3 Signs To Watch For With Companies Claiming To Help You With Student Loan Debt

26 May 18

 Student loan debt

According to Mark Kantrowitz, a student loan expert, the only thing these individuals are doing is filling the paperwork out for you. They get the information they need from you by you filling their forms out.

The Federal Trade Commission is going after companies that offer debt relief services, claiming they are charging consumers illegally and fails to deliver on their promises. The FTC said the companies would charge a monthly fee that was allegedly going toward the repayment but wasn’t.

In fact, many of these companies would allow payments to lapse, which led to seized tax refunds, garnished wages and bad credit. How do you know if a company is a scam?

There’s An Upfront Fee

Companies are not permitted to charge you before they have helped you to decrease or eliminate your student loan debt. If they say you must pay before they do anything may end up not helping you. Think of it this way: why are you paying to save money?

Promises Of Quick Results

Anytime a company says they can quickly get rid of debt, be wary. If they have yet to review your case or promise to eliminate it via a loan forgiveness program, they cannot make that promise.

Forget those companies that leave you voicemails, send you texts, messages and emails, saying you need to act now or you could miss out on the eligibility for forgiveness program.

They Want Your Federal Student Aid ID

Do not ever give out your FSA ID, as companies use it and other information to scam you.

Always reach out to your lender to see what you can do about your existing student loan payments such as reducing your interest rate or refinancing your loan.