With tuition costs on the rise, more and more people are searching for scholarships to ease the financial burden of higher education. Unfortunately, there are scammers who prey on students and their families using a variety of schemes.
In 2018, the FTC reported 725 consumer complaints related to student aid. Here are some examples in which students and their families get scammed:
Students often use the Free Application for Federal Student Aid, an official government financial aid form found on the U.S. Department of Education's website, to apply for financial aid. However, there are some companies that offer to fill out your FAFSA and scholarship applications for you. But on top of accessing your personal information, they charge fees. The FAFSA application is free to fill out and additionally, scholarship sponsors require that students complete the paperwork and even draft letters and essays.
If a scholarship necessitates an application fee, more than likely it's a scam. Never pay for scholarship consideration, even if it "guarantees" student aid.
Scholarship seminars claim to have the inside scoop on student aid, using high-pressure sales techniques to peddle their services. Regardless, there are many large, free databases of scholarships, such as scholarships.com. Scholarships can also be found on your college website. Your advisor or guidance counselor can help you navigate student aid better than anyone else-and they won't charge you.
Other red flags include:
All in all, if it sounds too good to be true it probably is. Report fraud to the FTC. Stay smart and stay safe!