Reports of student loan scammers are on the rise; here’s what to look for

(WXYZ) — Student loans have been a topic of conversation lately, between talk of blanket student debt forgiveness and President Joe Biden extending the student loan hiatus until August 31.

Unfortunately, this may attract the attention of scammers

One person targeted by scammers was Nicole Phillips of Madison Heights. The single mother of two has been juggling student loans for 12 years. Since the pandemic, it has been inundated with consolidation offers it deems bogus.

“I get calls. I get texts constantly, at least 3-4 times a day,” Phillips said.

Mary Jo Terry, managing partner at Yrefy, a company that refinances delinquent student loans, said one of her clients received 43 calls.

“The caller ID appeared as a loan forgiveness. They had spoofed the 800 number of a major lender. So it appeared as a lender, whose usual name I won’t mention. And they finally picked up the phone and it was, “Give me $399 and I’ll get your student loan completely forgiven,” Terry said.

She advises anyone with a federal student loan to know your student loan officer. This is the company the Department of Education appoints to handle billing and other services related to the loan at no cost to you.

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Second, she said to be aware of loan consolidation companies.

They say, “Hey, just give me some money, and I’ll cut your payments down to $25 a month. Under the federal loan program, you can participate in income-driven repayment programs as well as completely free repayment programs,” Terry said.

Third, do not give personal information over the phone. If a caller asks, that’s a huge red flag. Your federal loan officer already has your personal information.

If you think you’ve been scammed, file a complaint with your loan officer. Also, go to Experian, Equifax and Transunion and put a fraud alert on your account.

Generally speaking, most people are eligible to consolidate federal student loans after they graduate, leave school, or fall below halftime.

There are pros and cons to consider, the Federal Student Aid website walks you through it all.

The bottom line is never pay an outside company to help you with your federal student loans. Your loan manager will help you for free.

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