Boston, Sept. 09, 2022 (GLOBE NEWSWIRE) -- In the wake of the federal student loan forgiveness plan, a wave of student loan debt relief scams are targeting student loan borrowers. MEFA advises the public to be skeptical of information disseminated from sources other than the U.S. Department of Education and their individual student loan companies.
How to Spot Scams
The debt relief scams may be an attempt to collect personal and financial data or to enroll an individual in high-priced services actually available for free elsewhere. Consumers are urged to avoid falling victim to scams and bad business practices by spotting the warning signs, which include:
- A random telephone call offering student loan debt relief, faster repayment, or immediate forgiveness in exchange for an upfront fee
- High-pressure sales tactics, such as insisting the borrower needs to act quickly on a limited-time offer
- Individuals misrepresenting themselves as having a legitimate relationship with the U.S. Department of Education or one of the federal student loan servicers
- A request for personal and financial information, such as loan debt amount, Social Security number, loan account user name and password, etc
- An advertisement on social media or search engines
How to Respond to Scams
To avoid debt relief scams, MEFA advises consumers to take the following steps:
- Never provide personal or financial information over the phone, unless it is a call initiated by you, and you are confident of the identity of the person on the phone.
- Research the company and services being offered to determine legitimacy. Many of the services being offered for a fee may already be available at no cost from your current student loan servicer. Contact your student loan servicer and ask if they provide the services being offered by the debt relief company.
- Do not agree verbally to any debt services, and review documents closely to fully understand the details and cost.
- Keep complete records of communications and documents with any company providing loan services.
The Federal Trade Commission's resources page has information on avoiding scams, steps to take if you were scammed, and instructions on how to report fraud, scams, and bad business practices. For additional information on the Student Debt Relief Plan and avoiding student loan debt relief scams, visit the following:
- Federal Student Aid’s website https://studentaid.gov/debt-relief-announcement/ and FAQ page https://studentaid.gov/debt-relief-announcement/one-time-cancellation, which provide the most up-to-date information related to the Student Debt Relief Plan.
- Studentloanscam.com, which has information on spotting debt relief scams and what to do if you have been scammed.
- American Education Services' page, Beware of "Debt Relief" Organizations, which provides guidance around identifying debt relief scams.
About MEFA
MEFA is a not-for-profit state authority, not reliant on state or federal appropriations, established under Massachusetts General Laws, Chapter 15C. MEFA's mission, since its founding in 1982, has been to help Massachusetts students and families access and afford higher education and reach financial goals through education programs, tax-advantaged savings plans, low-cost loans, and expert guidance. All of MEFA's work aligns with the ever-present goal to support the independence, growth, and success of Massachusetts students and families. Visit mefa.org to learn more or follow MEFA on Twitter @mefatweets, on Facebook at mefaMA, and on Instagram at @mefa_ma.
