According to the FTC, student loan relief scams have swindled over $95M from borrowers over the years. The FTC announced this month that they will be working with attorney generals from 11 states to crack down on student loan scammers and increase awareness of loan relief schemes.
How the scam works:
Scammers offer borrowers “student loan debt relief” by charging upfront fees and monthly dues for oftentimes free services offered by loan providers. Scammers will then convince borrowers to give up their loan account credentials, change their passwords and then allow the payments to lapse, causing them to have their wages garnished, tax refunds seized or Social Security benefits cut.
Tips to Avoid Becoming a Victim:
If you feel you have been misled by a company offering debt relief or assistance consolidating your student loans, you should file a complaint at bbb.org, your state Attorney General’s office and the Consumer Financial Protection Bureau (consumerprotection.gov).