Student Loan Scams

College students, take note! If keeping up with your coursework, acing your exams andPiggy bank with the words student loan written on it scrambling to hand in every term paper before the deadline weren’t enough, you now have something else to worry about: Student loan scams are on the rise. Scammers know you hate owing tens of thousands of dollars, so they’re quick to offer you an easy — but completely bogus — way to free yourself from that debt. Or, they might falsely claim you owe the feds taxes on your debt. If you’re already stressed about your student loans, that makes you an easy target.

Don’t get scammed! All it takes is a lack of knowledge and a small blunder to be out thousands of dollars.

Here’s what you need to know about the three most popular student loan scams.

1.) Student loan forgiveness scam

In this scam, a student loan debt company will reach out to you and offer to completely forgive your student loan for a relatively small fee.

Your student loan, gone? Sounds like a dream! Unfortunately, it’s more like a nightmare. No student loan company would completely forgive your loan, even for a fee. The company is likely bogus and you’ve been targeted for a scam.

This scam attempts authenticity by sounding like Public Service Loan Forgiveness, a legitimate federal government program for public servants with federal student loans. They may even claim to be connected to the U.S. Department of Education, but that is also false. If you fall for the scam, you’ll still need to pay off your loan, plus you’ll lose the money you just shelled out.

If you’re looking for student loan debt relief for your federal student loan, consider enrolling in a no-cost student loan repayment plan through the federal government. This plan might offer student loan forgiveness after 20-25 years. Unfortunately, there is no other way for a student loan to be dismissed.

2.) Student loan consolidation scam

In a scenario similar to the above scam, a student loan company will contact you promising to consolidate your loan and lower your monthly payments, all for a modest fee.

Right off the bat, you can peg this as a scam. While many institutions can refinance student loan debt, the federal government is the only entity with the power to consolidate it. And they won’t charge a fee for this service.

If you’re looking to consolidate your student loans, check out Studentloans.gov or call 1-800-557-7394.

3.) Student loan tax scam

Those tax scammers will try everything to hook a victim! In this con, a scammer will spoof the IRS’s toll-free number and call a college student, claiming they owe thousands of dollars for a “federal student loan tax.” The scammer will demand immediate payment upon threat of arrest or a lawsuit. They’ll also claim to only accept specific forms of payment, like a wire transfer or prepaid debit card.

If you’re on the receiving end of a phone call like this and you’re starting to panic, here’s a newsflash for you: the “federal student loan tax” does not exist. It is nothing more than a not-so-clever trick dreamed up by a crooked scammer.

Also, the IRS will never reach out to you by phone without first notifying you via snail mail. Nor will they demand payment over the phone or insist on a specific payment method – especially a prepaid gift card.

If you’re targeted

If you’re targeted by a student loan scam, it’s crucial that you don’t engage with the scammer. Hang up as soon as you recognize a scam and delete any suspicious emails about your student loan that land in your inbox.

It’s equally important for you to bring the scam to the attention of the authorities to help them capture those scammers. You can file a complaint with the FTC at ftc.gov, alert the local law enforcement agencies, and report any tax-related scams to the IRS at 1-800-829-1040 or at IRS.gov. Finally, be sure to warn your friends about a circulating scam so they know to be super-careful.

Practicing caution and knowing what to expect will protect you from scammers who are out to make a buck off anyone they can bamboozle. You work hard in school; you deserve to keep your money and your sanity, too!

Your Turn: Have you been targeted by a student loan scam? Share the pointers you picked up from your experience with us in the comments.

SOURCES:
https://typicalstudent.org/hot/your-money/3-popular-student-loan-scams-2019

https://thecollegeinvestor.com/317/top-student-loan-scams/
https://www.google.com/amp/s/www.forbes.com/sites/zackfriedman/2019/01/21/student-loans-scams/amp/

7 Ways To Spot A Loan Scam

Your credit’s trending in the wrong direction, you’re short on cash and you’re desperate image of a hand on piles of moneyfor a loan. You need to get your hands on some cash to help pull you out of this tight spot, and you need to do it – fast! Unfortunately, though, it feels like no reputable institution is willing to grant you a loan. And the few that are will do so only with very unforgiving terms.

Then, miraculously, you find it: an ad for an easy loan with great terms that will qualify almost anyone. Best of all, the company is willing to work with borrowers regardless of their financial state. Finally – a way out! It’s the answer you’ve been waiting for. A dream come true.

Or is it?

