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Student loan payments will resume in October after a more than three-year hiatus — and fraudsters are trying to take advantage, the Federal Trade Commission warned.

Scammers may try to mislead borrowers by offering help and asking them to pay, Ari Lazarus, consumer education specialist at the FTC, wrote in a consumer alert Thursday. These fake offers may include lowering borrowers’ monthly payments, avoiding repayments, or forgiving their loans.

“Are you worried about repaying your loans? The calls and text messages offering ‘help’ may be tempting,” the warning says. “But before you act, you should know how to spot the scams.”

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The suspension of federal student loan payments began in March 2020, one of many tranches of federal aid intended to ease financial pressures on households at the start of the Covid-19 pandemic.

Since then, the pause has been extended eight times, twice by the Trump administration and six times by the Biden administration. Interest on federal student debt was also suspended during this period, but began accruing again on September 1st.

The “best source of information” about federal student loans is the Federal Student Aid website, studentaid.gov, the FTC said.

The agency offered two tips to avoid becoming a victim of a scam:

  • Do not share your FSA ID credentials. Only scammers will ask for it. They can cut off contact between borrowers and their loan servicer and potentially even steal their identity.
  • Don’t trust people who promise debt relief or loan forgiveness, even if they claim to be from the U.S. Department of Education. There is no special access to repayment plans or forgiveness options. Instead, log into your student loan account to review your options.

Source : www.cnbc.com

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