Student Loan Forgiveness Scams: Red Flags and Free Help

TL;DR: Anyone who asks for an upfront fee, promises guaranteed or fast student loan forgiveness, or wants your FSA ID is likely a scammer. The FTC has shut down operations that pretended to be the Department of Education and collected millions in illegal advance fees. Help with federal student loans is free at StudentAid.gov and from your loan servicer, whatever the current forgiveness or repayment program is.

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When student loan news breaks, robocalls and texts follow within hours. The FTC has said scammers "take advantage of confusion around big news", as the Los Alamos Daily Post reported, and offers to "help" can feel tempting when repayment is worrying you.

What the scams look like in real cases

In August 2023 the FTC stopped operations that it said collected about $8.8 million in illegal advance fees, pretended to be affiliated with the US Department of Education, promised lower or eliminated payments under "Biden Loan Forgiveness", and convinced students to stop speaking to their loan servicers, in an FTC press release.
In May 2023 the FTC went to court against two schemes that impersonated the Department of Education, and one that used fake COVID-19 relief programs, said to have taken more than $12 million combined, per an FTC consumer alert.

Red flags

An upfront fee. NPR reported the FTC's position that it is illegal for student debt relief companies to charge before providing a service.
A guarantee. Anyone who guarantees forgiveness, or promises it faster than the Department's own timeline, is a scammer.
Official-looking seals and logos. The FTC says scammers use official-looking names, seals and logos, so appearance proves nothing.
A request for your FSA ID. Neither the Department of Education nor its affiliates ask for your StudentAid.gov credentials, according to the Saturday Evening Post. With it, a scammer can sign documents and change your account.
A demand to stop talking to your servicer or to pay a "processing fee" to a third party.
Pressure to decide today.

Where the free help is

Federal loan help costs nothing. Log in at StudentAid.gov to see who your servicer is, check your contact details and compare repayment options. If your loans are private, go directly to your loan servicer. The official details of any forgiveness or repayment program are published there; treat anything different from another source with suspicion.

If you paid or shared your FSA ID

Change your FSA ID password and turn on two-step verification.
Contact your servicer and check that your contact details, repayment plan and payments have not been changed.
Dispute any charges with your bank or card issuer.
Report the company to the FTC.
Consider a credit freeze if you shared ID numbers; see re-securing your identity after a scam.

"Recovery" and "relief" pitches follow the same script as the fake FTC refund recovery scam, and losses can be reported using the steps in I just got scammed in the US. If you paid by gift card, read gift card scam recovery. International students should also read digital footprint for international students, and whether identity theft protection is worth it if your details were exposed.

FAQs

Do I have to pay to get student loan forgiveness or help?

No. Help with federal student loans is free at StudentAid.gov and from your loan servicer. NPR reported that the FTC says it is illegal for student debt relief companies to charge before providing a service.

Will the Department of Education ask me for my FSA ID?

No. The Department of Education and its affiliates do not ask for your StudentAid.gov credentials. Anyone who does, including someone offering to help, is a scammer.

How can I tell if a student loan company is legitimate?

Be suspicious of upfront fees, guarantees, seals and logos, pressure and requests for your FSA ID. Verify options on StudentAid.gov, which is the official .gov site, or contact your servicer directly.

I paid a debt relief company. What now?

Change your FSA ID password, check your servicer account for changes, dispute the charge with your bank or card issuer, and report the company to the FTC.

Where can I report a student loan scam?

Report it to the FTC at ReportFraud.ftc.gov. You can also tell your loan servicer so it can watch your account.

Student loan scammers use phone numbers and emails from leaks, so see what is public about yours with the free digital footprint checker.

Curious what's already out there? Scan My Shadow checks a phone number and email across 1,500+ sources and sends a clear report — no guesswork, just facts. Start your scan.

Student Loan Forgiveness and Debt Relief Scams: How to Avoid Them