Finally Some RELIEF!!!


You have HOW MUCH in student loan debt?!?  Well, did you know you can pay a mere $5 a month for the next year and then have the rest of your debt wiped away?  Wouldn’t that be great?  Only $60 paid and no more student loans!  This would be great, but is also only going to be true if you only owe a total of $60 in student loan debt.

I can’t even count the number of student loancomputer-hacker “forgiveness programs” we have heard of in our office.  Just type in a search on the internet and you will be overwhelmed with the options laid out before you.  For some reason, they like to throw Obama’s name into the mix and think it will make it all legit.  Uh……. yeah, no.

Some of the other scams that are out there:

  • “Just pay us a small processing fee up front and we’ll start working on your case right away.”
  • “Our attorneys can work out a settlement.  Just make your loan payments to us and then we’ll start working on a settlement for you.”
  • “If you have a financial hardship, we can get your loans forgiven in 3 months.  Just send us your social security number to get the processing started.”
  • “We’ll be honest with you.  The only real way to deal with your student loans is to consolidate them all into a single new loan with us.  And it will only cost you a modest processing fee.”
  • “Work with us and we’ll get you a no-interest loan.”  Wait, isn’t interest how they make their money, the whole reason they are in business????


Let’s start with federal student loans.  Even on the best forgiveness programs for teachers and Perkins loans, you are going to be maintaining the loan for at least 5 years.  The only way you can get out earlier is if your school closes under VERY specific circumstances or you can prove that they misrepresented and got you into loans that they clearly knew were not good.  Or you pay them off faster than the minimum payments.

Now, you can go into income-driven payment programs that might drop your payments to extremely low amounts, but you will still usually be paying for at least 10 years.  These can be some good options for people, but aren’t necessarily going to be the windfall that the scams promise.  That’s just the reality of loans and debt.  But at least there are real options available.

Now on private student loans, that’s even tougher.  Because it is private with little to no government involvement, you are generally going to either pay according to the terms you agreed to when you first borrowed or you are going to refinance into a new loan and pay all of it according to the terms of that loan.  And there aren’t generally a lot of options or negotiating.  You can either take it or leave it.

So why do the scams work?

Let’s get into some psychology here.  The human brain generally works one of two ways – logical or emotional.  Left brain vs. right brain, if you will.  shocked-girlScammers are often very good at pulling on the emotional side of our brains, knowing that the more emotional we get, the less logical we are able to think.  Student loan debt can draw a lot of emotions based on the size of debt, impact of debt, perhaps school or professional associations, and even in response to the media’s commentary on student loan debt.  All of that contributes to people falling for student loan debt relief scams.

So what to do?

First, understand that the scammers are out to make money.  Then go where it’s not all about the money.  You can go to StudentLoans.gov, StudentAid.gov, or NSLDS.ed.gov to find out about the loans you do have and the real programs that are available to you.

Second, contact a not-for-profit counseling agency that deals with student loans.  They might charge a fee for the counseling session, but it will be much less than the fees charged by the scammers.  In most cases, the fee charged doesn’t even fully cover their actual cost of providing the appointment.  They will provide you with information regarding your options and walk with you as you make the decision that is best for you.  You can find a local counseling agency through the National Foundation on Credit Counseling.

To make it even easier for you, the counselors at the Center for Financial Resources are available and ready to help you.  You can call us at 605-330-2700 or go online to schedule an appointment.  Our counselors are all certified specifically in student loan counseling.

Where ever you end up, just make sure it is legitimate and not a scam that will only cost you more.


written by Breck Miller
images courtesy freedigitalphotos.net

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