More than forty-two million Americans have student loans with an outstanding balance of more than 1.4 trillion dollars so it is no surprise that scammers are focusing their attention on these students and former students through scams that falsely promise to provide debt relief. I have written numerous times in the past about various student loan debt relief scams. Rececntly the FTC settled claims it brought in October of 2017 against the operators of two student loan debt relief scams Student Debt Doctor (SDD) and American Student Loan Consolidators (ASLC). Both companies had their assets frozen by federal courts following the initial complaints being filed against these companies. Under the terms of the settlement both companies are banned from the debt relief business forever and ordered to pay millions of dollars in fines. Both companies collected illegal upfront fees and falsely promised to help consumers through government programs they promised would reduce or forgive their student loans.
In October of 2017 the Federal Trade Commission, working with the Attorneys General of eleven states, launched what it cleverly calls, Operation Game of Loans to jointly target these scams. 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 in order to trick people into trusting them.
The old adage still is true. If it sounds too good to be true, it probably isn’t true. Many of these student loan debt relief scammers promise quick loan forgiveness, which is unrealistic. In addition, you should never pay any upfront fees for student loan debt relief assistance. Those fees are illegal and are a sure indication that you are being scammed. Also, remember my motto, “trust me, you can’t trust anyone.” Don’t trust scammers merely because they use names that sound like they are affiliated with the government. ASLC falsely claimed that it was affiliated with the U.S. Department of Education, which it was not.
For information you can trust about federal student loan repayment option, go to https://studentaid.ed.gov/sa/repay-loans . There you can learn about loan deferments, forbearance, repayment and loan forgiveness programs and there is never an application fee. If you owe private student loans, contact your loan servicer directly.
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