Regrettably, there are a lot of scammers out there that try to profit from individuals who are going through the process of looking for student aid, applying for student aid, maintaining student aid, and repaying student loans.
There are also companies out there that aren’t exactly scammers, but they offer services that aren’t really necessary – especially not for a cash-strapped student on a tiny budget. You should for instance be able to fill out the FAFSA form without paying anyone to assist you. If you need help or have any questions about the form, there are federal, state and school resources available that will help you for free.
While in the process of applying for schools and seeking out student aid, we get used to handing out our private information and it’s easy to get a little bit too lax about this. Putting personal info on the FAFSA form is very different from handing over your credit card info to a telemarketer who promises to help you find student aid. Never routinely fork out personal information that could be used for identify theft – always research who you are giving info to and then decide if it is worth the risk.
Businesses that charge you to find student aid
There are many “aid services” that offer to look for student aid for you for a fee. These fee’s can be rather hefty, sometimes $1,000 or more. If you are in a situation where you need student aid, you probably have better things to spend $$$ on.
The process of finding student aid have been streamlined and filling out and sending in the FAFSA form is great first step to find available student aid that you qualify for.
There are of course the odd scholarship funds and endowments that can be tricky to find, and where an aid service might be helpful, but you should be aware that many of these services wont spend that much time and effort on locating little-known aid options for you. Instead, they will provide you with info about aid options that you would have found anyway through FAFSA or by looking around online on your own, using free resources.
Also be careful with companies that guarantee that they will find aid for you, because they can fulfill that promise by offering you private student loans (with a hefty interest rate) or locating a $100 scholarship for you. Maybe not something worth spending $$$ on?
Here are a few examples of resources that you can use for free to locate student aid options and/or get help with your application.
- The Federal Student Aid Information Center 1-800-4FED-AID (1-800-433-3243)
Help available in English, Spanish and more than 165 other languages.
- The U.S. Department of Labor’s free scholarship search
- Your state’s grant agency
- The financial aid office of a college or career school
- High school counselor
- TriO counselor
- Professional organizations related to your field of interest
The FAFSA form is FREE to obtain and FREE to send in
The F in the FAFSA actually stands for the word Free, to stress the fact that this is a Free Application for Federal Student Aid (FAFSA).
Don’t let anyone trick you into paying to get this form. It is available for free both online and offline.
Also, there is no application fee associated with sending in the FAFSA form.
For more information, visit FAFSA.gov.
Important: When you send in the FAFSA form through the federal government site, you will NOT be asked for your credit card information. If a site asks your for your credit card information, you are not on the official site. This is true even if the site claims to be asking for credit card information just to “validate your identity” or similar.
You don’t need to pay anyone to consolidate your federal student loans into a Direct Consolidation Loan
If you are interested in consolidating your federal student loans into a Direct Consolidation Loan, there is no need to use a third-party service for this. Not only is it expensive to go through a third-party, but it will also involve handing over private information that can be used for identity theft. There have also been cases where seemingly impartial service providers have tried to push debtors into private depth consolidation solutions with inferior terms and conditions – sometimes by creating a situation that is so complex that it becomes difficult to clearly see how bad the terms and conditions actually are.
Simply visit StudentLoans.gov directly instead. You can fill out and send in your consolidation application there and they DO NOT charge an application fee. If you are being asked to pay an application fee, you are not on the official site.
You can also elect to fill out a paper form and send it in by mail if you prefer not to apply online. No application fee is charged for this.
If you need help or information, you can call the The Loan Consolidation Information Call Center at 1-800-557-7392. This service is free of charge.
Contact your loan servicer directly
There are many companies that offer services that are pretty useless since you would get exactly the same result (or better) by contacting your loan servicer directly instead of going through a third party. Offering a service like this is not illegal or fraudulent, as long as the company doesn’t promise more than it can deliver. It’s not more strange than offering a lawn-moving service to people who could cut their own grass.
However, it can be difficult to distinguish a reputable company from a fraudster that is just interested in harvesting your personal information for identify theft, tricking you into making loan repayments that will never reach the lender, or taking advantage of you in various other ways. Because of this, it is safer to contact the loan servicer directly. Also, you will save the money that you would have paid the middleman.
Here are a few examples of changes that you can apply for with your loan servicer without paying any application fee or similar:
- Switching from one repayment plan to another
- Decreasing the size of the monthly loan repayment
- Postponing monthly repayments while you are enrolled in school
- Postponing monthly repayments while you are unemployed
- Loan forgiveness
Who is my loan servicer?
You can find out by visiting studentaid.ed.gov and loggin in to your account.
Examples of loan servicers:
|FedLoan Servicing (PHEAA)|
|Granite State – GSMR|
|Great Lakes Educational Loan Services, Inc.|