Student loan scammers are going after people WITHOUT loans, too
Students in the U.S. got a reprieve from paying back hefty federal study loans during the pandemic, with the government putting a halt on repayments. The deal was initially set to expire in January 2022 but got extended to May.
But as students prepare to get their financials in order, cybercriminals are on the prowl. Tap or click here for seven new scams to watch out for.
Read on to discover how scams are on the rise and what you can do about them.
Here’s the backstory
Scammers are now targeting victims with a new set of student loan schemes. And to make matters worse, you don’t even need to have student loans to be targeted.
Here’s how the schemes typically begin. Thieves pose as helpful student loan agents, only to walk away with the victim’s money. Such a scam comes in many forms, and it usually starts with a phone call.
According to NPR, criminals randomly call people to offer assistance in getting their loans forgiven. To do so, the scammers ask for the victim’s private details such as banking information, credit card details or Social Security number.
As usual, the criminals want to instill a sense of urgency. “This message is from the Department of Education. All programs for student loan forgiveness will be stopped immediately. For you to qualify, you must apply within the next 24 hours,” NPR reports as one of the received voice messages.
What you can do about it
Student loan scams are getting so bad that the FTC recently issued a warning. It said criminals are calling, texting, and emailing to try to use any confusion around restarting your student loan payments to steal your money and personal information.
If you get a call, text, email, or message on social media from someone about student loans, here are ways to avoid falling victim:
- Never pay upfront fees – It’s illegal for companies to charge you before they help you. If you pay up front to reduce or get rid of your student loan debt, you might not get help or your money back. Also, remember there’s nothing a company can do for you that you can’t do yourself for free. And you never have to pay to get help from the Department of Education.
- Protect sensitive information – Never give out your Federal Student Aid ID, Social Security number or other personal information to anyone who contacts you. Scammers posing as student loan servicers can use this information to log into your account, change your contact information, and even divert your payments to them. Instead of giving out your FSA ID, call or contact your servicer.
- Avoid quick loan forgiveness – Scammers might claim they can eliminate your loans before they know the details of your situation. Or they might promise a loan forgiveness program that most people won’t qualify for. They might even say they’ll wipe out your loans by disputing them. But they can’t.
- Watch for spoofing – Scammers use fake seals and logos to lure people in. They promise special access to repayment plans, new federal loan consolidations, or loan forgiveness programs. It’s a lie. If you have federal loans, go to the Department of Education directly at StudentAid.gov.
As federal student loan payments are set to resume, watch out for scammers
Repaying a hefty student loan can take years and a lot of hard work. With so many people impacted by the COVID-19 pandemic, last year the government put a pause on federal student loan repayments.
Now the Coronavirus emergency relief program is set to come to an end in just over a month and those payments will resume. Need to save money? Tap or click here for how to get a student discount at Apple (and you don’t need a student ID).
The new, convincing tactic phone scammers are using to steal your money
As part of the recently passed COVID stimulus package, many Americans will receive early payments from the child tax credit. Those are scheduled to be mailed out by the IRS between July and December.
The first half of the child tax credit will be allocated during the scheduled 6 month period, and the rest will be completed when you file your taxes. But whenever money is being sent to citizens, criminals are gearing up to steal it.