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More than 46 million Americans share $1.75 trillion in US student loan debt, according to the Federal Trade Commission.
For many of us, the idea of cutting down our massive student loan debt at the snap of a finger can be an enticing idea.
“Sign up now and save BIG on repayments! We’ll help you get your student loans forgiven in as little as FIVE years! Lower your monthly payments!”
The claims are tempting, but they’re also dangerous and unrealistic. These quick-fix claims are scams, and the Federal Trade Commission has started to crack down on them to protect you and your money.
Here, we’ll outline common student loan forgiveness scams, tell you how to be on the lookout for them and highlight legitimate programs that help student loan borrowers.
The Fight Against Scammers
In 2017 the FTC announced its new initiative to fight student loan forgiveness scams: Operation Game of Loans.
The fight continues today. Just last year, the FTC made waves when it sent $1.7 million in refunds to borrowers who were duped by a company called The Student Debt Relief Group. The fraudulent company claimed they were affiliated with the Department of Education while charging illegal upfront fees, as well as monthly fees, they claimed would be credited toward consumers’ loan balance. The company pocketed the money, then simply changed its name after the complaints started piling up.
By taking these fake companies, like the Student Debt Relief Group, to court, the FTC has returned nearly $12 billion to more than 10 million borrowers who were duped by student loan forgiveness scams.
Whether you’ve been defrauded by a fake student loan debt relief company or not, it’s good to know the government has your back in fighting against the thieves.
In the meantime, how can you make sure you don’t become a victim of student loan scams?
4 Ways to Spot Student Loan Forgiveness Scams
Whether you have outstanding student loan debt from federal loans or…
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