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Education loan servicer shuts down, grads left in standard

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Karen Morris pays all her bills on time. Unfortuitously, that will not need assisted into the instance of her education loan.

The college that is former recently received a page from the FTC informing her that it’s freezing the assets of her education loan servicing business, Mission Hills Federal of north park.

“The Federal Trade Commission had been closing them down because they say it absolutely was a education loan scam,” she said.

The FTC claims Mission Hills took much more than $23 million from university grads like Morris, but then allegedly kept the amount of money and did not repay their student education loans.

But that is maybe not the worst part. Now the united states Department of Education informs her it will just just take her taxation return or garnish her wages to acquire the money she owes.

“Now student education loans wants to just take my taxation return,” she stated, “because I owe $2,000. Plus they are likely to just take my tax return this year”

Warning signs of a loan servicing scam

This isn’t an isolated case.

Loan servicing scams and loan forgiveness frauds target tens of thousands of students on a yearly basis. But there are approaches to protect yourself from the shady financial institution.

Just what exactly would be the indicators your lender may not be in the up or over?

The caution signs of that loan payment scam are:

  • Upfront charges to service your education loan
  • Promises of loan forgiveness (it’s very difficult to have that loan completely forgiven)
  • The business advertises on social networking
  • The business features a number that is high of in the event that you Google their title

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