As the average student debt per borrower grows year after year, so does their desperation to pay them off. On that note, student loan forgiveness seems to be the Holy Grail of repayment options – as well as a golden opportunity for the avid scammer.
Scammers are looking to cash in on borrowers’ desperation to find fast ways to pay down their loans. And it can be difficult for borrowers to tell the difference between a legitimate offer and one that they’ll regret down the road.
What Happened to One Woman
One woman interviewed by Valley News Live in Fargo, ND shared her tale about an offer she received in the mail. The woman was slated to repay her loans for 20 years and had received an offer in the mail that claimed she could have a lower monthly payment and be done with her student loans in 10 years.
But when she contacted them to pursue the loan, she was concerned about some of the information they asked for, including a routing number, a bank account number, and a credit card number.
Because this woman was employed by a nonprofit, she did meet the requirements for loan forgiveness, but she didn’t need a third party to access those benefits – and she didn’t need to pay for it, either.
To make matters more confusing for this woman, the letter she received included her whole Social Security number and a figure that corresponded with how much she owed in student loans.
Whether that information was received by this third party through a breach in data security or by using a computer with public access isn’t clear.
How Borrowers Can Avoid Falling Prey to a Scam
This most recent student loan forgiveness scam is just the latest in an ongoing battle between student debtors and scammers. Just towards the end of last year, a text message scam in Missouri was circulating around in the hopes of duping a desperate student loan borrower.
One of the best ways to avoid being a scam victim is to never give out personal information. This woman was right to be skeptical when she was asked for personal information involving her account numbers. As a rule of thumb, skepticism can be a helpful ally when dealing with scammers.
Any third party that contacts a borrower and says it’s a government-affiliated program should immediately be treated with suspicion. For-profit student loan relief companies are not associated with the federal government.
And finally, to better protect themselves, borrowers should read all the fine print on any documents they receive because the devil is often in the details.
How to Find Out if a Borrower Qualifies for Loan Forgiveness
A borrower can review the qualifications for student loan forgiveness programs to help educate themselves as to whether they are eligible or not.
The best way to make certain a borrower qualifies for forgiveness is by contacting their loan servicer. Those who do qualify must make all the required payments even while their case is being reviewed – if they fail to do so, they may jeopardize their standing in the forgiveness program.
Borrowers should keep in mind that one of their loans may qualify for forgiveness while another loan may not. People who receive student loan forgiveness on only part of their loan balance must continue to make payments on the remainder until it is fully paid off.
Author: Mike Brown
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