The FTC sat up and took notice of all the phone calls and complaints from the public regarding various offers for student loan “debt relief.” Known as “Operation Game of Loans,” the FTC and several states are suing and shutting down what they refer to as “deceptive student loan debt relief scams.”
More Than $1.4 Trillion of Student Loan Debt
It’s no secret that going to college isn’t cheap. Many people take out government insured and private loans so that they can get an education. According to the government, there’s currently around $1.4 trillion in student loans.
When student loans go into default, it can do more than affect the credit of the borrower. It can result in frozen or levied bank accounts, intercepted tax refunds, and it can even affect whether someone is hired for a job.
Student Loan “Debt Relief” Companies Accused of Taking Millions from Struggling Families
The FTC alleges that these companies have taken more than $95 million in illegal fees from people desperate for help. Companies such as Alliance Document Preparation (and its numerous ‘doing business as’ names) call people or contact them through social media and tell them that they can help them get out from under their student loans…for a fee of up to $1,000.
The FTC recently requested a permanent injunction and “equitable relief” from the court to stop Alliance Document Preparation (and its subsidiaries) from continuing their practices. In September 2017, the federal court issued an ex parte order to temporarily stop their business practices while also freezing their assets.
Finding Legitimate Student Loan Help
Because of the prevalence of these student loan scams, it’s important that those with student loans understand their legitimate options for help. Legitimate options include student loan consolidation, forbearance, repayment based on income, and forgiveness programs. To learn more about how you can get help with your student loans without paying a third party, click here.