When it comes to college and student loans, Ebony Smith's learning curve has been steep.
"I am 20 years old, and I go to school at the University of Arizona Global Campus while I work part-time at Sephora," said Smith. "I thought I was getting some help."
The possibility of student loan forgiveness came onto the Denver resident's radar because of President Joe Biden's campaign promise.
"I thought it was gonna be that the loans were going to be forgiven totally," said Smith.
So when she received a call saying she had qualified for student loan forgiveness, she thought it was legitimate.
Smith agreed to have hundreds of dollars in payments taken directly from her account.
"I thought it was going directly towards my loans, which they said they were," she said. "But then I found out none of it had been paid. It was very heartbreaking."
In May, the Federal Trade Commission warned about an increasingly popular con in which scammers promise loan forgiveness for all, which does not exist yet.
The reality is most of the calls promising loan forgiveness may not really be about paying off your loan.
The company that contacted Smith, Las Vegas-based Student Loan Doc, did not respond to Contact Denver7's requests for comment, but it has an F rating with the Better Business Bureau and dozens of complaints in the last year. The company claims that it is merely a document preparation service.
"We've had them on file for quite a while and have been dealing with them for quite a while," said Rhonda Mettler, the operations director for the BBB of Southern Nevada. "[Customers] need to be wary of promises. "
Meanwhile, Smith is disputing the charge with her bank, and she wants others to learn from her mistakes.
"Really, just be careful, because you never really know people's true intentions," she said.
Here's what you need to know to protect yourself:
- If federal student loan forgiveness for all is approved, you will hear about it from the Department of Education, not a random call or text.
- You don't need to pay for help. You can fill out the forms yourself and ask your loan servicer for help for free.
- You can tell it's a student loan scam if the company asks you to pay money up front or to pay monthly fees, if you are promised immediate student loan forgiveness, or if you are asked to provide your FSA ID or password.
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