Most successful scams prey on desperate and vulnerable victims. Loan scams are no exception: They specifically target people who are in dire straits and may be willing do anything to get their hands on some cash.But sadly, falling prey to a loan scam will only pull the borrower deeper into the pit of debt.

Once a loan scammer has snagged a victim, they will begin the process of having the borrower fill out a loan “application.” The victim, eager to get that quick money, willingly shares anything asked of them, including sensitive and personal information. With that info in hand, the scammer can make off with these details and empty the victim’s accounts, charge a shopping spree on the victim’s cards or even steal the victim’s identity.

Sometimes, the scammer may ask for an upfront debit card payment as collateral or insurance for the loan. Obviously, the victim will never see that money again.

Awareness and caution are the best defense. Here’s 7 proven ways to spot a loan scam:

1.) There’s no credit check

Every reputable lender, whether they’re affiliated with a credit union, a car dealership or an online institution, will want to verify that the borrower can, and will, repay the loan before they agree to the transaction. If a lender doesn’t bother checking your credit score and history, you can be sure they have no intention of lending you a dime.

The single exception to this rule is payday loans. Since these have such short terms and extraordinarily high interest rates, lenders don’t bother with credit checks. They still make money even if borrowers occasionally default on their loans.

2.) You’re asked to pay an upfront fee

You shouldn’t have to pay for a loan. When a lender asks you to pay a loan collateral, insurance or fees by prepaid debit card or wire transfer, you’re being scammed! Back out of the deal before it’s too late.

3.) The lender isn’t registered in your state

As per the Federal Trade Commission (FTC), every lender and loan broker must be officially registered in the states where they conduct business. A legitimate lender will have a list of states posted on their site to let borrowers know where they’re registered. If you can’t find this information on the site, and the lender refuses to provide further details, they are likely not legitimate.

4.) The lender is not affiliated with any financial institution

Authentic lenders must operate under a bank or credit union charter. This information should be clearly posted on the lender’s site. If it’s missing, you might be dealing with a scammer.

5.) You’re (sometimes strongly) urged to act immediately

If a lender stresses that you must submit your information and make your upfront payment RIGHT NOW, you’re likely interacting with a scammer. Most loans don’t expire after a few hours, or even a few days. The scammer is only trying to get you to act without thinking.

Exit the site immediately and change your device’s passwords as an extra precaution.

6.) The site isn’t secure

Whenever money is changing hands online, you’ll want to verify that you’re dealing with a legitimate site. The site’s address/URL will give you an easy clue: Look for an “s” after the “http” in the address. If it’s there, the site is secure; if it’s not, back out now!

It’s important to check the site’s security as soon as you hit the homepage. Waiting until you’re ready to submit your information can be too late. Creepy as it may sound, lots of hackers use keystroke loggers, which record as you type. That means, even if you haven’t actually submitted your filled-out application, they may already have all the information they need to scam you. If you check for a site’s security as soon as you’ve connected, though, you’ll exit any unsecured sites before you start typing.

7.) The lender has no physical address

Always do a quick online search using the lender’s official name. If it’s legitimate, a search should bring up a physical address and phone number for the company. If the lender’s name doesn’t turn up anything beyond the online world, opt out of the loan immediately.

Are you short on cash? Don’t get scammed – let us help! Call, click, or stop by Destinations Credit Union today to learn about our personal loans and other ways we can help keep or put your finances back in the black.

Your Turn: Have you been targeted by a loan scam? Share your experience with us in the comments!

SOURCES:
https://www.google.com/amp/s/www.bankrate.com/finance/loans/personal-loan-scam-signs-1.aspx/amp/

https://www.google.com/amp/s/peerfinance101.com/warning-signs-personal-loan-scams/amp/
https://www.finder.com/personal-loan-scams

Beware Social Media Scams!

The social media explosion has forever changed the way we interact with one another. InThree young adults using their phones fact, everyone knows that a vacation, a dinner out or child’s milestone never really happened unless you post it on Facebook or Instagram.

But what most people don’t realize is that the advent of social media has generated its own brand of scams. And they’re as nefarious as they are widespread. Over the last few years, the numbers of social media scams have multiplied exponentially, with fake Facebook and Twitter accounts jumping by a full 100% in just a year.

There are several types of social media scams, but most involve some kind of phishing scheme component.

Here’s how it happens: Scammers troll your accounts and try to “friend” you. They might have received your contact details from a friend of a friend or through some other roundabout method. Or, they may create a bogus profile or clone the profile of someone you know in real life. Then they’ll get you to share personal information with them without you even realizing it. Often, they’ll ask you seemingly random questions, like the name of your first pet, or your grandmother’s maiden name, and you’ll blithely provide them with the answers.

