Identifying Scams – Student Loans

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This topic contains 2 replies, has 3 voices, and was last updated by  nancy ann m 1 year, 5 months ago.

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  • #134891
    becky119
    Participant

    One issue that I have been running into a lot is dealing with people that call me up and tell me that they will make all my student loan problems go away. I’m sorry to say that I believed the first group that got in touch with me and ended up losing $600+ because I just didn’t know any better.

    Are there any companies out there that are legit? Ones that will actually help you pay down your student loans or get you on track for a forgiveness program? Or is my best bet to do the research through the companies I have loans with to attempt to get a lower interest rate or anything along those lines to lower the overall amount that I owe.

    Are there any tools out there that can help weed out the scam artists? At this point I just ask whomever calls to take me off their list. I could be missing out on actual help, but I just don’t trust anyone anymore.

    #135140
    Dan Schointuch
    Keymaster

    We’ve partnered with Debt.com to help match our readers with reputable businesses willing and able to help with their financial problems, including student loan debt, within our Solutions Center.

    You can fill out the form here to get started (there’s also a phone number you can call directly): https://www.moneytalksnews.com/solutions/student-loans/ The companies still employ the standard sales tactics (calling you and pitching their services), but they should all be legit. If you find one that isn’t through that page, let us know immediately.

    Another great resource is the website of the National Foundation for Credit Counseling, or NFCC, located here: https://www.nfcc.org. There you can find a reputable credit counseling organization who can help with most financial situations (they can help you do everything from build a budget to pay down debt). You can read about the standards they require of their members here: https://www.nfcc.org/about-us/why-work-with-an-nfcc-agency/accreditation-standards-of-excellence/

    #135356
    nancy ann m
    Participant

    Hi Becky & Dan,

    I hope you don’t mind if I interject here, but I have worked in the educational financial aid industry for over 30 years assisting and counseling students and parents on all aspects of student loans including borrowing, rights & responsibilities of the borrower, as well as affordable repayment.

    I would be extremely hesitant of working with any company that has solicited you to assist with lowering your interest rate and/or monthly payments. I would also like to add to Dan’s suggestions on websites for more information, to also go to StudentLoans.gov which is a federal website that has a wealth of information, including the ability to register on the website and you will be able to view the student loans you have and see several repayment options on your loans. This does not include private student loans you may have taken out, which generally run at a higher interest rate. You can only take advantage of the forgiveness program if you meet the criteria set by the federal govt. and through your loan servicer so long as you do not convert your loans to another type of loan. There are also other options for example, graduated repayment plans, as well as other repayment plans or if needed, deferment or forbearance if you are having a hardship situation. The other tip I would also offer, is if you have several student loans at various interest rates, be careful about consolidating (if you meet the consolidation criteria) your loans, as you may lose the interest rate on any student loans that you borrowed when the rates were lower. Combining loans may be a good option, which is a bit different than consolidation. The federal government resets the interest rate based on the annual Treasury note auction, whether fixed or variable rates every July 1st and has done so for as long as I can remember, so if you borrowed over a period of several years, you probably have different interest rates on each loan. There is a chart on what the interest rates have been historically as well as currently, which I can provide the link to if interested. Incidentally, the interest rates will be dropping slightly this July 1st, but that is only beneficial to new borrowers. I hope this is helpful!

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