Why Do I Keep Getting Calls About Student Loans?
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If you’re a student loan borrower, you’re probably used to receiving phone calls, letters, emails, and text messages about your student loan debt. While some of these are legitimate messages from federal loan servicers, many are scams. If you're getting calls about student loans and you don't have any loans, that's a good sign it's a scam. Below, we go into detail on how to spot/prevent a scam. Bottom line? If it seems too good to be true, it's most likely a scam.
Written by the Upsolve Team. Legally reviewed by Attorney Andrea Wimmer
Updated September 6, 2023
The amount of student loan debt in the U.S. is staggering. Borrowers in the U.S. currently owe $1.75 trillion in student loan debt according to the Federal Reserve. If you’re having trouble making your student loan payments, you’re not alone.
If you have unpaid student loans, you may be contacted by a loan servicer. It’s important to know how to tell if a call you’re getting is legitimate or not. This article explains why you may be getting calls about your student loans, how to tell if the call is legit, and what red flags that may indicate the call is from a scammer.
Are Calls About Your Student Loans Legit?
If you're behind on your payments, you may receive legitimate calls about your student loans, usually from your loan servicer or lender. But don’t assume that a call is legitimate simply because you’re behind on your loans.
Sadly, student loan borrowers who are having trouble paying off their loans are often targeted by scammers. Scammers may promise student loan forgiveness or to reduce your overall loan debt, but first they’ll get your personal information and collect an upfront fee.
Remember: You don’t usually have to pay to get help managing your student loan debt. Many debt relief companies will charge a fee when providing services but you can manage your loans on your own for free by contacting your loan servicer. At no cost, the U.S. Department of Education and federal loan servicers can help you find relief from burdensome student loan payments.
Tips for Spotting Student Loan Scams
How do you know if a phone call is legit or not? There are some common false claims and red flags to watch out for. Also, if something seems too good to be true, it probably is!
You want to listen to what the caller promises as well as what they ask of you. Both can help you determine if the person contacting you is legitimate or if it is a debt relief scam.
Common Red Flags in Student Loan Calls
The caller requires you to pay monthly or up-front fees for student loan debt relief assistance.
It’s illegal to charge an up-front fee for this type of debt relief service. You should avoid working with any company that requires you to pay a fee before it performs any service, especially if it tries to get your credit card number or bank account information. Some even are bold enough to ask you to pay them directly, promising to pay your servicer each month on the due date.
This type of scam shouldn’t be confused with accredited, nonprofit debt management programs. These types of services pay your lenders directly as part of broader, legitimate debt management plans.
The caller claims that the debt relief offer is limited and encourages immediate action.
Student loan debt relief companies instill a sense of urgency in vulnerable borrowers to persuade them to act quickly. They cite new laws and programs that are replacing better but soon-to-be-discontinued programs as a method of encouraging immediate action.
The caller promises immediate and absolute loan forgiveness or debt cancellation.
There is no public or private entity that can legitimately claim that it can deliver loan forgiveness or cancellation immediately without delay. Most federal student loan government forgiveness programs require many years of qualifying payments and/or employment requirements before your loans will be forgiven.
Payment amounts under income-driven payment plans are determined by federal law. This means that student loan debt relief companies have no special ability to get you a good deal that reduces or eliminates your student loan debt.
The caller asks for your FSA ID username and password.
Student loan borrowers use an FSA (Federal Student Aid) ID to sign legally binding documents electronically, as well as to log in to StudentAid.gov to access their FAFSA account. Do not give your FSA ID password to anyone or allow anyone to create an FSA ID for you.
The Department of Education and its partners will never ask you for your FSA ID password. Anyone with access to your FSA ID information can make changes to your account without your knowledge or permission.
The caller asks you to sign and submit a power of attorney or a third-party authorization form.
These are written agreements that give a third party the legal authority to act on your behalf. If you sign one of these, the authorized party can speak directly with your student loan servicer and make decisions that affect your account. They can also access sensitive information like your Social Security number.
Debt relief companies can change information related to your account to conceal the fact that they aren’t making your monthly student loan payment. If the debt relief company collects money from you but never makes any payments on your student loans, you’ll still be responsible for any outstanding payments, interest, and late fees. Missed payments can hurt your credit score and stay on your credit report for years.
By signing a power of attorney, you’re giving a debt relief company the authority to make important decisions on your behalf. You can contact your loan servicer to revoke any power of attorney or third-party authorization agreement that the servicer has in its file.
You can also contact your bank or credit card company and stop payments to the student loan debt relief company. Finally, you can file a complaint with the Federal Trade Commission (FTC) or your state attorney general.
