PENNSYLVANIA, USA — Federal student loans for more than 43 million borrowers across the U.S. are now frozen until August 31st.
“The great news is no interest has been accruing on those accounts," said Mary Jo Terry, managing partner at Yrefy. "The bad news is it’s been two and a half years"
Since the start of the COVID-19 pandemic, both the Trump and Biden Administrations have extended the moratorium on loan payments multiple times.
While it may be a reprieve for many, it’s also spelling trouble.
“What we’re seeing is more people are attempting to scam federal borrowers and also contacting people that don’t even have student loans," said Terry.
Terry has worked in the education industry for over two decades.
She says scammers are using phone, text, and email to try to trick borrowers.
“They’re trying to say ‘Hey give me money, give me $399, and I’ll get your loans forgiven, or I’ll get your loans canceled,'" she explained.
While the White House says canceling at least some student debt is still on the table for President Biden, nothing has been decided yet.
“Anything around forgiveness or cancellation is going to be big news," said Terry. "It’s going to be all over the media so trust your sources of information. You’re also probably going to be contacted by your loan servicer if you’re eligible.”
Experts say if anyone is asking for money or personal information, such as social security or bank account numbers, it’s most likely a scam.
That’s why you should always know who your loan servicer is and what your exact loan balance is.
“That way you know if they’re asking you about the balance of your loan, they should be to the penny, to the dollar, they should have that information.”
And if you fall victim, you should contact your servicer, bank, and credit bureau and have them help you.
