Did you ever give scholarship scams a second thought? Would you ever imagine that they even existed?
For most students and their parents, getting scammed while exploring scholarship opportunities is unthinkable. That is, until they get scammed themselves.
Getting scammed while looking for funding to realize your education dreams can be a crushing blow. The best way to avoid scholarship scams is by staying alert to them and recognizing the common red flags.
You need to pay money upfront as an ‘application fee’
No legitimate organization will ask for any money upfront as an application fee, processing fee, or for any other purpose. At the most, you may have to pay the postage if you are mailing your application. That’s it. Nothing more. If there are any fees to be paid, they will usually be added to your loan balance to be repaid over a period of time.
Services that are looking to make some easy money off students often ask for some amount of money upfront. This could range from a nominal amount of about $2 to $10 or thereabouts to as much as $5,000. Some explain it away as an application fee, others may call it an administrative fee. Still, others may say it is a kind of processing fee.
Whatever the name, asking for money upfront is unjustified. Best to strike that organization off your list or you can kiss your money goodbye as you will almost certainly never see that money again.
The service offers guaranteed scholarships or your money back
Guaranteeing a scholarship is one of the most common features of scholarship scams. Companies that offer this scholarship guarantee typically ask for a fee with a money-back clause. Both offers are scams.
No service can guarantee that they will get you a scholarship or a grant. Any legitimate scholarship scheme will have a few decisive factors, usually a combination of grade point average, volunteer service or work experience, professional interest or some other criterion. If you do not meet the laid down criteria, you would not be granted a scholarship. Again, no legitimate service will issue a scholarship guarantee.
As for getting your money back, if it is a scam to begin with, you can be sure there will be some clause in the fine print that not allow you get the money back so easily. You will find yourself fighting an uphill battle on this front.
You receive some kind of notification informing you that you won a scholarship you never applied for
Receiving an email or a phone call informing you that you’ve won a scholarship, it is a definite red flag. You cannot win a scholarship that you have not applied for. In most cases, the caller may ask for a processing fee or they may ask for your bank details so that the funds can be transferred to your account immediately. You will be given vague details about who the sponsor is.
The best way to deal with these unsolicited notifications is to simply delete all emails and texts from the sender or hang up on the caller. Never provide your personal or financial details to anybody without first verifying who is asking for this information.
You are promised access to exclusive scholarship information in exchange for your personal details
There is no such thing as ‘exclusive’ information when it comes to scholarships and any organization that makes such a claim, it is almost certainly a scam.
The two biggest financial aid providers are the federal government and colleges themselves. Then you have various private financial institutions and foundations that also offer scholarships. All of these entities want to promote themselves and provide detailed information on their websites. They are also happy to answer all queries by email or over the phone so the question of exclusive information does not arise at all.
You are required to submit personal information over the phone
If you get a call asking you for personal information in order to verify your identity or to confirm your eligibility, you know it is a scam. The caller is simply attempting to get information that they can use to apply for credit cards or to carry out some other illegal financial transactions using your name and financial details.
Legitimate scholarship applications do not require you to disclose your credit card number, bank account details, or your social security number upfront or at any time during the process. During the initial stage of the process, they are only interested in information that will help them determine whether or not you are eligible for the scholarship. If you are eligible, they may ask you for a few basic details so that the money can be transferred.
The service claims that they will do all the work for you
Applying for a scholarship takes a lot of work. Legitimate entities expect that applicants will put in the required effort to benefit from the ‘free money’ in the form of a scholarship. They want to read your essay and get a feel of the real you. No financial institution hires agencies to act as their middle-man, so don’t fall for this scam. If you want to get a scholarship, you also have to work for it. There are no shortcuts.
You are informed that the scholarship is open to everyone
Legitimate sponsors would almost never offer scholarships to just everyone who applies. Each organization may have a different set of criteria for selecting their scholarship recipients. However, they would never agree to sponsor ‘everyone’. Some may have academic accomplishments as their main criterion, whereas may prefer to sponsor gifted athletes or talented musicians. The criteria may differ but there will almost always be some set of restrictions that apply—be wary of those that don’t.
How to avoid scholarship scams
The best way to avoid getting scammed is to spend time doing your research into the different entities that offer scholarships and the different types of scholarship schemes that they offer. Also, don’t just restrict your search to Google. Teachers and other college students are an excellent resource for first-hand information on everything you want to know about scholarships. The more informed you are, the lesser the chances of getting scammed.
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| Lender | Rates (APR) | Eligibility | |
|---|---|---|---|
 |
5.50%-16.12%* Variable
3.99%-15.61%* Fixed
|
Undergraduate and Graduate
|
VISIT CITIZENS |
 |
5.54% - 15.70% Variable
3.99% - 15.49% Fixed
|
Undergraduate and Graduate
|
VISIT SALLIE MAE |
 |
4.63% - 17.99% Variable
3.49% - 17.99% Fixed
|
Undergraduate and Graduate
|
VISIT CREDIBLE |
 |
6.00% - 13.75% Variable
3.99% - 13.75% Fixed
|
Undergraduate and Graduate
|
VISIT LENDKEY |
 |
5.66% - 14.72% Variable
3.69% - 14.56% Fixed
|
Undergraduate and Graduate
|
VISIT ASCENT |
 |
3.70% - 8.75% Fixed
|
Undergraduate and Graduate
|
VISIT ISL |
 |
5.62% - 16.85% Variable
3.69% - 16.49% Fixed
|
Undergraduate and Graduate
|
VISIT EARNEST |
 |
5.00% - 14.22% Variable
3.69% - 14.22% Fixed
|
Undergraduate and Graduate
|
VISIT ELFI |
