Student Loan Debt Forgiveness Scams

Student Loan Debt Forgiveness Scams

October 24, 2022

Tagged As: Personal

Do you have student loan debt? While many borrowers may have their federal student loans forgiven, the details are still under works. But in the meantime, scammers have jumped into action.

Similar to 2020 and 2021, when scammers pretended to be IRS agents or other government officials to perform fraud under the guise of sending stimulus checks, fraudsters in 2022 have started to take advantage of student loan borrowers to steal their money and identities.

Here’s what you need to know to protect yourself from student loan scammers.

Debt Forgiveness Red Flags

If you’re asked to do any of the following things, it’s likely a scam!

  • Pay up-front costs or monthly fees: Scammers want to trick you into paying them money in order to “process” your application. This is illegal, and the government will not charge you fees in this way to have your federal student loans forgiven.
  • Provide your Federal Student Aid ID: This ID is used to log in to your account – and access sensitive personal documents. Scammers would use that information to steal your identity.
  • Act immediately to qualify: A common scam tactic is to create a sense of urgency around the fraudulent request, so victims don’t have time to think through what scammers are asking for. If you qualify for federal student loan forgiveness, the government won’t pressure you to apply immediately – only scammers will!

When the legitimate student loan forgiveness application form is available, borrowers won’t need to provide sensitive personal financial information up front – according to the Biden administration. However, the Education Department may later verify applicant income as part of fraud prevention measures.

What if I have private student loans?

The federal government does not have the ability to forgive student loans borrowed through a private financial institution. If you receive a communication telling you to apply to have your private student loans forgiven, it’s probably a scam. Be sure to check with your loan provider if you have any questions or wish to verify that a message or phone call is legitimate before giving away any sensitive personal information.

Report Debt Forgiveness Scams

There are a number of official resources to report scams and receive assistance:

Federal Student Aid Feedback Center

Better Business Bureau Scam Tracker

FTC Fraud Report

If you believe your bank account may be compromised, please reach out to us at 1-800-445-5725 or by using the chat button at the bottom of this page.