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Problem Solvers: Federal student loan scams rise as payments look to resume

Posted at 5:20 PM, Jun 06, 2023

Headlines tell us those with federal student loans will soon have to start repaying them again after they were paused during the pandemic.

Now that a federal spending bill has been signed into law, students will start their repayment plan in August.

But beware.

Now that college students will soon have to start repaying their federal loans … loans totaling a whopping $1.6 trillion dollars… scammers are ready to pounce.

Shelby, a parent from Tulsa tells us, “My daughter got a phone call that said they could cut what she owed by thousands of dollars, through a special program announced by the government. They just needed her loan and payment information. I was able to intervene before she gave out that information. Is this most likely a scam?”

“There are some scams out there leading up to this.”

We asked certified financial planner Matthew Frankel about schemes just like the one Shelby told us about.
“You know, pay your student loans down in half the time, or here’s an extra $20,000 in extra student loan relief right now.”

Frankel’s with the Motley Fool, a popular money website.

He says whenever a lot of money’s involved, scammers harvest from a fertile field of potential victims…especially since they haven’t dealt with repayment for three years.

Remember that $1.6 trillion of student loan debt out there that eventually needs to be repaid?

“Any time there’s a large and unfamiliar influx or outflow of money from American’s pockets, it creates an opportunity for scammers. Think of when the stimulus checks were coming out, how many scams there were at that time.”

To help folks like Shelby steer clear of scams, experts say the official federal student loan can tell you exactly what the legitimate repayment plans are, such as income-based repayments or pay as you earn.

Information from the website can keep you from getting caught up in trying to figure out what's real, and what is a scam.

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