Unfortunately, there are many scammers out there looking to take advantage of people in order to make a quick buck. If you have student loans, the payments can be costly and it may be tempting to accept an offer of help from a company who promises to lower your payments or have your debt forgiven altogether. However, if that company requires any sort of upfront payment or charges you monthly fees, you can rest assured that it is not a legitimate company.
Because these types of scams are so common, the Federal Trade Commission has been working to crack down on these fraudulent companies, according to Credit.com. One common scam involves a company contacting you to tell you that you qualify to have the amount of your monthly payments lowered. You then pay the company each month only to find out that none of the payments you are submitted are being used to pay off your loan.
Another common scenario involves companies who promise loan reduction or forgiveness but require an up-front fee to be paid, or they require that you pay them a monthly fee or service charge. Some companies may also indicate that they are affiliated in some way with the government when they actually are not.
While programs do exist that will forgive certain kinds of student debt or reduce loan amounts, they often have stringent requirements and chances are you may not qualify. There are legitimate ways to reduce your monthly payments based on how much income you earn. However, those programs will always be free if they are genuine and will never ask you to pay any fees.