Consumer Alert: Your Student Loan Payments Aren’t Going on Your Loans

FTC Warns Against Student Loan Scams

On May 25, 2017, the Federal Trade Commission (FTC) filed a complaint against Strategic Loan Solutions, Student Relief Center and other “debt relief” companies that prey on consumers facing student loan repayments. The complaint is based on allegations that these companies charged illegal upfront fees in return for student loan payment reduction and credit repair, but never delivered on the promise.

The Scam

The scam starts with a phone call promising to help borrowers reduce their student loan payments. They claim that by doing this, they can help consumers protect or repair their credit. Borrowers who are faced with a heavy burden of student loan debt are then charged an upfront fee of up to $1,200 as well as a monthly fee of around $49.99. The kicker? Not only do the funds not go toward the student loan debt, the borrower’s credit actually gets worse as they rely on these companies to make the payments that never actually get applied to their student loan (or any other) account.

Help with Student Loan Debt

If you need help repaying your student loans, the solution is free and simple. Visit the Federal Student Aid (FSA) website or login to your student loan account. The FSA offers repayment plans that vary from 10 to 30 years and can be based on your income. First, you’ll need to put in a request to consolidate your loans, and then apply for the plan you wish to use. In some cases, your payment may be as low as $0. While that doesn’t get you out of debt, it does keep you out of default status and prevents negative remarks on your credit report.

Don’t forget that interest is always accruing on your account and unless you fall under one of the career-based student loan forgiveness plans, you could pay on your loans for up to 30 years before they are forgiven.

Student loans aren’t the only debts that scam companies try to use for leverage. Some also focus on mortgages and other debts. The FTC maintains a list of companies that are not allowed to offer these services and are most likely scams, so be sure to check it before sending any money. Remember, when a debt relief company contacts you, it’s always best to speak with your original lender before making any payments to anyone else for your debts.



  1. What’s up,I read your new stuff named “Consumer Alert: Your Student Loan Payments Aren’t Going on Your Loans | United Voice” like every week.Your writing style is witty, keep up the good work! And you can look our website about [url=]Jailan Sahmoud[/url].

  2. Students must not have any brains.
    Wouldn’t you think the students would
    go to Legal Aid for advice? But, most
    attorneys would spend ten minutes
    to render advice what to do. If nothing
    else, talk things over with the lenders.
    Honestly, these students don’t belong in college. They have no brains.

  3. Sallie Mae/Navient has been ripping off people repaying loans for years. If you pay extra each month, it goes on future interest rather than on principal.


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