Scams have been thriving in different sectors. Student loans are not an exemption based on the presence of well-crafted scams from companies alleging to offer relief.
Borrowers often get emails, phone calls, and texts among other forms of communication that they will be given relief from federal student loans.
Moreover, they have been cautioned that loan forgiveness plans catering for students could cease soon.
The alleged relief on student loans is usually a form of scam that fraudulent companies use on their targets.
Scams are well-orchestrated
False declarations are usually used by alleged relief companies when communicating to their targets. Some of them include:
- You should act instantly as this will enable you to get student loan forgiveness as the plan is about to be terminated.
- You are suitable to gain from a recently passed law about federal student debt where entire forgiveness is applicable in some instances.
- You are advised to call in thirty (30) days upon getting this notification.
- You may meet the criteria of a full discharge.
- Your forgiveness verification is pending so call immediately.
These communications are well-crafted and once coupled with aggressive publicity, some borrowers are easily lured into these scams.
Scams from “relief companies”
A relief organization claiming to assist in student loan debt is usually after a victim’s cash. The declared service is not free as it has an associated cost that is made monthly or up-front.
Borrowers are often scammed whenever they make such payments. Some of the alleged services include getting a borrower’s loan out of default.
The scams also usually guarantee entire and instant loan cancellation. Borrowers are also asked for their FSA ID.
Moreover, a power of attorney is asked whereas their communications have grammatical and spelling mistakes. These aspects should be considered red flags that people should not ignore.
Debt relief corporations involved in student loan syndicates are private institutions claiming to offer administrative student loan services at a cost. At times the claimed assistances can be effortlessly undertaken by borrowers.
Some of the allegations availed include the reduction of a person’s monthly payment or loan forgiveness realization.
Amicable strategies to curb scams
These companies are not associated with the U.S. Department of Education, but this is a claim that they usually make. Additionally, they often target their victims through serious marketing online, on TV, and in print among other avenues.
At times, they provide a borrower’s information about loan balances whenever they communicate to woo victims about their legitimacy.
Nevertheless, the Federal Trade Commission (FTC) and various government institutions have come up with amicable strategies to curb them.
Student loan cancellation has been a debated topic as showcased by Bernie Sander’s sentiments. This has made relief companies take advantage of this situation by presenting different scams.