Need extra funds to help pay for college? A number of companies offer assistance in locating potential scholarships. However, in your quest for college cash, be aware of fraudulent practices that can cost you more than expected. Below, the Federal Trade Commission lays out six claims that scream,“scam.”
1. “The scholarship is guaranteed or your money back.”
Legitimate companies do charge fees, but they don’t guarantee or promise anything. The FTC says that companies offering a money back guarantee can’t be trusted, because they “attach conditions that make it impossible to get a refund.”
2. “You can’t get this information anywhere else.”
Simply not true. Many companies match your profile against a national database of scholarships to find those for which you qualify. Instead, meet with your school’s guidance counselor or search reputable websites like www.fastweb.com or www.educationplanner.org to find scholarships that you’re eligible for.
3. “We’ll do all the work for you.”
Somebody else doing all the work hasn’t gotten you where you are today, so why should this be any different? You have to apply for scholarships or grants yourself.
4. “The scholarship will cost some money.”
A fee for the service is the only money you should be paying. Scholarship money should never cost you anything.
5. “I just need your credit card or bank account number to hold this scholarship.”
Once a scam company gets your credit card number, the FTC warns that money can be debited from your account without your permission.
6. “You’ve been selected by a national foundation,” or “You’re a finalist.”
Some companies will contact you only if you approached them first. The FTC says legitimate organizations almost never seek out future winners; they want applicants to take the initiative.
If you think a scholarship or financial aid company is truly legit, do some extra research before inking a contract or sending in money, and keep these tips in mind:
• Don’t be pressured into anything you’re unsure about or worry you’ll miss your chance if you don’t act right away.
• Be leery of anyone who can’t or won’t answer your questions. Legit businesses will discuss their services clearly and openly.
• Scam companies often pay people to provide success stories. The FTC suggests asking for a list of recent clients in your area. Then talk to those clients yourself.
• Get everything in writing, including what’s included and not included in the company’s services, service charges and their refund policy.