Scams!

College students are more at risk of identity theft than any other group. If another party gets a hold of your social security number, name, address, and birth date, they can use this information to file taxes fraudulently, set up credit cards in your name and put you in debt, and completely destroy your credit which will make it impossible to qualify for decent apartment rentals, future loans, and in some cases even jobs. One way that these third parties get this information is through fake scholarships – never, ever give your social security number or bank account information to any scholarship foundation, and never participate in any scholarship program that wants you to pay, with the exception of the occasional portfolio review fee (sorry, artists). And remember, the first “F” in FAFSA stands for “free”. You never need to pay to get help with the FAFSA, or any of your federal student loans. 

There are a ton of scams out there, but you’re going to start seeing a lot more of one in particular: student debt relief. Because of recent news regarding for-profit colleges, these scams are becoming more and more common. You’ll see 1-800 numbers for companies that claim to be able to reduce your student loan debt completely, asking you to call to talk about your loans, and companies that claim to be able to get rid of your debt for several hundred dollars in return. But keep this in mind:

Any real information regarding debt relief will come directly from one of three sources – the financial aid office, your loan servicer, or the federal government. 

There are several websites out there that appear to be tailored to specific schools, but if they were real we would tell you about them. Further investigation will reveal that these websites have ads tailored to many different schools. If you see something you think is suspicious, but you’re not sure, let us know about it – email us at any time to find out if these offers are legitimate, even after you graduate. Want to know more about the top four warning signs that what you're looking at might be a scam? Check out this link.

For federal loans, your debt can not be contested or forgiven unless you qualify for forgiveness under one of several repayment plans (which usually also means you’ve been making payments for about ten years or more), or you die. In rare cases, when schools lose accreditation or, in the case of the for-profit schools that recently closed, are revealed to be scams that do not produce degrees, the federal government will forgive your debt. However, this news will come directly from your loan servicer. It’s important to stay in contact with them for this reason. Any offers to reduce federal debt that come from a third party – somebody who is not an official Cornish representative, your loan servicer, or the federal government – are not real. 

Keep in mind, if a company promises to clear your debt, legally they have to clear a certain percentage first before they take any payment from you. If they ask for money up-front, it’s a sign that they’re not really there to help you. If you read their fine print, especially if you have federal loans, you’ll see what you’re really paying them several hundred dollars to do is file just a little paperwork that you could do yourself with help from your servicer for free. Your loan servicer is there to help you with your loans, for free. There are several repayment programs that exist to help you if you’re not making enough money to afford to make your monthly payments, and a simple phone call to them will result in help, so you never need to pay a third party. 

Do you have questions about student loans? Concerns about what life is like once repayment starts? Have you seen any of these scams? Let us know by commenting below or sending an email to hereforyou@cornish.edu.