It’s no secret that the COVID-19 pandemic hit everyone hard. Before the global lockdown, maybe you started classes, took out federal student loans, or tried to pay off student debt. If the government offered loan forgiveness for all, most people would jump at the chance to shed debt and start fresh. Enter the scammer. Scammers prey on people by promising loan forgiveness, usually in exchange for a payment.

If you owe student loans, it’s natural to want debt forgiven and believe that the government is currently offering this type of relief. Although debt can affect everything from your credit score to peace of mind, falling victim to a financial scam can affect both your well-being and your wallet. While the Biden administration promised to prioritize student loan forgiveness, this has not yet resulted in legislative action.

Have you received a call about loan forgiveness? Did an email with a payment link for a forgiveness plan pop up in your inbox?

Here’s how to spot a student loan forgiveness scam and how to protect yourself (and your money) from financial fraud.

What Are Student Loan Forgiveness Scams?

Student loan forgiveness scams are a type of financial fraud. Like many other types of scams, fraudsters typically contact you through phone calls, emails, or letters in the mail. You might see student loan forgiveness ads pop up on search engines or your Facebook, Instagram, or Twitter accounts.

Student loan relief scammers typically require a fee to enroll you in a benefit that you can often access free of charge.

Here’s a good rule of thumb: if it sounds too good to be true, then it’s probably a scam.

Why Is There a Rise in Loan Forgiveness Scams?

The pandemic caused economic issues, but scammers have extra time on their hands and a new crop of financially stressed people to target. Since the government paused loan repayment due to COVID-19 and erased some borrowers’ debt for specific schools, this grain of truth allows scammers to contact people to absolve them of their debt overnight.

There’s misinformation and confusion out there about pandemic loan forgiveness. Loan scammers take advantage of the chaos to steal your money or your identity.

On August 6, 2021, the Department of Education announced that it would extend its final student loan deferment through January 31, 2022. No interest will accrue on loans. If you owe student loan debt, this can offer you some breathing room.

How to a Spot Student Loan Forgiveness Scam

  1. The loan forgiveness company runs ads that pop up on your search engine or social media.
  2. They ask you to make an upfront payment or pay a monthly fee first.
  3. The person promises that their company will forgive your loans immediately.
  4. The person pressures you into making an on-the-spot payment.
  5. They ask you for personal information such as full name, birth date, home address, card or bank number, or social security number before they can assist you.

Watch Out for Some of These Common Student Loan Forgiveness Scams

  • Advanced Fee Scam (offers the best services or rates for a fee).
  • A Law Firm Student Loan Settlement (someone from a purported law firm contacts you about a settlement to decrease your loan balance by thousands of dollars.
  • Student Loan Debt Elimination Scam (currently, the only way to eliminate federal loan debt is through one of the legitimate ways on the Department of Education’s information page.

Six Ways to Protect Yourself from Student Loan Forgiveness Fraud

Verify the Source

If you receive an email from the Department of Education, check that it’s the correct address. Don’t reply or click on any links. Instead, log into your FAFSA account or student loan lender account for further information. If someone called you, it’s likely not a government representative.

Be Informed

Know what’s happening with federal student loan policies. Scammers assume that most people don’t have a good idea about what government programs for student loan forgiveness are rolled into coronavirus relief.

Legitimate loan forgiveness programs don’t promise to erase your loan overnight. Federal loan relief programs also won’t ask you to make an extra payment to forgive your loans. Keep up to date with government loan forgiveness, cancellation, or discharge policies at

Don’t Engage

Pay attention to calls and emails that you receive. Make sure that you’re engaging with a legitimate source.

If strangers call you about student loan relief, hang up the phone. Don’t reply to that email or click on any links. Don’t get sucked into spurious loan relief ads. A student loan forgiveness fraudster might try to keep you on the phone while charging hefty fees per minute.

Don’t click on links from an unknown email address. Even if the address appears legitimate or familiar, hover over the email address field. If it’s a cheap scam, the email address might look different, or if it’s a more sophisticated scam, the fraudulent email might look identical except for another character or symbol.

Don’t Be Intimidated

Many scammers will hound you with collection warnings or threaten to send the police to frighten you into handing over your credit card or bank account information. The Department of Education will not call you and harass you for payment and information.

Don’t Give Out Personal Information

Scammers usually try to get you to give out sensitive information. Never give a caller your credit or debit card, account number, FAFSA pin, or social security number. Please don’t send them via email or type them into an unverified website. It’s a good idea to keep your full name date of birth and home address to yourself, too.

Don’t Say Yes

A favorite scammer trick is when the caller asks, “Can you hear me?” Most people will automatically say yes. If you do this, then the scammer can capture a recording of your voice giving consent. They can use this as a basis to access personal information that they might otherwise have no way to access.

What to Do If You’ve Already Been Scammed

Keep records of all calls, emails, or transactions. If you think you’ve fallen victim to a student loan relief scam, you should report it to government authorities.

You can self-report the scam to your state attorney general, the Consumer Financial Protection Bureau, and the Federal Trade Commission. These organizations will pursue student loan scammers based on the information that you provide them.

How Can I Get My Federal Student Loans Forgiven?

Now that you know how to spot a student loan forgiveness scam and how to protect yourself if you encounter a call or an email with fraudulent claims, you likely want to know if the government will forgive your student debt. According to the Department of Education, there are currently twelve ways to have student loans discharged or dismissed.

These include:

  • Public Service at a government or not-for-profit organization.
  • Teacher Loan Forgiveness for Direct and FFEL Program loans.
  • Closed School Discharge that applies to Direct Loans.
  • FFEL and Perkins Loans.
  • Perkins Loan Discharge.
  • Total and Permanent Disability Discharge.
  • Discharge Due to Death.
  • Discharge in Bankruptcy in rare cases.
  • Borrower Defense to Repayment.
  • False Certification Discharge.
  • Unpaid Refund Discharge.
  • Eligibility for Parent Borrowers.

You can check with the Department of Education about the forbearance, delayed, or minimum payment options that they offer.

The Takeaway

Student loan debt can cause high levels of personal and financial stress. While the government has extended delayed repayment for student loans through January 2022, they have not yet announced any concrete decisions about student loan forgiveness.

If you have student loans to repay, you can use these above tips to stay alert, keep informed, and spot a scam.

With possible student loan relief on the horizon and a current forbearance plan in place, you can protect yourself against financial fraud, secure your personal information, and send potential scammers on their way.

Image by Brenda Lamouthe Coulomme via