This is a scam where a firm will claim to be ready to settle your student loan debt. There are tons of variations on this student loan scams, but typically a borrower is mentioned a firm by a “student aid company”. the scholar aid company promises that this firm can settle your student loan debt for thousands but you owe.
Many times the firm will ask you to form your full student loan payment to the the firm itself (or whatever amount you’ll afford to pay). The firm says they’ll then negotiate a settlement together with your lender.
However, what typically happens is that this firm doesn’t make any payments while negotiating together with your lender – intrinsically , you enter default your student loans. At that time , the firm will then claim you cannot pay your bills, and check out to barter a settlement supported that.
What happens to you, because the borrower, is that your credit score is trashed, and you made thousands of dollars in payments to the firm . within the end, there’s no guarantee that you simply are going to be ready to settle your loans. And albeit you are doing , the method may take years, and you will still need to affect the settlement within the end. If you’re considering chatting with a lawyer about your student loan debt, study what a lawyer can do for your student loans.
Immediate Student Loan Forgiveness
If the company assures you that they can have your student loans forgiven, that should be your red flag. According to the U.S. Department of Education, no one can promise immediate and total loan cancellation or forgiveness.
Most federal forgiveness programs take years of qualifying payments or employment in a qualified public service position. If a company says they can somehow work out a way for you, they’re deceiving you. It’s simply not true.
When A Company Asks For Your FSA ID
You should be wary when a student debt relief company asks you for your FSA ID or password. Even the U.S. Department of Education will never ask for your FSA ID or password. If anyone gets a hold of this information, they can use it for numerous atrocious purposes. For example, they can make changes to your account.
Asks For Power Of Attorney
Has any company asked you to grant them power of attorney? This is a clear indication of fraud. If a debt relief firm asks for legal authorization to make decisions in your stead, you should run.
The Companies Don’t Look Professional.
The fraudulent companies are terrible at communications. They don’t look professional. If you’ve ever received an email or any printed information, you’ll find lists of grammatical errors. That’s a perfect sign that the company is not legitimate.
According to the Federal Communications Commission, you can receive robocalls from people who promise financial relief. You can only make any changes to your student loans with your loan servicer. And that will have to be in partnership with the U.S. Department of Education.
If you receive any calls from anyone telling you otherwise, you’re dealing with a scammer.
The Right Way To Get Assistance With Your Student Loans
All payments and interest are currently waived on almost all federal student loans until January 31, 2021. That means if you have qualified federal student loans, you can skip payments and not worry about any accruing interests until February 2021.
It’s possible that the federal government can extend the temporary forbearance. So you should regularly check on the official FSA page. Also, keep in mind that you can change some of the terms on your student loans with your loan servicer.
For example, you can change from the standard ten-year repayment plan to an extended repayment plan. That way, you could have lower payments every month. You can also check out if you’re eligible for loan forgiveness programs targeted at particular professions or other service programs such as PSLF.
You can also check if you can repay your student loans on an income-driven repayment plan. However, whatever happens, don’t fall prey to the mails and calls from a company that says they can get rid of your student loans for you. They can’t help you, and they might even steal your assets or your identity.
No. They’re not. Yes, you don’t need to pay anyone to take care of your student loans for you. You can do it yourself at StudentAid.gov. However, some people need help, which is fine—all you need is to find a legitimate student loan relief company.
We know this might sound counter-intuitive, but you can call your student loan servicing company. You can solve 80% of your concerns, and issues can be resolved when you talk to your loan servicer. If you don’t prefer student loan servicing, you can speak with a financial planner who’s an expert in student loan debt.
You can also reach out to us. At Student Loans Resolved, we help you figure out what to do with your student loans. We assist you through the entire process until you attain your financial freedom. Contact us at 800-820-8128, and we’ll help you out.
How To Report Student Loan Scams
If you come across a fraudulent company, file complaints with the Consumer Financial Protection Bureau (CFPB). You can also send your complaints to your state attorney general’s office and the Federal Trade Commission. These organizations rely on consumer complaints to protect students from scammers. They can also get your money back to you when possible.