Look Out for False Claims & Misrepresentation
Student loan relief scammers often make similar false claims. You may get a letter, text, email, or phone message that includes one of the following messages:
“Act immediately to qualify for student loan forgiveness before the program is discontinued.”
“You are now eligible to receive benefits from a recent law that has passed regarding federal student loans, including total forgiveness in some circumstances. Federal student loan programs may change. Please call within 30 days of receiving this notice.”
“Your student loans may qualify for complete discharge. Enrollments are first come, first served.”
“Student alerts: Your student loan is flagged for forgiveness pending verification. Call now!”
Also, some student loan debt relief companies pose as entities related to the government, which is illegal. The Federal Trade Commission (FTC) has taken action against many of these companies. Some are banned from providing debt relief for life.
What Do I Do if I Think I’ve Been Scammed?
If you think you have already been scammed, reach out to the Consumer Financial Protection Bureau as soon as possible to report fraud. If you’ve already shared your personal information or paid a fee to a student loan debt relief company, one best practice is to change your FSA ID immediately.
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How To Get on the “Do Not Call” List
If you’re receiving unwanted, unwarranted phone calls, consider putting your number on the National Do Not Call Registry. The registry was set up by the Federal Trade Commission (FTC) to stop telemarketing sales calls. But you may still receive calls from scammers and robocallers, so continue to be cautious about which calls you take seriously.
If you’ve already received a spam call for what you think is a scam and don't want a callback, report it to the FTC using the Federal Communication Commission’s online form.
You also have rights under the Telephone Consumer Protection Act (TCPA). Telemarketers, including those working for lenders and loan servicers, must ask for your permission before robocalling you and include an opt-out or unsubscribe option during each robocall.
How To Get Help Paying Your Student Loan Debt
If you need help with student loan debt relief, remember that you can contact your loan servicer at any time. You may be eligible for a federal student loan repayment program that can help you manage your loan payments successfully. There are also other options, depending on your goals.
Apply for Forbearance or Deferment
If you just need a temporary break from paying your loans, you can apply for a forbearance or deferment. These programs allow you to temporarily stop making payments on your federal student loan. While this can provide some temporary relief, keep in mind that you won’t be making any progress toward forgiveness or paying back your loan.
Ask To Change To an Income-Driven Repayment Plans
When you begin student loan repayment, you’re automatically placed on a standard repayment plan. Under this plan, you make equal monthly payments for 10 years. Borrowers who stick with the standard plan pay less in interest in the long run and pay off their loans faster than borrowers on other federal repayment plans. But the monthly payments tend to be high, and not everyone can afford to stay on this plan.
If you want to lower your payment amount, the federal government offers four income-driven repayment plans for federal student loans:
Income-based repayment (IBR)
Income-contingent repayment (ICR)
Pay As You Earn (PAYE)
Saving on a Valuable Education (SAVE)
Formerly Revised Pay as You Earn (REPAYE)
These options are best if your income is too low to afford a standard payment.
Although you may select or be assigned a repayment plan when you first begin repaying your student loan, you can change repayment plans at any time — for free. Contact your loan servicer if you would like to discuss repayment plan options or change your repayment plan.
Consider Consolidating Your Student Loans
You may want to consider loan consolidation if you have more than one student loan. This process can make things easier because you roll all your loans into one account. This means you only have to make one payment each month. You may also be able to get a better interest rate by consolidating your loans.
See if You Qualify for Any Student Loan Forgiveness Programs
There are legitimate student loan forgiveness programs for federal student loans. Public Service Loan Forgiveness (PSLF) is a federal program available to government and certain nonprofit employees. If you’re eligible, your remaining loan balance could be forgiven tax-free after you make 120 qualifying loan payments.
This program is not available for those who have private loans. If you’re offered a PSLF for your private loan, you’re likely dealing with one of the student loan forgiveness scams that have been plaguing borrowers.
Consider Filing Bankruptcy if You're Drowning in Debt
You may be eligible to discharge your student loans through bankruptcy. To qualify, you need to prove that repaying your loans has been and will continue to cause you “undue hardship.”
The Department of Justice has recently provided much clearer guidance on what “undue hardship” means. Read our article Yes, You Can File Bankruptcy on Student Loans to learn more.
You can also check your eligibility using our free student loan discharge screener to see if Upsolve can help you get rid of your student loans through Chapter 7 bankruptcy. If you want to talk about your options with a bankruptcy attorney, we can refer you to one for a free consultation.
