Scholarship Scams

Beware any scholarship-finding service claiming they can get you access to private scholarship money are available to fund a student’s education yet few know about so the money goes unused.

If only that were true! The sales pitch sounds great and it fools many people each and every year. A little homework on your part can help you avoid this common scam. Most financial aid, however, doesn’t come from private sources. Most college grant money comes from either the federal government or colleges and universities. We’re not saying there aren’t private scholarships, because some do exist but you have to qualify.

Who private scholarship grants target

Private scholarships are often targeted at a specific kind of applicant. Divorced homemakers over the age of 40 or children of Freemasons or students seeking theological training, for example. The groups and individuals providing these scholarships want students to use the money to go to school. That’s what it’s there for. What purpose would it serve to keep a scholarship secret?

That’s why you should suspect claims of being able to ferreting out unspent scholarships as being less than true. If the money is available, it will find its way to a student every time. If you think you may be eligible for a grant such as this, check into it by contacting clubs and organizations you or your family belong to. You should also make an appointment to see a financial aid counselor because they may be able to give you ideas on who to contact about scholarship grants. Whatever you do, don’t pay for scholarship lists. Information of this kind is freely available if you know where to look.

Beware of Scholarship-Finder Service Scams

It’s easy to see why so many people are duped by these scams each year. Families and individuals seeking colege money either don’t have the time or have no idea where to look for scholarships. People like these are ripe pickings for a scholarship-finder service. Don’t fall for their sales pitch and save the money you would have paid them on badly needed school supplies.

The Federal Trade Commission has published the following tips on identifying and avoiding scholarship scams.

How to spot a Scholarship Scam

According to the Federal Trade Commission warning on Scholarship Fraud, if you hear these lines from a scholarship service, you may be getting duped:

  • “The scholarship is guaranteed or your money back.”

    This is a promise that can’t be kept. The first red flag is that you need to send any of your money to get money. A guarantee is easy to make but harder to honor. If it’s an application you’re sending then it means you probably haven’t been granted the scholarship. If this is the case then how could someone promise it to you? Anytime someone makes you a promise that’s hard to impossible to keep you should be wary.

  • “You can’t get this information anywhere else.”
  • “I just need your credit card or bank account number to hold this scholarship.”

    This is a common scam tactic and anytime you hear these words you should question it. Once a scam artist has this information they can empty your bank account or charge purchases to your credit car. If you are unsure check with the Better Business Bureau or the Federal Trade Commission to make sure that who you are entrusting this information to is legitimate.

  • “We’ll do all the work.”
  • “The scholarship will cost money.” It is possible that a small processing fee may be required when you submit your application but it’s also an indication that this is a business or a scam and not real scholarship program. If you do send in a fee you will probably get nothing or very, very little. Some of these fraudulent scholarship businesses do award money but make sure they take in more than they give out. That’s why they are considered a for-profit scholarship program.
  • “You’ve been selected” by a “national foundation” to receive a scholarship or “You’re a finalist” in a contest you never entered.

    People are seldom contacted by scholarship programs in this manner. The way it usually works is that you send in the paperwork and then you are selected not the other way around. If you are contacted by someone claiming to be from a scholarship program and they ask you for your crdit card number or a fee it’s time to be skeptical. Do your homework before sending anyone anything.

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