Consumer alert: As pause on federal student loans ends, NYS DCP offers tips for borrowers to avoid scams

Student loan borrowers are reminded to only use trusted government websites and not respond to unsolicited offers of student loan relief or assistance

By the New York Department of State’s Division of Consumer Protection

For this week’s “Tuesday’s Tips,” the New York Department of State’s Division of Consumer Protection is providing tips to help federal student loan borrowers avoid scams. As federal student loan borrowers are set to resume payments this coming October after a three-and-a-half-year-long pause, this may cause confusion about the repayment process and make borrowers vulnerable to potential scams.

“As federal student loan borrowers resume making payments, potential scammers will be looking to take advantage of borrowers who may be confused about the process or looking for relief," Secretary of State Robert J. Rodriguez said. “To protect yourself from falling victim to a scam, I urge all New Yorkers to read these tips, stay up-to-date with trusted information, and remain vigilant throughout the entire student loan repayment process.”

New York State Department of Financial Services Superintendent Adrienne A. Harris said, “The return to repayment will involve additional planning for many New Yorkers who’ve been able to build their financial well-being during the payment pause. DFS is committed to ensuring student loan servicers provide accurate and timely information to student loan borrowers, and borrowers are empowered to avoid scams and are in the best position to take advantage of new loan programs.”

What You Need to Know to Avoid Student Loan Forgiveness Scams:

•Don't trust any person or program that promises you special access or guaranteed eligibility. You might be contacted by a scammer saying they will help you get your loan canceled or reduced for a fee. You will never need to pay for advice or help with your federal student loans or any deferment or income-based plans. All federal student loan borrowers can enroll directly and stay updated at no cost by contacting the U.S. Department of Education directly at StudentAid.gov. If you’re contacted unexpectedly with any of these offers, it's a scam. 

•Be wary of scammers who make false claims or say you have an incomplete application. If you have any questions about your application status, go directly to the U.S. government federal student loan portal to access your account and confirm any details. To access the portal, go to StudentAid.gov.

•Stay updated with trusted information and sources. The U.S. Department of Education webpage provides borrowers with accurate and the most up-to-date information about the program. They also recommend logging in to your StudentAid.gov account to ensure your contact information is up to date, and to sign up for alerts for when new information becomes available.

•Protect yourself from phishing scams. If you didn’t initiate the communication, don’t share your personal information. Keep your personal information private, including your Federal Student Aid ID and Social Security number. The U.S. Department of Education will never call or text you with a request of confidential information. Make sure you work only with the U.S. Department of Education, and never reveal your personal information or account password to anyone. Genuine emails to borrowers will only come from [email protected]; [email protected] and [email protected].

•If you encounter a scam, report it. Contact the official Federal Student Aid website to file a complaint, or contact the Federal Trade Commission. The U.S. Department of Education offers additional tips and resources here. You can also contact your loan servicing company or the Federal Student Aid Information Center (FSAIC) at 1-800-433-3243. 

•Don’t forget to regularly monitor your credit report and score. As you begin the repayment process, stay one step ahead and make it a routine to check on your credit report and look for inconsistencies. Visit annualreport.com or call 1-877-322-8228 to get your free reports.

•Looking for help navigating your student loans? EDCAP (Education Debt Consumer Assistance Program) is an independent, New York state-funded, nonprofit program of the Community Service Society of New York (CSS) that helps New Yorkers navigate the student loan system. It offers free, one-on-one counseling with student loan experts. To schedule an appointment, call 888-614-5004 or email [email protected] for more information.

About the New York State Division of Consumer Protection

The New York State Division of Consumer Protection provides resources and education materials to consumers, as well as voluntary mediation services between consumers and businesses. The consumer assistance helpline (1-800-697-1220) is available from 8:30 a.m. to 4:30 p.m. weekdays, excluding state holidays. Consumer complaints can be filed at any time at www.dos.ny.gov/consumer-protection. For other consumer protection tips and consumer alerts, consumers can follow the New York Department of State on Facebook, Twitter and Instagram, and check in every Tuesday for more practical tips that educate and empower consumers on a variety of topics. Sign up to receive consumer alerts directly to an email or phone here.