Don't Fall For Online Financial Aid Scams

Category: Education

For students looking to find grants, loans, scholarships, and other forms of financial aid, there are many resources available online. Unfortunately, some of them are scams. Here is what you need to know in order to avoid losing money in a financial aid scam, or even having your identity stolen...

Reliable Sources of Student Financial Aid

Looking for scam-free sources of financial aid for a college bound student? Start with FAFSA. The Free Application for Federal Student Aid (notice the word "free"?) is an online application form that every prospective college student should complete. It is offered by the U.S. Department of Education's Student Financial Aid Office, which matches millions of students per year with Pell grants, Stafford loans, scholarships, and other forms of financial aid.

The FAFSA asks over 130 questions about the student and family to determine the programs for which a student is eligible and the amounts of money that can be obtained. The FAFSA can be pretty daunting, and that is where scammers take advantage of families.

You don't need to pay up to $1,000 for advice on how to fill out the FASFA. The online form itself contains lots of advice. There are guides you can download. You can even chat with a free government employee advisor online, call a toll-free number, or get help from a local school guidance officer.
Financial Aid Scams

Some scammers promise to hook you up with "hidden" sources of financial aid in exchange for up-front fees. Often additional "processing" fees are demanded as they supposedly uncover alleged scholarships or grants. Many families pay the fees only to be told that, in the final analysis, the student did not "qualify" for the aid. Besides taking your money, scammers also get a ton of personal financial information that easily enables identity theft. Legitimate financial aid advisors almost never ask for credit card or bank account numbers.

More Online Financial Aid Resources

One exception is The College Board, a legitimate service which helps connect students with non-federal financial aid. It requires a CSS (College Scholarship Service) profile, which can be completed online. CSS charges a fee of $9 to 16. But you should know that only about 250 colleges and universities require a CSS profile. Before completing the complex CSS profile, check to see if any of the colleges in which you are interested require it.

Sallie Mae is a publicly held corporation that originates, services, and collects student loans on behalf of private sector lenders. Originally a federally sponsored organization, Sallie Mae remains the largest originator of federally insured students loans.

FinAid.org is a free and easy-to-use guide to the complicated world of student financial aid. It's a good place to start if you don't know a Pell grant from a Perkins loan. Its online resources include guides to military aid (from ROTC to the GI Bill), prepaid tuition programs, private school scholarships, and other financial aid.

Your State's department of education is another good source of financial aid information for in-state and out-of-state students. Many employers offer financial aid to employees and their children; information about these programs is often found online. Colleges and universities also provide financial aid information online. Check the college website, or contact their financial aid office directly to see if there are any grants or scholarships specific to the college, and how to apply.

Have you found a great online resource for student financial aid? Post your comment or question below...

 
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Most recent comments on "Don't Fall For Online Financial Aid Scams"

Posted by:

Lyle
28 Jul 2011

Any government guaranteed student loan is a scam! If you should default you will have years of anguish trying to get out of default. Don't think for one second that you never default. Look at the economy today. It has been in the dumpster before and will be again. If you consolidate the loan to get out of default they will include all the collection fees that have accumulated.

Sallie Mae is not a government agency. It is a privately held company making huge profits at the expense of students.

They will move the account between collection agencies and each one will add an obscene collection fee. They don't want you to get it paid off. They want to cook their books by adding fictitious collection fees.

Mortgage your home, sell the home, sell the car, pay off your credit cards. Pay for you education out of your pocket.

WHATEVER YOU DO, DO NOT TAKE A STUDENT LOAN!


Posted by:

William
28 Jul 2011

SO true about Federal Student loans! You almost have to die in order to be set clear of the obligations and collection agencies. Also, Wells Fargo recently sold all of the account business to ACS. Now you are dealing with a larger company that is attempting to get their arms around each of the accounts and smooth out the payment process. Additionally, the collection agency handling some of the late paying accounts has changed.

Just try not to left the loan go if you can't pay. Contact the lender, have documentation why = hospital is about the only legitimate excuse that works.

As stated elsewhere on thses comments: If you can get a school loan elsewhere do it. Betting on finding a job after one graduates is pretty shaky. THat darn loan is still following your around.


Posted by:

Philip
29 Jul 2011

Wow, thanks for the info!!

I just applied (and was approved) for a ton of student loans, now I'm thinking I better do some research!!


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