Are Student Loan Forgiveness Companies Legit? How to Tell

Most companies that contact you offering student loan forgiveness for a fee are scams. You never have to pay anyone to apply for federal forgiveness programs — enrollment is free through your loan servicer or at StudentAid.gov.

Scammers exploit confusion — and the student loan system has never been more confusing.

On March 10, 2026, a federal appeals court ordered the end of the SAVE plan. The Department of Education has not yet told borrowers what to do next, and over 7 million remain in limbo. A new repayment plan called RAP takes effect in July 2026; the rules for existing income-driven repayment plans are changing, and IDR forgiveness is taxable again as of January 1, 2026. An estimated 9 million borrowers are in default as of late 2025.

When borrowers don’t know what they owe or what programs are available, scammers fill the gap — for a price. The CFPB received a record 22,900 student loan complaints in the year ending June 2025, a 36% increase over the prior year.

The result: you’re more likely than ever to receive a letter, email, phone call, or text from a company promising to help with your student loans.

The FTC has shut down multiple student loan forgiveness scam operations in 2024 and 2025. Each one impersonated the Department of Education, collected illegal fees, and stole millions from borrowers.

The pattern is the same across every case. The company uses an official-sounding name, promises forgiveness that no private company can deliver, and charges upfront fees, which is illegal under the FTC’s Telemarketing Sales Rule. The company then either files free government paperwork and charges hundreds of dollars for it, or does nothing at all.

• Superior Servicing (Nevada, 2024) — Impersonated the Department of Education through a network of shifting corporate entities, including Sunrise Solutions USA, Alumni Advantage, and Student Processing Center Group. The FTC’s first case under its new Impersonation Rule.

• Panda Benefit Services / Prosperity Benefit Services (California, 2025) — Stole over $16.7 million from borrowers by promising guaranteed forgiveness and fake enrollment programs. Used fake reviews and testimonials.

• SL Finance LLC (2023) — Charged illegal junk fees and falsely claimed affiliation with the Department of Education. Said their program was part of the CARES Act. The FTC sent over $356,000 in refunds to affected borrowers.

• BCO Consulting Services / SLA Consulting Services (2025) — Told borrowers they would take over loan servicing while actually pocketing the payments. The FTC sent over $743,000 in refunds.

• USA Student Debt Relief / Start Connecting LLC (Florida, 2025) — Owners permanently banned from the debt relief industry.

These companies used names designed to sound like government agencies — “Student Loan Debt Department,” “National Student Debt Forgiveness Center,” “Federal Student Aid Department.” None of those are real. The actual office is called Federal Student Aid, part of the U.S. Department of Education.

If a company contacts you about your student loans, check it against this list. Any one of these is a reason to walk away.

• They contacted you first. The Department of Education and your loan servicer do not cold-call, send unsolicited mailers, or text you about special forgiveness programs.

• They charge a fee — for anything. You never have to pay to apply for federal forgiveness programs, consolidation, income-driven repayment, deferment, or forbearance. Under the FTC’s Telemarketing Sales Rule, charging upfront fees for debt relief services is illegal. It does not matter how the company labels it — “processing fee,” “enrollment fee,” “service charge” — if they ask for money before they’ve done anything, they are breaking the law.

• They ask for your FSA ID or password. Your servicer and the Department of Education will never ask for your StudentAid.gov username and password via phone, email, or text. If someone gets those credentials, they can make changes to your account — including redirecting communications from your servicer to them.

• They guarantee forgiveness. No company can guarantee your loans will be forgiven. Federal programs like PSLF and income-driven repayment forgiveness have eligibility requirements and timelines that no one can bypass.

• They pressure you to act immediately. “Limited-time offer,” “program closing soon,” “your file will remain open for only one more day” — these are scam tactics. Legitimate federal programs have publicly announced timelines, not secret deadlines.

• They use an official-sounding name. Scam companies use names containing “federal,” “national,” or “department” to mimic government agencies. If you can’t verify the company on StudentAid.gov, it is not affiliated with the government.

• They ask you to sign a third-party authorization or power of attorney. This gives the company legal permission to make changes to your account and redirect all communication from your servicer to them.

Legitimate emails from the Department of Education come from only three addresses:

• noreply@studentaid.gov

• noreply@debtrelief.studentaid.gov

• ed.gov@public.govdelivery.com

Scammers disguise their email addresses to look similar — for example, using the number “0” instead of the letter “O,” or listing a bogus office location. If you receive an email about your student loans and aren’t sure it’s real, call the Federal Student Aid Information Center at 1-800-433-3243 to verify before clicking any links or responding.

There are three categories of real help for your student loans. None of them involve an unsolicited call or a fee to apply for a government program.

Your Federal Loan Servicer

The Department of Education contracts with private companies — federal loan servicers — to manage your account. Your servicer processes payments, helps you enroll in repayment plans, and handles forgiveness program applications. This is free. To find your servicer, log into your account at StudentAid.gov.

The current federal loan servicers are Aidvantage, Edfinancial, MOHELA, Nelnet, and ECSI. If a company contacting you is not on this list, it is not your federal loan servicer.

Free Nonprofit Resources

Free guidance is also available from nonprofits:

• The Institute of Student Loan Advisors (TISLA) — Free, unbiased guidance from student loan experts.

• Student Borrower Protection Center — Consumer advocacy and borrower resources.

• National Consumer Law Center — Student Loan Borrower Assistance — Legal resources and help filing complaints.

Student Loan Attorneys

If your situation involves complex issues — a PSLF dispute, a servicer error, a bankruptcy adversary proceeding, or a private student loan problem — a student loan attorney can help.

Legitimate attorneys don’t cold-call you. They don’t guarantee forgiveness. And they don’t charge fees for work they haven’t done. If an attorney promises to make your loans disappear for a flat upfront fee, that is the same pitch the scam companies use.

If you’ve already given money or personal information to a company you now believe is a scam, take these 8 steps:

1. Change your FSA ID password. Log in to StudentAid.gov and update your password immediately. Check that your contact information — email, address, phone number — hasn’t been changed.

2. Contact your loan servicer. Ask whether any third-party authorization or power of attorney has been placed on your account. If so, revoke it.

3. Stop payments. Contact your bank or credit card company to stop any recurring payments to the scam company. If you paid by credit card, ask about filing a chargeback to dispute the charge.

4. File a complaint with the FTC. Report the company at ReportFraud.ftc.gov.

5. File a complaint with Federal Student Aid. Use the Federal Student Aid Feedback Center.

6. File a complaint with the CFPB. Submit at consumerfinance.gov/complaint or call 1-855-411-2372.

7. Contact your state attorney general. Many states have consumer protection units that handle student loan scams.

8. Monitor your credit. If you shared your Social Security Number, check your credit report for unauthorized accounts and consider placing a fraud alert. If identity theft occurred, visit IdentityTheft.gov for a recovery plan.