How to Avoid Scholarship and Financial Aid Scams

Going to college, trade school, or taking a certificate program is often helpful in moving up your career and earning more money, but it can also be expensive. Scammers take advantage of that by saying they will help you get financial aid or scholarships to pay your tuition bills. In reality, they are just trying to keep your money or steal your personal information.

What scammers promise

Scholarship and college financial aid scams often start with a social media post, email, or letter in the mail. It might look like a personalized invitation saying that you have been selected for a particular scholarship or financial aid package. Sometimes these invitations include a phone number to call or include details about an in-person workshop at a local hotel. But typically, these calls and events are high-pressure sales promotions where you are rushed to pay for services immediately, or risk losing these “special” scholarship or college financial aid packages.

Financial aid scams

Some companies claim that they can make you eligible for financial aid, including scholarships, loans, work-study programs, and other types of aid. These companies say that, in exchange for a fee, they will handle all the paperwork for the alleged program. What they are actually doing is submitting the Free Application for Federal Student Aid (FAFSA®), which is a free form that determines whether you are eligible for federal student aid. Sometimes scammers will use false information about your family’s income, assets, and benefits to qualify you for more assistance than you would if they told the truth.

In addition to losing money to these scam artists, you could also get in trouble, including fines of up to $ 20,000 and / or prison for any false information you provide on your FASFA form.

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Only you and your family can complete your FAFSA® form, which can always be completed and submitted free of charge. Never share your FSA or FSA ID (the username and password you use to submit the FASFA® form) with anyone, including companies and consultants. Dishonest people can use that information to log into your account and take control of your personal information.

Scholarship scams

Never pay to apply for a scholarship. If a company offers you a scholarship or study grant in exchange for a “processing fee” or “restitution fee,” or any other advance payment, walk away.

Many of these companies will give you nothing in exchange for your payment, not even a list of potential scholarship sources. Others say you have been selected as a “finalist” for a scholarship that you never applied for or for which you have to pay an upfront fee. Sometimes these companies ask for your bank account or credit card information to “confirm eligibility” and then debit your account without your consent. Some may offer a “money back guarantee” but have conditions on it that make it almost impossible to get a refund.

There are several legitimate companies that offer their scholarship lists for sale. Others may charge you an upfront fee to compare your profile to a database of scholarship opportunities and then provide you with a list of scholarships you may be eligible for. And there are also scholarship search engines on the internet. The difference is that legitimately operating companies never guarantee or promise scholarships or study grants.

Signs of a scholarship or financial aid scam

Not sure if an offer is a scam? These are some clues to determine it. If someone advertises an offer with some of the following phrases, or a variation of them, it is a scam.

  • Scammers say: “Scholarship is guaranteed, or your money back.”

  • Scammers say, “You can’t get this information anywhere else.”

  • Scammers say, “I only need your credit card or bank account number to reserve this scholarship.”

  • Scammers say, “We’ll take care of everything. You only have to pay a processing fee ”.

  • Scammers say, “The scholarship will cost you some money.”

  • Scammers say: “You are a finalist [de un concurso en el que jamás participó]”.


Some companies promote seminars where you can learn how to get scholarships and financial aid. Some are legitimate, but others are scams. Typically, these events are high-pressure sales promotions where you are told to pay immediately or risk missing out on the so-called “opportunity.”

If you are attending a financial aid or scholarship seminar, follow these steps:

  • Don’t pay anything at the seminary. Only scammers will tell you to pay now or risk missing out. Good opportunities are not sold with burdensome tactics like rush and high pressure.

  • Before paying, research the organization and other options. Do an internet search by entering the name of the organization along with words like “complaint” or “scam”; if you search in Spanish, use words like “complaint” or “scam”. Look at other people’s opinions. You may find that you can get the same help for free from a school counselor or financial aid advisor.

  • Don’t believe the “success” stories. The seminar operator may have paid those people to tell brilliant stories. Instead, ask for a list of at least three local families who have used the company’s services in the past year. Contact those families and ask if they are satisfied with the products and services they got.

  • Don’t do business with anyone who is reluctant to answer your questions or give you details. Legitimate businesses are more than willing to give you information about their services.

  • Ask how much you have to pay and what the company’s refund policy is. Get the full cost information and ask for it to be given to you in writing. Remember that scammers could make it difficult or impossible to get your money back, regardless of what they say in their refund policies.

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What to do if you are looking for a scholarship or financial aid

When you start looking for financial aid or a scholarship, follow these steps:

[ ] Fill out the free FAFSA® form to apply for financial aid, (this is the most important step in getting financial aid).

[ ] Never pay anyone to complete or process your FAFSA® form. That is likely a scam.

[ ] Talk to a school counselor (if you’re in high school) or the financial aid office (if you’re in college) about your financial aid and scholarship options.

[ ] Never pay in a seminary for financial aid or scholarships. Especially if they pressure you to pay. That is likely a scam.

[ ] Do your own research before paying someone for scholarship or financial aid assistance.

[ ] Share these ideas with others who are also looking for financial help. It can help them avoid a scam.

What to do if you paid a scammer

Scammers often ask for payment methods that will make it harder for them to get your money back. Regardless of how you paid a scammer, it is best to act as soon as possible. See more information on how to get your money back.

Report scams

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