For Immediate Release
June 1, 2016
Concord, NH — Consumers repaying federal student loans may be targeted by a growing number of companies using deceptive tactics to scam student loan borrowers into paying for assistance that is offered for free through the U.S. Department of Education and federal student loan servicers.
These scam “debt relief” companies, many of which are under investigation by the Federal Trade Commission (FTC) and state attorneys general, are offering to relieve borrowers of their student loan debt, by claiming to lowering the debt significantly or settling on a defaulted loan, both for a fee. Federal student loan borrowers should never pay for assistance in choosing a student loan repayment plan, applying for forbearance or deferment, or applying for loan consolidation or forgiveness. The U.S. Department of Education and federal student loan servicers provide free, comprehensive assistance to borrowers on managing the federal student loan repayment process, including repayment plan information and enrollment, deferment and forbearance options, loan consolidation, and loan forgiveness.
Student loan servicers are companies the government contracts with to manage federal student loans. Many scam debt relief companies pretend to be affiliated with the federal government through official–looking logos, names, or website addresses. Some may fraudulently use the U.S. Department of Education’s logo. In order to identify and avoid these scam companies, borrowers should understand which companies are servicing their federal student loans and work with them directly. Borrowers can identify their student loan servicers by utilizing the National Student Loan Data System.
For more information on federal student loan repayment plans and federal student loan consolidation, visit the U.S. Department of Education’s website at www.studentloans.gov.