Student Loan Forgiveness Scammers
Security
Student loan forgiveness has been in the news lately since changes to the Public Service Loan Forgiveness (PSLF) program were put into effect, which will ideally save many public servants—including teachers, nurses, government workers, and people who work at nonprofit organizations—thousands of dollars. With the changes have come headlines about who the program benefits, who is missing out, and confusion about how it works—so it’s no wonder that scammers have taken the opportunity to defraud people.
As quoted on CNBC.com, Kristen Evans, chief of the students and young consumers section at the Consumer Financial Protection Bureau, says, “Scammers really prey on the financially vulnerable, and so with the pandemic, many people have been struggling financially and they are looking for financial relief. This just creates the perfect breeding ground for scammers to take advantage of people.”
Types of student loan forgiveness scams
One of the two most common student loan forgiveness scams in 2021 involves convincing people to pay a fraudulent company for loan deferment services that are free through the government. Another typical scam encourages people to pay a fee to have their loans forgiven, only to have their money stolen and still be stuck with their loans.
How to protect yourself
Always be wary of email or phone offers or of advertisements promoting assistance with student loan forgiveness. And never give anyone money for this service. Should you be eligible, the government does this for free.
The best way to protect yourself is to initiate conversations about your loans directly with your student loan lender. We also encourage you to follow the news for specifics as the PSLF program develops. Forgiveness could still be on the horizon for you, but anyone offering it to you now—especially for a fee—is very likely a scammer.
Learn more about ways to keep yourself protected here. Please note, while Harborstone doesn’t offer student loans, we do offer a variety of other loans, including a personal line of credit (PLOC) or a home equity line of credit (HELOC), to assist with debt consolidation or other financial needs.
