Be Aware of Scholarship Scams
Unfortunately, every year many students and families fall victim to scholarship scams. Scam artists know a lot of students aren’t familiar with the scholarship application process and they take advantage of that fact. Always be cautious of any unsolicited scholarship offers.
Be especially aware of the following tactics used by scholarship scam artists:
- “You are a finalist for a scholarship contest.”
Most scholarship programs have application deadlines and you must meet certain criteria to receive the award. They do not resemble sweepstakes and other contests. There are a few very selective scholarships that teachers can nominate you for, but if you receive one of these awards you’ll receive notification directly from the financial aid office at your school. If someone claims you’re a finalist for something you didn’t apply for, and they want you to give any money or personal information, that’s a red flag it’s a scam.
- Someone tells you that you have won a college scholarship worth thousands of dollars, but they require you pay a “disbursement” or “redemption” fee before they can award your prize. Again, if someone says you won a prize and you didn’t enter the contest or submit an application, be suspicious. You never have to pay “disbursement” or “redemption” fees for scholarship awards.
- Scam artists may point out that you are not able to find this information elsewhere. Every opportunity you can apply for is going to be listed in many sources, including your high school guidance office, college financial aid office, and state and federal government agencies. Any super-secret awards are likely to be by invitation only, or by teacher nomination only, and you’ll receive notification through your school or teachers if these apply to you.
- Beware low interest educational loans requiring you to pay a fee before you receive the loan. When you pay the fee, the promised loan never materializes. Real educational loans deduct the fees from the disbursement check.
- “You must provide your checking account or credit card number.” If you’re asked for this information in exchange for “free” financial aid, you may be agreeing to terms and conditions that allow the company to charge you for certain services or items. Read any agreements carefully before you give payment information to anyone. Make sure you’re not signing up for expensive subscriptions or use fees.
- Watch out for any company that says “We’ll do all the work for you.” To apply for scholarships, you must submit your own essays and applications. You must ask your references for letters of recommendation. The process isn’t difficult; it just takes a little effort on your part. Besides, no one knows you as well as you know yourself. You don’t know how the company will represent you, and you might find yourself in a bad spot if they misrepresent you to a scholarship organization and you later have to backtrack or return funds. Save your money and apply yourself. It will take far less time than you think.
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