Scam of the day – September 25, 2015 – Student loan debt relief scams

With student loan debt up to 1.2 trillion dollars and many students defaulting on their loans, it is not a surprise that scammers are preying upon desperate former students looking for a way out of debt.  Scammers take advantage of many of these former students who may not be aware of their rights and options.  Some scammers promise dramatic reductions of debt of 50% or more in return for upfront fees of between $500 and $2,500.  Often these scam companies have names that make it appear that they are endorsed by the federal government such as Student Loan Processing.US which is presently being sued by the Consumer Financial Protection Bureau (CFPB).  Part of the problem is that many people seeking relief do a search on Google which turns up advertisements for scam student debt relief companies at the top of the first page.  The CFPB has asked Google to enable searchers to more readily be directed to the U.S. Department of Education’s website where much helpful information is available to help people seeking debt relief without having to pay exorbitant fees for the information.  To date, Google has not cooperated.

Meanwhile the fact is that, according to government studies, 70% of those people in default of their loans actually qualify for income-based repayment plans, but many people are not aware of that fact or how to apply for these programs.  A  recent General Accountability Office (GAO) report faulted the Department of Education for not making people more aware of their repayment options.

TIPS

If you find yourself having difficulties repaying your student loans the first place to turn is the website of the Department of Education which has much information about programs that may provide tremendous assistance without having to pay hefty fees.  Here is the link for the Department of Education’s website section dealing with student loans.  http://www2.ed.gov/fund/grants-college.html?src=go

Leave a Reply

Your email address will not be published. Required fields are marked *