Scholarship Scams - Buyer Beware
When you have children heading off to college it is important to explore
your options with scholarships and financial aid. But, like most things
in life there are people who are out there to try and take advantage of
individuals. It is important to be aware of such scams and to avoid them
to protect your credit and your sanity.
The number one red flag would be any scholarship that asks for a credit card or bank account number to secure or hold the scholarship. Never give this information out.
Avoid any scholarship that claims that they will do all the work for you, or that it is as easy as signing your name. Scholarships take some effort and require more than the minimum information. It would be hard to believe any scholarship would be valid without you filling out the information and signing on it.
There are also services that will help find scholarships for you and will give you access to exclusive scholarships and grants by signing up with them for a fee. Scholarship information is information that you can find yourself for free. You do not need to pay anyone for his or her services. If you feel that applying for scholarship applications is intimidating you can ask to speak with a counselor at school, or even a teacher who may be able to assist you.
If you receive a letter that says that you are a finalist for a scholarship that you never applied for, you may want to research it more. More than likely it is junk mail and they are trying to get you to sign up for stuff. However, there are some scholarships that a family member may have recommended you for. Research them to find out if they are a reputable company. If there is a phone number, call it for more information. At the first sign of them trying to sell you something or asking for your banking information, politely end the conversation.
You will want to stay away from any company that claims that the scholarship is “guaranteed or your money back.” No one can guarantee that they will get you a legitimate scholarship. Scholarships are available to anyone that fits the specific qualifications.
A good source for scholarships would be at the college that you are planning on attending. You can contact the school with any questions about a specific scholarship. They may have a list of current potential scams that they can warn you about. You will also find scholarships that are only specific for that particular school.
Scholarships are not the only way that con artists take advantage of students and their parents. There are many student loan companies that will take advantage of you. Many will draw you in with the promise of low interest rates. They may ask for a processing fee in order to lock in the “incredibly low one-time” interest rate. Do your research before working with any company.
If you are unsure if it is a scam or not there are a few steps that you can take to find out. You can take all the suspect information to your guidance counselor and they can assist you with finding out if it's legitimate.
You can also look up a company through the Better Business Bureau. If they do not show up on their list, then you may want to avoid it. If they are on the list read their reviews of the companies business practices. If you have been taken advantage of or believe you are a victim of fraud then you may want to contact your State Attorney General's Office to file a complaint.
www.bbb.org - website for the Better Business Bureau
www.scholarships.com - website where you can find free access to scholarships.
www.finaid.org/scholarships/ - website that has tips and information on filling out scholarships. Also includes a list of scholarships.
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