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With the Biden administration’s announcement to cancel up to $20,000 in federal student loan debt for low- to middle-income borrowers, many consumers see a chance to gain some financial ground. Unfortunately, scammers have recognized the same opportunity.
Student loan forgiveness scams have already seen an uptick since the announcement was made. Here are the signs to watch for and how to keep your personal information safe.
How to Avoid Student Loan Forgiveness Scams
Don’t Pay Fees—Forgiveness Is Free
One of the most prolific student loan scams is a company saying that you must pay to be eligible for student loan forgiveness. Scammers may even say they can get your entire student loan balance forgiven, even if it’s more than the amount that President Biden announced.
It’s always free to apply for federal loan forgiveness programs, and paying a fee will not expedite the process or increase your chances of approval. If a company promises to fast-track your application in exchange for a fee, they’re trying to scam you.
“Usually, they will approach you with something that sounds too good to be true,” said internet security and fraud expert Adam Levin, host of the podcast What the Hack with Adam Levin. “It’s anything to get you to act impulsively and provide money or provide…
