ProgramsAndDegrees

Beware of Financial Aid Fraud!

 

Gaining financial aid so that you can pursue your studies is a dream come true. But this can quickly turn into a nightmare situation if the financial monetary aid is a fraudulent. Here is how to prevent yourself from becoming a target.

With the rise of online studies and institutions, there has been an increase in fraudulent financial aid. You don’t want to be a victim of fraud rings that steal your money or dash your hopes of clinching that degree so make sure you arm yourself with these fraud-fighting tips:

1. Warning Bells Should Ring if You Are Rushed

Those ‘buy now’ and ‘don’t miss this opportunity’ tactics can be used to put pressure on you but avoid the temptation. Often, what comes next is for these companies to request your banking account or credit card details, which you should never give out as it could be putting you at risk of identity theft.

2. Don’t Pay to File Your FAFSA Document

Some websites offer you help to file your Free Application for Federal Student Aid (FAFSA) but request that you pay them a fee. Don’t do it as these sites are not endorsed by the U.S. Department of Education. The official FAFSA site can be viewed at www.fafsa.gov where you can actually gain help at no cost.

3. Stay Safe Online

When filling out the FAFSA documents online, once you are done you should exit the application and close the internet browser. Cookies will be deleted automatically once you leave, so even if you are working on a public computer your information will be safe. Never give anyone your Federal Student Aid Pin, even if the person is your friend or seems nice enough to help you fill out the FAFSA.

4. Avoid Loans that Request an Upfront Fee

You should never have to pay an upfront fee before gaining a student loan because this is a scam trademark. Also be wary of words such as 'application fee', 'processing fee' or 'insurance fee' that signal fraud. An authentic and lawful education loan will never demand an upfront fee when you submit your application.

5. If Everyone is Eligible, it Could Be a Bad Sign

If you are desperate for a student loan, you might not think that a lender offering loans to anyone and everyone should be a cause for concern - but it is. There are always going to be certain criteria required for scholarships to be granted, whether those restrictions relate to athletic ability or academic merit. If a scholarship sponsor is giving out loans easily, then this could signal a scam operation.

6. Avoid Cutting Corners

You might be told that the lender will send your application on your behalf or do other things for you, but this is never a good thing. When dealing with lawful loans, you will have to do everything yourself. Other scam shortcuts can include statements that you will gain immediate confirmation or that your application is guaranteed.

7. Check Company Listings

Before you proceed with an organization, always check that they are properly listed. Call Directory Assistance to check listings by dialing 1 followed by the area code and 555-1212. Listings can also be shown online by using the 555-1212.com website.

8. Get Everything in Writing

You should get every correspondence and offer in writing before you respond to them. This information should include refund and cancellation policies, as well as guarantees. Always read the fine print and never merely trust what is said.

You might think loan frauds cannot happen to you because you are careful, but never underestimate how sneaky certain individuals or fraud rings can be. When you are in dire need of financial aid, dazzling offers can get you wrapped up into thinking you have had a lucky break, with the result that you fall into a trap. Always be critical and objective about everything and make sure institutions are valid before you hand over your hard-earned money.

 

photo credit: LendingMemo via photopin cc

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