Avoiding Student Loan Relief Scams

Don't fall for these scams that could make your student loan debt worse

Shaun Plum
MoneyTips Contributor

Borrowing Student Loans

Avoiding Student Loan Relief Scams
August 17, 2016

Graduates and students who have student loan debt may be tempted by adverts claiming to be able to lower their monthly student loan payments. Many of these adverts are likely to be scams, and most lenders offer the same type of relief without any extra costs.

These scams may seem attractive because they often claim to be connected to the federal government, or to be an initiative launched by the president. However, to take advantage of the relief these programs claim to offer, borrowers have to pay an enrollment fee, which can be as high as $600. Some programs do not have this upfront fee but instead demand a monthly fee, which can be as high as $50. The Department of Education warns borrowers not to trust any program that requires such a fee.

Help is available for those having difficulty paying their student loans. This help should always come from the student loan servicer, and borrowers should directly contact that company to discuss the options available.

Debt consolidation may be the best option for those who have several student loans. This will roll all the loans into one and average out the interest. While it may not save you a large amount of money in the long term, it could make monthly payments lower by giving you thirty years to pay off the loan. If you want to consolidate your debt, try the free Debt Optimizer by MoneyTips.

Find out quickly at what rate you can refinance your student loan.

Photo ŠiStockphoto.com/honglouwawa

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