As student loan payments and debt collection return, Better Business Bureau® (BBB®) warns borrowers to be on the lookout for loan forgiveness and debt collection scams.
On May 5, the federal government resumed collection of defaulted federal student loan payments for the first time since March 2020. The change will impact over five million borrowers who are currently in default, and another four million may be at risk of default in the coming months. Affected borrowers will receive email notifications within the next two weeks encouraging them to consider repayment options.
If you’re looking for ways to repay your loans, BBB recommends researching carefully before signing up for any student loan relief services. Consumers have previously reported scams where unscrupulous companies or government impersonators make big promises to reduce debt, then run off with the borrower’s money or information.
“It’s not uncommon for scammers to take advantage of the confusion around a major policy change like this one,” said Michelle L. Corey, BBB St. Louis president and CEO. “A good rule of thumb is to be wary of anyone who makes big promises to reduce or eliminate your federal student loan debt for a fee.”
How do I find legit student loan relief?
Apply directly with the government. The federal government offers resources for repaying your loans. You can browse options and apply for loan deferments, forbearance, repayment, forgiveness and discharge programs at no cost and without needing a third party.
Research lenders. Check out companies at BBB.org before working with them to see complaints, reviews and whether they are BBB Accredited. The FTC also has useful guides to get real, trustworthy information about your student loans.
