Graduates - Avoid Student Loan Consolidation Scams!

graduates - Avoid Student Loan Consolidation Scams!

Contributing Writer: Crystal Baldwin

At the Vermont Attorney General's Consumer Assistance Program (CAP), we always get a bit nostalgic during graduation season. It is a time of passage as we bid farewell to students that once worked in our office as part of our service-learning course. We hope that they will take with them the skills they learned while providing service to citizens of Vermont. Specifically, we hope they will know how to spot scams. We caution students to be especially suspicious about student loan consolidation scams.

We urge graduates to beware of student loan consolidators that lure grads to pay for their services when the amount of school loans seems daunting. Scammers may claim to offer consolidation services, require payment, and then offer nothing in return. In Vermont, all debt consolidation companies, also known as debt adjusters and debt management companies, must be licensed with Vermont’s Department of Financial Regulation.

As student loans come due, there are many resources available to students to help navigate repayment:

Vermont students can access VSAC for free guidance by calling 800-862-3177

The Consumer Financial Protection Bureau provides student loan tools and resources

The Federal Student Aid Ombudsman Group provides help with disputes about federal student loans and grant programs

If you are contacted by a company soliciting payment from you to help manage your student loan debt, hang up. Instead, connect with student loan management options by reaching out to the resources above. If you have been contacted by a scam consolidation company, contact the Consumer Assistance Program at 800-649-2424 to report it.