What you may not realize, though, is that you’ve just given away the security questions for your checking account password and login information. By the time you do realize this, it’ll be too late.

Other times, social media scams involve fake offers and promotions. You might click on a job offer, an incredible prize you’ve supposedly won or a get-rich-quick scheme. All you need to do to get your hands on the goods being offered is….share your personal information.

Unfortunately, that’s all the scammers need to rob you of your identity – and your money.

In yet another scam that has us at Destinations Credit Union really riled up, fraudsters will exploit your trust in your credit union to get your attention. They’ll reach out to you while impersonating Destinations Credit Union and claim to have incredible rates on personal loans, cash loans or a similar product.

You might think the poster is really us, and willingly click on the embedded link and then follow their application instructions. Sadly, once the ball starts rolling on these scams, it’s nearly impossible to stop. The scammers might then empty your accounts, trick you into making upfront payments to qualify for the loan, or take out another loan in your name, leaving you to foot the bill.

You don’t have to be a victim to these scams. Read on to learn how to spot, prevent and react to social media scams.

How to spot a scam

Watch for these red flags:

  • The poster is offering a deal, prize, job or scheme that sounds too good to be true.
  • You’re asked to make an upfront payment for a job, prize or loan application.
  • A reputable company uses a generic account, such as Yahoo or Gmail, to contact you.
  • You’re told that you qualify for a loan amount that is more than you need.
  • You’re urged to act immediately or risk losing out on the job, prize or loan.
  • The scammer looks like they represent Destinations Credit Union, but when you call us up to talk about the offer, no one knows what you’re talking about.
  • You are asked to share sensitive information before you’ve actually applied for anything.
  • A new social media “friend” keeps asking you random questions.

Preventing social media scams

Fortunately, preventing social media scams isn’t all that difficult. All it takes is a bit of common sense and some practical steps.

  • Think before you click. Ignore anything that sounds sketchy or overly intrusive.
  • If a lender has contacted you, check their legitimacy with the BBB at (859) 259-1008, 1-800-866-6668, or www.bbb.org.
  • If you need to take out a personal loan from Destinations Credit Union, contact us directly at 410-663-2500 or through our website at www.destinationscu.org. This way, you’ll know it’s really us.
  • Never share personal information online with someone you don’t know.
  • Look for a publicly listed street address and phone number that corresponds with the name of any alleged “company” that has contacted you.
  • Never agree to pay for a product or service upfront without being certain of its legitimacy.
  • Check your social media privacy settings on a regular basis. They’re often changed without you knowing it.
  • Never post anything that can be used to steal your identity.

If you are a victim

If you’ve been hooked on the social-media phishing bait, it’s important to do some damage control ASAP.

  • Shut your computer. Before anything else, you’ll want to block the scammer from accessing your computer again. Log off your device and immediately change your passwords, using a different computer or mobile device.
  • Put a fraud alert on your credit. Contact the three major credit bureaus; Equifax, Transunion and Experian, to let them know your identity has been compromised. This will prevent or delay any loans or lines of credit the scammer tries to take out in your name.
  • Let us know. Here at Destinations Credit Union, we want to do our part in stopping scammers in their tracks. By alerting us about a scam, we can watch your accounts for suspicious activity and refuse to honor sketchy charges. Also, if your case involved a fraudulent loan offer using our name, we’ll do all we can to take down the scammers.
  • Alert the Federal Trade Commision (FTC). If you’ve been targeted by a scam, make sure to tell the FTC about it so they can do whatever they can to catch those crooks.
  • Tell your friends. It’s equally important to let all of your friends know about the scam. Consider forwarding them the scammer’s bait in a private message so they know to ignore it if it shows up in their own social media feeds.

Don’t let scammers win! Always use caution when online.

Your Turn: Have you ever been targeted by a social media scam? Tell us all about it in the comments!

SOURCES:
http://m.nbc12.com/story/22461601/12-on-your-side-man-loses-money-in-online-loan-scam  

https://www.moneysmart.gov.au/scams/banking-and-credit-card-scams/loan-scams  
https://www.bbb.org/lexington/news-events/news-releases/2015/08/bbb-warns-online-loan-seekers-about-fake-site-using-commonwealth-credit-union-lawrenceburg-address/  
https://www.google.com/amp/s/www.csoonline.com/article/3202104/phishing/new-social-media-scams-can-you-tell-friend-from-foe.amp.html  
https://inspiredelearning.com/blog/social-phishing/