Paying for college can be overwhelming, which is why universities offer scholarships and financial aid to students who need assistance. While this financial help can be the saving grace for some students, it’s not without risk. Scammers target vulnerable students and families looking for monetary assistance.
Better Business Bureau warns you to watch for the signs of scholarship and financial aid scams. Some scammers cold call perspective victims, offering free grant or scholarship money if the student provides personal information. Others offer to help secure scholarships, grants or other types of financial aid for an upfront fee. In reality, you can generally apply for these free of charge. Others send a check for the scholarship, but you’re instructed to send back payment for taxes or fees. The check turns out to be a fake, and you’re out whatever money you’ve sent.
BBB offers these tips to help avoid scholarship and financial aid scams:
• Check with local government and community organizations to see what’s available.
• Check with your employer to see if they offer any aid for school.
• Complete the Free Application for Federal Student Aid (FAFSA), which determines eligibility for all federal programs and you can complete and submit it for free. Even if you don’t think you qualify for financial aid, fill out the FAFSA. Many colleges and universities use it for non-need-based awards. Visit www.studentaid.gov.
• Do your research and ask questions. Research any organization offering to help you with financial aid. Be cautious if a company is reluctant to answer questions.
• Work with your guidance counselor or college financial aid office. They can help you vet companies offering loans, grants or aid.
• Never give your bank account or credit card information to anyone you don’t know. Once a scammer has this information, they can steal your money.
• Use caution if you have to pay an application fee for a scholarship or grant.
• Be wary of statements, such as “guaranteed or your money back,” “you’ve been selected,” “it will only cost -,” “we have exclusive access,” “act now,” “billions of unclaimed aid,” “we’ll do all the work for you,” etc. They are all tell-tale signs of scams.
• Don’t rely on caller ID. New technology lets scam artists disguise their phone numbers and appear to be calling from any organization across the globe.
• Take your time. Be cautious if a representative urges you to pay immediately to avoid losing an opportunity.
• Watch out for unsolicited offers. Generally, you can’t obtain a grant or scholarship you didn’t apply for. Verify the reputation of the organization before accepting any unsolicited offer.
Scholarship and financial aid scams aren’t the only scams targeting vulnerable students. For example, employment scams try to dupe college students out of their personal information by offering a job with flexible hours and top-of-the-line pay. Another common scam aimed at college students is the listing of too-good-to-be-true apartment and housing rentals. These advertisements feature apartments and houses with incredibly low prices. Fraudsters often simply copy the photo and description of a property, post it online with their own contact information and try to get a deposit and first month’s rent from the victim. In addition, some students are offered fake credit cards. These applications are a tool to gather personal information.
Being prepared can take the stress out of the search for scholarships and financial aid. If you have any questions or want more information on financial aid and scholarship scams, visit www.bbb.org or call 937-222-5825 or 800-776-5301. If you’ve encountered one of these scams, report it to BBB Scam Tracker at bbb.org/scamtracker.