INDIANAPOLIS — The Better Business Bureau expects to see student loan scams continue to rise as the federal government extends its pandemic forbearance policies.
In a recent voicemail left for the CBS4 Problem Solvers’ Jill Glavan, you can hear how the student loan scams work.
“This is (redacted) with the student loan processing department,” the recording said. “I’m following up because there’s a lot happening right now with the new year and new President and since you haven’t completed your student loan forgiveness application with us, we really need to finish it now.”
She never started a student loan forgiveness application and would not have qualified for forgiveness.
According to BBB of central Indiana CEO Tim Mansicalo, the scammers hone in on the idea of forgiveness or cancellation of student debt.
“The scammers are playing off of that. They’re saying, ‘Hey, I can get you this great deal,'” Maniscalo said.
Federal loans have been in forbearance since March, meaning zero interest and zero minimum payments. President Joe Biden recently extended the forbearance until at least September. It’s supposed to help borrowers who are struggling to pay bills, but scammers saw an opportunity.
“They ask you to pay a little bit upfront, like $400 or $500 upfront, and then they’re going to ask you for your (personal) information,” Maniscalo said.
“There is a desire for anybody that has student loans to … want to get rid of (it) as fast as humanly possible,” said Indiana University Executive Director of Financial Wellness and Education Phil Schuman.
Schuman stressed that while there are some ways to have your student loan debt forgiven or canceled, they are limited and take years and lots of paperwork to qualify.
“It’s more than likely not going to be the case that there’s going to be some magic ticket … that’s going to let you get rid of it fast,” Schuman said.
That means you should not believe anyone who contacts you out of the blue with a “deal” and never give out your personal information over the phone.
Mansicalo suggested visiting studentaid.gov or reaching out directly to your lender if you’re looking for options to pay your loans.
“There (are) places that will help you free of charge,” Maniscalo said.