Be on the lookout for student loan forgiveness scams
PITTSBURGH (KDKA) - Student loan service companies are being overwhelmed with refund requests after President Biden's forgiveness program.
Despite the pandemic's pause on student loans, many people continued to make payments.
Now, they're wondering if they can get that money back.
The answer for many is yes.
While most of the 42 million people covered by the pause did not make payments, about nine million kept paying. It's not clear yet how much of the education department's $1.6 trillion portfolio of loans will be affected.
Pennsylvanians qualifying for the student loan forgiveness plan won't have to worry about how it impacts their taxes. Governor Tom Wolf said the forgiveness won't count as taxable income at the state level. It's not taxable at the federal level.
Additionally, there is now a warning from the Federal Trade Commission about possible student loan forgiveness scams.
The Better Business Bureau said scammers may use Biden's forgiveness plan to defraud borrowers looking for eligibility information.
To protect yourself the BBB has these tips:
- First, know the ins and outs of your student loan. Know the terms and don't fall for a scammer who promises benefits the government or your loan provider has not already offered.
- Do your research. Look up the lender or company reaching out to you to find out if there's a scam artist on the other end.
- And look twice before you click. The BBB said some impostors often create look-alike government websites.
