people and I don't see how they can sleep at night, making people scared.
Cicero | March 8, 2018 |
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My friend got scammed few years ago for student relief help program for $300, back then we didn't know what to do, its probably too late to do anything about it even though she has all documents, it left her in a deep depression, and now the Gov. has a company to help her, but they look at your gross income instead of net, then calculate payments upon gross income, which they don't think about your rent, utilities, car payments & insurance. Its sad because the interest rate is so high she will never pay it off. So sad the way the Government affiliates companies treat hard working Americans.
Colonel Buddy | March 8, 2018 |
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Thank you for your flow of Cyber Security info. If we could all team together to report every incident to FTC we would stem the heavy losses the public is experiencing. Then the hacjkers and scammers would have to find oter means of income. Keep it up FTC.
cbon | March 8, 2018 |
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I am 80+ years young and keep receiving these calls to help me with my student loans. I just tell them to "send me the money" and they hang up.
P.J. | March 8, 2018 |
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That's a good one!
