Guest Editorial by the Better Business Bureau
The Biden administration recently announced the federal government will cancel up to $20,000 of federal student loans per person. Millions of Americans will receive student loan debt relief; unfortunately, this creates an excellent opportunity for scammers. See our recent warning about student loan forgiveness scams.
As student loan holders navigate the new forgiveness program, con artists will undoubtedly be there to take advantage of any confusion. It happens with any big government initiative, including the COVID-19 vaccine roll-out, eviction moratorium, and pandemic relief programs.
Always be sure to do your research before sharing any personal information.
Tips to avoid student loan forgiveness scams
√ Get to know the terms of your student loan and the relief program before acting. Always do your research before sharing personal information. Be sure to understand the ins and outs of your specific loan, and how student loan relief impacts you. For information, go to official government websites, such as www.ED.gov and www.studentaid.gov.
√ Never pay money for a free government program. Scammers often trick victims into paying for free government programs – or they claim you can get additional benefits, faster benefits, etc., for a fee. A real government agency will not ask for an advanced processing fee. These are all red flags of a scam.
√ Be wary of out-of-the-blue calls, emails or text messages claiming to be from the government. Generally, the government will not contact you using these methods unless you grant permission.
√ Watch out for phony government agencies or programs. If you speak to someone claiming to be a government representative offering you student loan relief, research before you agree to anything. Scammers often make up look-alike government websites that sound similar to legitimate agencies or programs.
√ Think something seems suspicious? Reach out to the agency directly. If you are concerned about an alleged government representative's legitimacy, hang up the phone or stop emailing/texting. Then, report suspicious calls or messages.
√ Be careful – even if the information comes from a friend. Even if a close friend or family member you trust sent you the information regarding student loan relief, make sure the claims are real first. During the COVID-19 pandemic, BBB received many reports of hacked social media accounts being used to spread government impostor scams.
For More Information
Read more on www.BBB.org about scams targeting recent college graduates and government impostors. Get further insight by reading BBB’s loan and credit repair services tips.
If you’ve spotted a student loan forgiveness scam (whether or not you’ve lost money), report it to www.BBB.org/ScamTracker. Your report can help others avoid falling victim to scams.