How do I recover after falling for a student loan forgiveness or debt relief scam?
Report to the FTC and CFPB. Cancel any power of attorney you signed and dispute fees charged by the company with your card issuer. Change your FSA ID credentials immediately.
Last reviewed: 10 June 2026
Explanation
Student loan forgiveness scams target borrowers by offering to eliminate, reduce, or manage their federal student loans for an upfront fee. These services collect fees ranging from a few hundred to several thousand dollars, often while doing nothing — or worse, submitting fraudulent applications or stealing the borrower's Federal Student Aid (FSA) login credentials.
The most urgent action is to log into your studentaid.gov account and change your FSA ID password. Check whether any unauthorized servicer changes, income-driven repayment plan applications, or other account actions were made. If your FSA ID was changed, contact the Federal Student Aid Information Center at 1-800-433-3243 to recover access.
File a complaint with the FTC at ReportFraud.ftc.gov and the Consumer Financial Protection Bureau at consumerfinance.gov/complaint — debt relief company fraud is a CFPB enforcement priority. Also report to your state attorney general's office.
If you signed a power of attorney giving the company authority over your loans, revoke it in writing immediately. Dispute already-collected fees as misrepresentation — the services were either not performed or were available for free through the Department of Education. All federal loan repayment plans and forgiveness programs are free to apply for through studentaid.gov.
Common red flags
- Company charges an upfront fee for loan forgiveness that is actually free through the DOE
- Guarantees of loan forgiveness without reviewing your specific loan details
- Asks for your FSA ID username and password
- Tells you to stop making loan payments while the application is pending
- Cold call or email about your student loans when you did not seek help
What to do now
- Change your FSA ID password at studentaid.gov immediately
- Check your loan account for unauthorized changes
- Dispute any charges with your card issuer
- Revoke any power of attorney signed with the company in writing
- File with the FTC at ReportFraud.ftc.gov
- File with the CFPB at consumerfinance.gov/complaint
Frequently asked questions
Is student loan forgiveness ever really free?
Yes. Programs like Public Service Loan Forgiveness (PSLF), income-driven repayment forgiveness, and Teacher Loan Forgiveness are all applied for directly through studentaid.gov at no charge. You never need to pay a third party to access federal loan programs.
The company enrolled me in an income-driven plan and charged me fees — is that fraud?
Charging fees to enroll someone in a free federal repayment plan is illegal under the FTC's Telemarketing Sales Rule for most debt relief companies. Report to the FTC and dispute the fees with your card issuer.