It can be difficult to navigate the world of student loan forgiveness, particularly considering the possibility of frauds appearing at every turn. Thankfully, the Department of Education (ED) has taken action to alert borrowers by sending out emails outlining their options and defining who may qualify for student debt relief.
Significant loan debt has been accrued by certain students, which can be debilitating and have an adverse effect on people’s life. Borrowers are vulnerable to criminal frauds that fraudulently offer student loan relief now that the pandemic-era relief has diminished. You must know what Student Loan Forgiveness Email Scams are and how to spot them to avoid falling for them.
Student Loan Forgiveness Email Scams
To begin with, the ED has begun emailing borrowers who have federal student loans regarding potential student debt relief. Be on the lookout for these alerts if you have an ED-held debt. Crucially, there is nothing you need to do to qualify for this relief; you can choose not to participate. To opt out, you must speak with your loan servicer if you do not want this assistance. Student Loan Debt Forgiveness is just one example of how scammers frequently leverage current events to make their solicitations seem more credible.
For those who qualify, the U.S. government has declared its intention to forgive up to $20,000 in federal student loan debt. As per ED more than 40 million Americans are eligible to get student loan relief. This presents a large number of potential victims for fraudsters, therefore it is important to increase vigilance at this time.
What is a student loan forgiveness scam?
Offers to help with student loan payments, such as loan forgiveness, payment reductions, or delayed, are made to students by scammers. They might impersonate student services, the Department of Education, loan servicers, or a legitimate third party. Often, these scammers ask for your Social Security number, an upfront payment, or other private data. These scammers take advantage of students’ confusion and steal money and personal information because the student loan relief sector is unregulated and pandemic-era aid has ended.
How to spot a Student Loan Scam
- They demand a processing fee. Participation is completely free. Since there is no cost to apply for student loan forgiveness programs, it is a scam if someone contacts you for a processing charge.
- They use phrases like you need to act immediately to convey urgency: Never will the Department of Education employ aggressive marketing language to pressure you into taking immediate action.
- They make unfulfilled claims: The offer to get more of your loans forgiven than what is permitted by federal criteria is a fraud.
- They want details of your bank account: Do not share your personal data to strangers, especially over the phone. If you receive a call, end it right away.
legitimate student loan forgiveness emails
For the purpose of legitimizing their scam, student loan scammers construct official-looking email addresses and sign them with official seals or logos. You may check your email by hovering over the From/To section. If a government organization sends you an email about student loans, be sure the sender’s email address is one of the following:
Did a Student Loan Forgiveness Scam Affect You? Do This
- Switch up your FSA logins. If your account credentials were accidentally shared with someone, go to the FSA website and update them. If you have already been locked out, get in touch with the FSA.
- Speak with your student loan service provider. Get in touch with your loan servicer to cancel any power of attorney or third-party permission documents you were coerced into signing.
- In order to stop scheduled payments, notify your bank. If scammer has got your bank or credit card details contact your bank as they will stop future payments, reverse charges, and cancel planned payments.
- Contact the CFPB and FTC to report fraud. File a complaint with the CFPB and FTC after you have protected your accounts and credentials. ConsumerFinance.gov/complaint and reportfraud.ftc.gov are the places to file complaints.
- Put your credit report on hold and start credit monitoring. You may prevent criminals from opening new credit lines in your name by freezing your credit record.
- The OIG should be contacted. If you suspect or encounter fraud involving ED money or programs, you can call the OIG Hotline today.
- Bring a grievance before the FSA. Visit studentaid.gov/feedback-center to file a complaint and let the FSA know what went wrong. Additionally, you can use this online gateway to see, monitor, and update your case.
- Make a grievance known to the BBB. Visit BBB website and review the fraudulent business, so you can help stop others from falling for the same scam, but you will not get your money back.
- Take into consideration registering for identity theft protection. Your most private data, online accounts, and funds are all monitored for indications of fraud by any organization’s best-rated identity theft protection. If a scammer attempts to access your accounts or finances, they can assist you in taking prompt action.
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Niamh Prescott has a degree in Mass Communication and an MBA in Finance. She has worked for two media houses and is now running her own media company.