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BBB is recommending doing your research BEFORE paying a company to help you find financial aid for college.
During the 2009 – 2010 school year, $94 billion in grants was made available to college students to help cover education costs, according to The College Board. Sources of the funding included federal and state government, institutions, private entities and employers.
Navigating the process of applying for financial aid can be confusing. Some companies claim they can help, but only end up providing information and assistance the student can already get for free elsewhere. Every year, BBB receives complaints from parents who paid money upfront to a company that promised to find scholarships and grants for their child but ultimately didn’t deliver.
One such company, Edifi-College Financial Aid, sends prospective college students a letter explaining they have been selected for a personal interview. BBB has seen these letters sent to local students. Students who call for their interview are scheduled for a financial aid seminar along with other students and parents. A local consumer says after signing up with Edifi, she tried to cancel the same day, and the company would not allow it. She says the company took money out of her bank account. Other complainants say they attended the seminar and later paid more than $1,000 for help finding aid, but the services offered were mostly assistance in filling out financial aid forms.
BBB recommends listening for the following red flags when receiving the sales pitch from a financial-aid finder:
· “The scholarship is guaranteed or your money back.” In reality no one can guarantee that they will get you a grant or scholarship. The refund guarantees that are offered usually have so many conditions or strings attached that it is almost impossible for consumers to get their money back.
· “You cannot get this information anywhere else.” Actually, scholarship information is widely available in books, from libraries and financial aid offices and on the Internet, if you are willing to search for it.
· “We will do all the work.” Only parents and students can really determine and provide the financial information needed to complete the forms.
· “You have been selected by a national foundation to receive a scholarship.” If you have not entered a competition sponsored by the foundation, this claim is highly unlikely.
· “May I have your credit card or bank account number to hold this scholarship?” This is never a requirement for a legitimate scholarship offer.
· “The scholarship will cost some money.” Legitimate scholarship offers never require payment of any kind.