The rollout of the federal student loan debt relief plan has been held up by the courts, but that hasn’t stopped scammers who see it as an opportunity to liberate you from your money or identity. There are hundreds of billions of dollars involved in the program, which makes for a target-rich environment.
Student loan scammers are capitalizing on the confusion surrounding the rollout by contacting borrowers with offers to help them through the application process and promises of an expedited loan forgiveness. They come across as legitimate, claiming they’re affiliated with the Department of Education, or your loan servicer, and they might even know a thing or two about your loan. Armed with just enough personal information to make them seem legitimate, they proceed to ask questions to “confirm” it and draw out more details about you and your loan.
They then provide you with an official-looking debt relief application, which might include a direct deposit or Power of Attorney form, which allows the scammer to draw down money from your bank account. They may also ask for your federal student aid (FSA) ID. If you provide that, they could lock you out of your loan account so you can’t check your balance. Meanwhile, the scammer has your money, and your loan goes unpaid.
If you are ever approached by someone offering to facilitate your loan forgiveness, here are three things to remember:
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