Some students who were seeking debt relief ended up being lured into a sneaky scam. Recently, the Consumer Financial Protection Bureau took action against two student debt relief scams that duped borrowers into paying upfront fees for federal loan benefits.
The CFPB entered a joint filing with the Florida attorney general to stop student debt relief company College Education Services. The bureau also filed a lawsuit against Student Loan Processing.US for unlawfully advertising student debt relief services.
Student loan borrowers are being urged to exercise caution when it comes to paying high fees for free federal loan benefits.
“Student loans are already a significant debt for many Americans. College Education Services and Student Loan Processing.US added to that hardship by taking advantage of troubled borrowers and failing to describe their services honestly,†said CFPB Director Richard Cordray in a statement. “When scam artists prey on student loan borrowers, we will take action to halt their illegal activity.â€
If you need help repaying your student loans, the U.S. Department of Education has several plans to assist with relieving the burden. Among them are income-based repayment and graduated payment plans. If you’re experiencing trouble with a company offering debt relief services you can file a complaint.
See the CFPB’s full report here.