Student Loan Debt Deadlines and Scam Awareness

Be on the lookout for scammers to take advantage of upcoming student loan debt dates.

In July, the Department of Education completed changes to the Public Student Loan Forgiveness (PSLF) program. Student loan debt holders who have applied for PSLF may now find their PSLF information at StudentAid.gov. The pause on new PSLF applications while this transition occurred has now ended – so qualifying federal student loan debt borrowers are free to apply.

Until September 30, borrowers in default on their federal student loans can use the Fresh Start program to return to good standing. Sign up for Fresh Start by logging into your account at MyEdDebt.ed.gov.

While borrowers navigate these programs and changes, they should also know how to identify a student loan debt scam. Red flags include:

· Requests for upfront fees. If a company charges you upfront to reduce your debt, it is likely a scam. These types of fees are prohibited for loan service providers. You might not get any real help, or any money back if you’ve been taken advantage of.

· Promises of immediate loan forgiveness or cancellation. Before they even know the details of your situation, scammers might claim they can quickly eliminate your debt. They may reference real programs that few people qualify for or claim they can “dispute” loans to wipe them out.

· Requests for your Federal Student Aid (FSA) ID. Some scammers claim they need your FSA ID to help you – but do not share it with anyone. The FSA ID has the same legal status as a signature, and someone with your FSA ID could access your account and take control of your personal information without your knowledge.

Limited time offers. To get you to act fast, scammers will use a sense of urgency by saying you could miss qualifying for a repayment plan, loan consolidation, or forgiveness program if you do not act immediately. Don’t be pressured to act – take your time and thoroughly research claims before taking any action.

· Requests to sign a third-party authorization form or a power of attorney. These written agreements give a company legal permission to make decisions with your federal loan servicer on your behalf. Scammers use this to change your contact and payment information without your knowledge, stealing your money and possibly causing you to default on your loans.

· Claims that the program has a special relationship with the government or Department of Education. Scammers use official-looking names, seals, and logos, and tell you they have special access to certain repayment plans, new federal loan consolidations, or forgiveness programs. They do not. If you have federal loans, go directly to StudentAid.gov.