It’s a terrible feeling – that sinking feeling in your stomach. I think I was just betrayed. You have tried to fix your student loan problems and now you fear that you are one of the many borrowers who have fallen victim to a scam.
If there is good news in this situation, it is the fact that hope is not lost.
There are steps borrowers can take to get their money back. There are also steps borrowers can take to end the fraud and keep others safe.
Do not be ashamed
Before going into the details of how to deal with student loan fraud, I think it’s important to address a common sentiment among borrowers: shame.
You don’t deserve this to happen. We live in a constantly evolving world – technological changes. The rules for student loans are changing. It’s easy to get overwhelmed.
Student loan scammers chase down confused borrowers.
The same scammers hope that their victims will be too embarrassed to get their money back. Don’t let them win.
Checking if a student loan service is a scam
Sometimes it is not apparent whether a student loan company is legitimate or not.
In many cases, a simple Google search of the company in question will provide a definitive answer.
For more in-depth resources on potential fraud assessment, visit the Attorney General of Texas and the Minnesota Attorney General’s website. Consumer protection is one of the duties of a Attorney General.
In my opinion, this Federal Trade Commission (FTC) graphic is one of the best. It’s simple and straightforward, but does a great job of identifying major red flags.
If you are unsure whether you have been scammed or not, be sure to check out our comprehensive article on How to Detect and Avoid Student Loan Scams.
Immediate Steps to Fix the Chaos Created by a Student Loan Scam
In most cases there are no fixed deadlines. However, the sooner you can respond to a scam, the better.
Call your student loan service provider. They can notify you of any recent requests made on your behalf. You can also help the borrowers get things back to normal.
Change your passwords. Start by changing your FSA ID password. To be extra secure, you may want to change your student loan passwords and even your email password.
Talk to your bank or credit card company. If you have a bill payment or an automatic charge, turn it off. Your financial institution may have additional security recommendations. Better still, they may be able to stop making payments to the scammer. If you paid by credit card, you will dispute all charges.
Keep detailed records. Save all the email conversations you have. Write down what you can remember from all phone interactions. Use your call log to trigger your memory. These records can help get your money back, and they can also help shut down the scammer.
How you can help yourself and others
One of the best things to do in this situation is to alert the relevant authorities. Government agencies may move slowly at times, but they have effective resources in place to deter fraud and to help borrowers clean up the mess caused by student loan fraud.
First, you’ll need to call or file a complaint with the attorney general in your state. You can also report fraud to the FTC.
These complaints can also be useful in dealing with your bank or credit card company and in dispensing with fees. Keep copies of your complaints with the other records you keep.
Facebook posts and negative reviews also help, but are less critical. Social media and online comments don’t shut down scammers, but this information helps other borrowers avoid mistakes.