Beware of College Scholarship Scams

Avoiding Scholarship ScamsDifferentiating between the illegitimate and legitimate scholarship opportunities might be a confusing and overwhelming task for the students. According to recent reports, every year, around 400,000 families and students have fallen victim of scholarship scams and this cost them more than $5 million annually. With the given debt situation and the soaring student loan debt in the US, free scholarship money will always sound great to all those students who are going through dire financial straits and are desperately looking for immediate financial help from the debt relief programs. But during such hapless situations, there are students who accept offers that are too good to be true and it is then that they start falling deeper in the financial mess. If you’re a student who is looking for college scholarship options, you should be aware of the scams that surround this particular industry so that you don’t let them hurt your trust. While conducting your research for the scholarship opportunities, be on the lookout for the scams mentioned below.

Scholarships that demand upfront fees: If you come across a scholarship that asks you to send them an application fee or processing fee, this is not an actual scholarship and in all probabilities, it’s a scam. Even though the scholarship offer might add a disclosure statement promising a refund, you should always know that the money that you send as the upfront will never be returned and that demanding the application fees is perhaps the most common scams that have been deceiving students every year.
Scholarships that promise rewards without entries: Have you come across ads that say “Congratulations! You’ve just won a $10,000 to college! Please send $200 as processing fee to get the reward”? If you haven’t applied for the scholarship and you haven’t entered in a contest for getting this money, this is in all probabilities a scam company. You shouldn’t ever send in any amount of processing fees to a questionable source without any kind of entries. Remember that scholarships award you for outstanding achievements, not prize money for just doing nothing.

Scholarships that offer free seminars: You may get an invitation in your mailbox where they’ll coax you to attend a free seminar where people will offer you advice on financial aid. This might sound to be appealing for a student who is a novice with the student loan debt trap, but this, in most cases is a scam. Instead of offering you with enough information that can boost your knowledge, this seminar will soon become a sales pitch that will try to sell investment products, annuity and insurance programs. Even worse, such seminars will rope students into accepting over-priced student loans.

Scholarships with no proof of past winners: When you’re getting a particular scholarship, there must have been past winners who have won this scholarship before you. You can Google the information and look for evidence of all the past winners. If you don’t find any history of the scholarship, this is certainly a scam. But this might not be the case with the new scholarships.

Scholarships that require personal information: You should be aware of the fact that it is completely irrelevant for a trustworthy scholarship provider to ask you about your bank account details, credit card details or even your Social Security number. If you get a call regarding college scholarship and you see them asking for the aforementioned details, you should tactfully avoid them in order to avoid aggravating your stress. Of course, when you are applying for need-based scholarships, you will often need to provide proof of financial need via your Free Application for Federal Student Aid (FAFSA) form. Check with the college’s financial aid offices for more details, rather than blindly releasing your records to dubious individuals
After reading the above-mentioned concerns of this article, you shouldn’t be discouraged as there are thousands of other legitimate scholarships that are dedicated to helping you pay for college and avoiding college debt. Remain cautious of the offers that seem too good to be true.