Protect Yourself From These Common Texas Student Loan Scams

Not everyone plans to pursue higher education, but for those who do, financial aid often makes it possible. Speaking for myself, I wouldn't have been able to spend more than a semester in college without loan assistance.

What happens though when scammers seek to prey on unsuspecting college students who think they are receiving a legitimate loan only to find out that it was a scam all along?

Student Loan Scams in Texas

Unfortunately, student loan scams are a reality across Texas, and the Office of the Attorney General has some further info on common tactics that scammers use as well as some tips on how to avoid falling victim.

According to the Office of the Attorney General, the most common student loan scams involve loan consolidation—the process of combining multiple smaller loans into one larger loan.

One dead giveaway that you are encountering a scam is if the company charges money upfront to consolidate your federal student loans. This is often hidden under a fake title of 'processing fee.'

Another common tactic when it comes to student loan scams are debt relief scams. These are not always nefarious, but you should always proceed with caution if a company promises they can eliminate or reduce your student loan debt.

How to Spot and Prevent Student Loan Scams

The Office of the Texas AG provides some steps you can take to make sure you stay safe from falling victim to student loan scams. Always ask yourself if the company does the following:

• Do they make promises of immediate or quick debt forgiveness or cancellation by a certain deadline?
• Do they request upfront fees to apply for loan programs?
• Do they claim that the program is a part of the U.S. Department of Education even though there is no proof whatsoever of their affiliation?
• Do they request your FSA (Federal Student Aid) ID info?

If you encounter any of these true statements, then you can play it safe by reporting a likely scam to the Office of the Attorney General.