Avoid scholarship scams

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By: John North

Better Business Bureau

Preparing to attend college is an exciting time, but it can also be stressful. Not only do you have to pay for tuition, but also housing, meal plans and supplies. Applying for scholarships and grants are a great way to help relieve this stress. Scammers use this to their advantage to target students and steal their money or personal information.

Scammers act as government or university officials and offer students money for grants or scholarships they didn’t even apply for. To collect this money, scammers ask you to pay a one-time “processing fee” and then never give you the money promised. Scammers also act as companies that assist in applying for scholarships for a fee and companies offering access to databases of scholarships/grants for a fee.

Some of these companies are legitimate, but you can often apply for the scholarships they offer on your own. If you need assistance finding or applying for scholarships, it’s best to contact a school counselor or financial aid official from the colleges you’re looking to attend.

Better Business Bureau offers the following tips to avoid scholarship scams:

Beware of unsolicited offers. You can’t win a grant or scholarship you didn’t apply for.

Consider it a red flag if you’re asked to pay to apply for scholarships and there are lots of spelling and grammar errors in the communication pieces. Likewise, be cautious if they claim to have exclusive access to scholarship information. All information about scholarships can be found free online. Lastly, be wary if they claim a high success rate.

Start the process early and allow yourself time to research scholarships before applying.

Ask questions. Make sure you understand the terms and conditions of the scholarship or grant. If a company or organization is dodging questions, it could be a red flag.

Complete the Free Application for Federal Student AID (FAFSA), which determines eligibility for all federal programs. Even if you don’t think you qualify for financial aid, fill it out. Many colleges and universities use it for non-need based awards. Visit www.studentaid.gov. Don’t fall for companies offering to fill out your FAFSA. Only you or a family member can fill out this application. Reporting false information in your FAFSA form could result in jail time or a hefty fine.

Be wary of phone calls or texts claiming to be your college financial department. Providing your personal information could result in your identity being stolen.

Beware of scholarships asking for your credit card or Social Security Number. Scholarships don’t need these to verify your identity or hold the scholarship.

Be skeptical of claims they are approved by a reputable organization. The federal government is prohibited from endorsing private businesses.

Be wary of scholarship offers that guarantee you’ll win. Legitimate scholarships are awarded based on performance or qualifications and can’t be guaranteed.

Don’t send a check for the excess if it seems you were overpaid. The scholarship check may be bogus and will bounce after you deposit it.

Trust your gut. If anything seems too good to be true, it probably is.

Scholarships and grants can be great ways to ease the stress of tuition for higher education. When applying for scholarships, remember to do your research. Visit BBB.org for a list of Accredited Businesses in the industry and Business Profiles for companies you’re considering. If you fall victim to a scam, report it to BBB Scam Tracker at bbb.org/scamtracker. You can also report it to the Federal Trade Commission, State Attorney General, US Postal Inspection Service, The National Fraud Information Center and/or the US Department of Education.

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