NASHVILLE, Tenn. – Student loan debt forgiveness is a hot topic these days and predatory companies are doing their best to cash in on it.
These companies call, email and post ads on social media looking for distressed borrowers who will believe the too good to be true claims. Some companies promise thousands of dollars in savings and claim they have special expertise or relationships with the Department of Education.
Student Loan Forgiveness Club (phone: 1-844-766-3462 | website: studentloanforgiveness.club) posts ads on social media targeting specific post secondary school borrowers. Students responding to the ads are immediately contacted after entering their contact information on the website. The company asks students for $600 up front or 3 payments of $200 to start the process.
BBB’s investigation determined www.studentloanforgiveness.club is using WhoisGuard, a company out of Panama, to hide domain registration information. BBB also found the website and Facebook pages for the company were created in January 2016.
Further investigation by BBB determined Jason Spencer, associated with the Student Loan Forgiveness Club is also identified in BBB records as CEO of Student Loan Relief. According to BBB Dallas Texas, Student Relief failed to respond to 26 complaints, most alleging the company collected fees from consumers and failed to provide services, failed to cancel services and failed to provide requested refunds resulting in an F Rating with BBB Dallas.
How to AVOID a Student Loan Scam
• 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 can research programs offered by the federal government.
• 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.
• If it seems too good to be true… It probably is. Any company that claims it can erase your student loan debt in minutes isn’t being truthful. Don’t bother responding to the ad or email.
According to the U.S. Department of Education, if you took out federal student loans to pay for college you never have to pay to get help managing your student loan debt; the Department of Education offers assistance for free. The Consumer Financial Protection Bureau states paying a student loan relief company money to relieve debt is not the best choice because:
• Enrollment in alternative repayment programs, like Income-Based Repayment (IBR), is available at no cost to federal student loan borrowers.
• Debt relief companies do not have the ability to negotiate with your creditors in order to obtain a “special deal” under these federal student loan programs. Payment levels under IBR and other federal income-driven repayment plans are set by federal law.
• Any claims by debt relief companies to the contrary may be misleading and potentially a violation of law.
For additional information about coping with student loan repayment problems, visit studentloanborrowerassistance.org, a helpful website resource in Spanish and English provided by the National Consumer Law Center.
Filed under: Business, Education Tagged With: better business bureau, debt forgiveness, student loan scam, student loans