Student loan scam alert

Better Business Bureau issues alert

Millions of Americans are trying to pay off student loans. Currently, student loans are only second to home mortgages for debt in the United States. Many of you might be tempted by the promise of a quick fix, if someone offered to erase that debt.

However, proceed with extreme caution.

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The Better Business Bureau in Southfield has issued an alert about student loan scammers. It says the scheme starts with an offer you receive via email or you notice a post on social media that claims a company can erase your student loan debt. Many claim that their service is made possible by a new government program or policy.

The company asks for an upfront fee to negotiate with your student loan lender on your behalf. They will claim they've helped numerous other clients, but don't believe them! Student loans can only be forgiven under specific circumstances, and it's not fast or easy. These scammers will take your fee and disappear.

In another version of the student loan scam, con artists claim that they can save you money by consolidating your loans. Some charge a fee for using a free government service. Others may actually move your loans to a private lender with a higher interest rate.

The Better Business Bureau offers this advice for spotting a scam and how to avoid falling victim.

*Never pay upfront. Real lenders will take a percentage once their service is complete. You don't need to pay an upfront fee beforehand.
*Know your options. If you are having trouble paying your student loans, contact your lender directly. You should research programs offered by the federal governments of the US and Canada.
*Never give a 3rd party power of attorney. Don't sign anything giving a company the power to negotiate on your behalf. A scam company can use this to take control over your loans.

Finally, always remember if it seems too good to be true, it probably is! Any company that claims it can erase your student loan debt in minutes is lying. Don't bother responding to the ad or email. It's always better to ignore these offers and find a legitimate way to tackle your loans. Responding to the email or calling the company may only encourage scammers to contact you again.

You can contact the Better Business Bureau at 248-223-9400 or follow this link.


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