Scammers are ‘on the move’ now that the student loan forgiveness application is live, warns FTC. Watch out for 5 red flags

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The Biden administration officially launched the application for federal student loan forgiveness Monday — and scammers are already “on the move” to capture borrowers’ money and personal information, the Federal Trade Commission warned Tuesday.

Tens of millions of Americans are eligible for debt cancellation. Borrowers may qualify for cancellation of up to $10,000 of federal debt, a sum that doubles to $20,000 for Pell Grant recipients, who are from lower-income households.

More than 8 million people applied for relief over the weekend during a short beta test period that began Friday, President Joe Biden said Monday.

But criminals are targeting borrowers both before and after they apply, the FTC said.

“As people file their applications, [the Education Department] will review them on a rolling basis,” the FTC said in a consumer alert. “Pack some patience and follow the process … not those who say they can put you in front of the line. Because those are scammers.”

Borrowers can apply for forgiveness no later than Dec. 31, 2023.

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5 red flags of forgiveness scams

Here are five red flags that borrowers applying for debt relief ought to watch out for, according to the FTC.

1. You’re not applying directly at

Don’t give your information to a third party offering to apply on your behalf. Apply directly at

Right now, the application is online only. There will be a paper application available at a later date.

2. There’s a fee to apply

Anyone who says you need to pay to apply is a fraudster, the FTC said: “And anyone who guarantees approval or quicker forgiveness: scam, scam, scam.”

3. You’re uploading financial documents

The real application is short and straightforward: It asks for your name, birth date, Social Security number, phone number and address.

When you apply online, you don’t have to upload or attach any documents such as past tax returns to prove income. Nobody “legit” will ask for your Federal Student Aid (FSA) ID, bank account or credit card information, the FTC said.

One important note: The relief is limited to those who make less than $125,000 per year, or married couples or heads of households earning less than $250,000. When the Education Department starts processing applications, some applicants will have to verify their income — but not at the time they apply, the FTC said.

4. Email updates come from an odd address

Once you apply for forgiveness, expect e-mail updates from the Education Department, the FTC said. The agency may ask you to upload tax documents verifying your income or may be giving updates on your application.

But the emails will only come from these legitimate senders:, or

Pay close attention the sender address, the agency said. Anything different from the above — even slight typos — are signs you’re getting a fake e-mail from a con artist.

5. Promises to help you qualify, for a fee

People who say they can get your debt relief approved, for a fee, are criminals, according to the FTC.

If your application is denied, “follow ED’s process,” the agency said. Follow the instructions on your email notice; if you have questions, call FSA’s dedicated phone line at 1-833-932-3439.

Sophie Tremblay

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