FORBES: Student Loan Consolidation Companies Prowl For Borrowers

Career College Central Summary:

  • I’ve been inundated with questions from concerned readers over the last few months about the tactics that student loan consolidation companies have been using to recruit customers and borrowers. The concerns are simple yet scary: are these promises too good to be true? They want money up front, I’m worried? XYZ Company asked for my pin, is that okay?
  • The fact is, these companies can’t do anything you couldn’t do yourself. If the company is legitimate, all they will do is file paperwork on your behalf and charge you for it. Here’s what you need to look out for.
  • Student Loan Consolidation and Aid Companies Aggressively Advertising To Borrowers
  • These student loan consolidation companies, or student loan aid, or other variation, have been aggressively advertising to borrowers, especially ones in need of assistance.
  • Lately, you can find these companies targeting borrowers on Facebook, through direct mail ads that look very official, and even cold phone calls. Many of these companies are paying for lists of students from private for-profit colleges. These schools will sell the contact information for students who used financial aid, and these student loan “help” companies are aggressively marketing to them.
  • When these companies do connect with a borrower, the conversation typically focuses directly on how much money you can save – not how or through what program. Usually, the company will ask for your loan balance, and then jump right in to telling you how much you could save or get forgiven. Sometimes they simply say they can lower your payment and NEVER tell you how.
  • All of these tactics should be red flags for student loan borrowers. Here’s a list of companies that have been know to market aggressively to borrowers.

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