How to Avoid Student Loan Scams When Applying for Financial Aid

  
     
February 06, 2017

It's that time of year where students are filing their FAFSA and graduating from the Fall semester. With the average 2016 graduate in $38K loan debt, the Better Business Bureau is advising college students and graduates on how to avoid being misled by a student loan company this coming year.

Companies target students with some common schemes such as advanced fees, false loan consolidation, and law firm lawsuits.  Getting hit by a student loan scheme can cause detrimental effects to a student's credit and funds, not to mention their wellbeing. 

Some key points to keep in mind include:

  • Keeping detailed records of any documents regarding your loans
  • Understanding all financial aid and repayment options
  • Researching any and every company you are considering hiring for assistance
  • Reviewing your own financial resources and knowing how to contact your provider

The BBB affirms that you should never feel pressured into giving money or information, make payments to anyone except your provider, give out your FAFSA PIN, or assume someone contacting you about your student loan is your provider.  Resources to consider include:

  1. studentaid.ed.gov/contact
  2. bbb.org
  3. consumerfinace.gov/complaint

BBB urges caution when committing to a debt relief program and encourages consumers to phone the BBB’s help line at (858) 637-6199 or visit the website at bbb.org, to obtain information on student debt relief scams.