My dad got a voice mail talking about a loan forgiveness program. He has no loans left, but I do, so we assume that they're trying to get a hold of me. I Googled the number from the message and nothing popped up (other than info behind a paywall). Since I had some free time I decided to call. The person who picked up sounded American. When he asked how much I have for loans I gave him a vague "Significant amount" and further stated that I don't know who he is. Instead of pressing the issue he directed me to look up the William D Ford Direct Loan Program and gave me his number (info is also behind a paywall when I Googled that number).

The Google results about the program brings up several .gov sites plus a Wikipedia entry and everything seems to check out. However, given the vast amount of spoofing and robo spam calls, one can never be too cautious.

Is the program legit? If so, is it a good program? I currently use Nelnet and have a decent repayment plan. The guy from the Ford Program made it sound like I wouldn't be switching to something very different.

  • Did the guy say that the William D Ford Direct Loan Program will forgive loans? – RonJohn Dec 2 '19 at 20:44
  • Yeah, though in the brief rundown he said that it's essentially a consolidation that lengthens the term (10-20 years) and decreasing the monthly payment. Assuming that payments were on time, at the end of the term the remaining balance is forgiven. If I were to work for a nonprofit, the term would be 10 years then forgiveness, like regular loans do. – Lux Claridge Dec 2 '19 at 20:47
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    Consolidation loans are normal and legitimate but it's very sketchy for them to "direct you to" a Government website. Consolidate if you want to (though that might cause you to lose some protections granted by federal loans), but I would NOT deal with this company, since they're deceitful cold-call salesmen. – RonJohn Dec 2 '19 at 20:56

The William D Ford Direct Loan Program is usually just referred to as 'Direct Loans', which covers several types of federal student loans: Direct Loans, Direct Unsubsidized Loans, Direct PLUS Loans, and Direct Consolidation Loans. Nelnet is one of the major federal student loan administrators, so your loans are most likely already under the Direct Loan Program.

The fact that someone reached out directly seems odd. Yes the words they said may be correct, but the question is what did they want from you and why did they initiate? If you are interested in different repayment options, you should call Nelnet to discuss directly with them.

The Federal Student Aid site says:

How do I apply to have my loan forgiven, canceled, or discharged?
Contact your loan servicer if you think you qualify. If you have a Perkins Loan, you should contact the school that made the loan or the loan servicer the school has designated.

From the initial context it sounds pretty scammy. From your follow up comment about consolidation it could be a legitimate service but consolidating can be a bad idea (especially from a company cold-calling potential clients). If you are having problems repaying or paying very high interest rates, investigate consolidation with your loan servicer and/or known companies. If you are on income based repayment consolidation can reset forgiveness timers, so watch out for that.

  • Yeah, that just occurred to me, that they could say they're part of the Direct Loan Program but not actually. – Lux Claridge Dec 2 '19 at 20:44
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    Besides, who calls up out of the blue and says, "we'll forgive your student loans"? It just doesn't happen. – RonJohn Dec 2 '19 at 20:46

They're lying about being with William D Ford.

It's no different when the "virus on your PC" scammers claim they're with Microsoft.

You can tell, because when you googled their callback number, it didn't pop up an official William D Ford website, and it didn't pop up an 800notes.com page with 5 years of entries saying the number is legit.

They're probably a scammer, obviously

The best you can hope for is they are a lead generator. They drag enough out of you to confirm that you do in fact have debt and are in the market for a debt consolidation loan, and then, they sell your name to companies that actually do offer debt consolidation loans (at a ripoff price, no doubt; when they seek you out, it's a raw deal).

The worst, of course, is they're out to steal your identity. I hope you called them on a burner phone, otherwise your phone number may now be on a sucker list.

Whether William D Ford is legit is pretty irrelevant

Because these guys aren't them. Ford has no relationship with you and hasn't called you. You could try cold-calling them, but you really, really ought to use a number you get yourself off Ford's official website, not - never! - the number the scammer gave you.

Obviously the scammer is trying to exploit Ford's good reputation to give you trust in them. Don't get confused!

It's just like when the guys call about the virus on your computer and say they are from Microsoft. They're not from Microsoft.

  • Re: the burner phone. 10 years ago I would agree with that sentiment but the vast amount of spam calls make it a moot point anyway. At one point I was getting 10 calls a day. – Lux Claridge Dec 3 '19 at 14:11

If it's a "legitimate" company offering a refinancing option, you can avoid such calls for him by putting his number in the donotcall.gov registry.

But welcome to the world of VoIP where anyone can get a phone number in any country, and have a bot or a human work on randomly dialing people to exploit, since a near zero success rate will easily pay more than the costs of running the scam.

Did they want to refinance or were they asking for a payment? How were they asking to be paid, if so?

Banks and credit card issuers should reverse fraud charges (or even deceptive or unsatisfactory ones).

But if they ask for cryptocurrency you know its a scam. The blockchain can be as anonymous as a phone number bought, or gotten for free, online. However, its immutable and charges can't be reversed.

I decided to post this as an answer because the more successful exploit is to claim they are calling from the company that the OS runs, or the company that makes some software he likely runs.

The scam is to fix a non-existent problem, by tricking him into installing something that encrypts all data. Once the caller hangs up, you'll be left with a countdown on your screen with a address requesting an amount of Bitcoin in exchange for the decryption key.

These are honest scammers, who target older people. They're honest in that, the timer is real, usually just long enough for someone to figure out how to buy and send Bitcoin, and once paid a decryption key will be given.

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