Two of the most common scams student loan borrowers face concern repayment and debt relief. Both types of scams can be hard to spot and can damage your finances.
And to further confuse things, there also are many private companies that tell borrowers they can offer student loan debt relief, and then charge a fee to enroll them in free federal programs. While some of them will do what you pay them to, you could probably do the same thing yourself for free.
There are a few things to know and do to help protect yourself against scams and unnecessary services.
Why you may not need student loan debt relief services
Borrowers may have heard of student loan debt relief services. While some of these programs can be legitimate (though largely unnecessary), some are scams designed to take your money and personal information.
Debt relief services are offered by private companies that say they will address your debt. Often, they just work with your loan servicer to develop a new payment plan, which you can do on your own, or with the help of nonprofit groups and other safer resources. Your loan servicer can refuse to work with a debt relief service, too, so there is no guarantee that these companies will be successful for you.
Ultimately, depending on your loan repayment amount and plan, the cost associated with a debt relief service may not be worth it compared to the money you might save with their services.
It could even do more harm than good. For example, if a private company tells you to stop your loan payments, and you stop without the blessing of your servicer, you may end up damaging your credit score by missing payments you’re supposed to make.
If a debt relief service offers to take over all contact with your servicer, demands immediate payments, asks for personal information right away, or promises you something that sounds too good to be true, it may be a scam.
How to spot student loan repayment scams
If the student loan repayment program you are considering uses any aggressive tactics, you can always walk away from the process and call your servicer directly instead.
Here are some ways they may try to get your business:
- Contact you first. If an organization with an official-sounding name that you did not contact first calls, texts or emails you with offers of debt resolution, it may be a scam. A legitimate organization will typically wait until you contact them before initiating services.
- Ask for upfront payments or monthly fees. Legitimate companies rarely ask for payments upfront before they help you with your loans. You can do everything for free that a debt relief or repayment program can do. You can visit studentaid.gov to learn about consolidating your loans and repayment plans, or contact a student loan counselor certified by the National Foundation for Credit Counseling.
- Pressure you to sign up or act immediately. As with any type of scam, if you are pressured to immediately sign up for a program or are told to send personal information urgently, you can pause, take a step back and reevaluate the service.
- Ask for sensitive information. Sensitive information can include your Social Security number, bank account, credit card number or Federal Student Aid ID. Organizations that offer legitimate student loan help do not ask for this. You also may be asked to give power of attorney, which gives the company authorization to act on your behalf in financial or legal matters. You are not obligated to sign documents like this for any loan help. Reputable loan repayment services shouldn't ask for power of attorney.
- Promise immediate student loan forgiveness. Loan forgiveness can be a lengthy process and is dependent on individual borrowers. Therefore, it is almost never immediate.
- Use misleading marketing tactics. Don’t be confused by ads, company names and websites that only look official. These companies may be trying to seem like government agencies or reputable nonprofits. A website that's affiliated with the federal government will usually have a URL that ends in .gov. You may also find helpful guidance and resources on sites ending in .edu, which are available only to accredited schools and education programs. Be cautious of .org, .com and .net addresses because anyone can set up these types of sites.
Where to get safer student loan help
If you need help repaying your student loans, your first step should be to contact your loan servicer. You can discuss payment pauses, repayment options and potential reductions in monthly payments. If you need additional help or help beyond what your servicer can provide, you can consider reaching out to a reputable organization that offers counseling or can help you create a debt management plan.
Certified nonprofit credit counseling agencies, attorneys and some organizations that offer repayment counseling may charge fees. You can clarify cost and terms before you agree to services.
| Student loan help resource | Best for |
|---|---|
| Advice on repayment plans, forgiveness programs and dispute resolution. | |
| Comprehensive information on options for student loan borrowers. | |
| Advocacy on behalf of all borrowers to influence policy. | |
| Complete financial review for struggling borrowers, which can include advice on student loan options and plans for dealing with other debt. | |
| Advice on repayment plans, help with paperwork and budget counseling. | |
| Free virtual workshops and one-on-one appointments for struggling borrowers. | |
| Information for student loan borrowers and an attorney directory. |
How to report a student loan scam
If you’ve been the victim of a student loan scam, you’re not alone. Many Americans have been scammed by fake debt relief programs, and the Consumer Financial Protection Bureau and Federal Trade Commission have mailed tens of thousands of affected borrowers relief checks after they fell victim to student loan debt relief scams, including in December 2022, March 2023, March 2024, and August 2025.
If you spot a student loan repayment or debt relief scam, or fall victim to one, you can report it to help prevent other victims. You can find more information about student aid scams at the Federal Student Aid website.
If you paid for a service and weren’t delivered what you were promised, you can report it to the following agencies:
If you believe your personal information has been stolen or jeopardized, you can contact the following agencies and credit bureaus:
