There are several types of student loan scams that you need to know. Well, getting a student loan is actually favorable option when you find yourself pretty short on cash to pay for your school. By the way, you might have realized that there are so many people on the internet who offer assistance to get you such a loan.
Unfortunately, most of them are scammers! Here are some of the types of scams as student loan services!
Scam #1: Advanced Fee
The first type of scam which disguises itself as a student loan is the scam that offers you a way to get a loan with the best interest rate as well as the best terms that you can imagine. Most of them state that you would get interests as one to five percent of the loan. However, you will be required to purchase a little money as direct payment. Well, that sounds too good to be true, right?
Well, since there are no companies which offer such interests, then, it is always possible that it is a scam when you see such an offer. Ignoring these kinds of offers is the best way you need to do since although you indeed have to pay some fees when applying for a student loan, you would never be required to pay up front.
Scam #2: Loan Consolidation
The next type of student loan scams is the loan consolidation. Consolidating you loan is the best after you have graduated from school. However, this kind of activity is actually prone to scam attempts and you really need to be cautious. Charging money as a fee when you are trying to consolidate your student loan is the most common type of scam around. If you receive a loan from the federal service, then, there is no way that you would be obliged to pay any fees for consolidation.
However, if you take it from a private company, then, it can be pretty difficult since most of them do charge fees- you need to take student loans from well-reputed companies only.
Scam #3: Debt Elimination
You will need to know that paying your debt is absolutely mandatory when you opt for any kinds of loans, including student loans. There is no way that you would not be required to pay for your loan unless if you encounter special cases. For example, you are deceased before paying, you encounter a severe accident which causes you to get disabled permanently, your school gets closed, or identity theft. If you encounter none of those and yet there are some people who offer you a way to eliminate your debt, then, you should run quickly or just call the police to make him/her confess his crime.
Scam #4: Law Firm Lawsuit
Settling the debt caused by your student loan is the kind of scam that is mentioned here. Typically, you, as a borrower, will be promised that your debt will be able to get rid of by the so-called law firm. You will then be required to pay the amount you can afford, but any payments would never be made by the scammer to abolish your debt. Now, you understand the types of student loan scams!
Read Also, Making Loans for Those with Bad Credit possible .