With so many families looking for scholarship money to offset today's huge tuition bills, it's more important than ever to know the facts...
You see, the number of scholarship frauds and scam are ever-increasing, and the tactics used to separate families from their money have taken on new levels of deception. Knowing what to look for and how to avoid these scams can be your greatest protection.
Is the scholarship company making "too good to be true" claims?
Some college scholarships go as far as to claim they're sponsored by the Better Business Bureau, government agencies, or specific colleges or universities.
In fact, we've seen many fraudulent scholarship companies use names designed to trick families into believing they're federal agencies and organizations. (A common tactic is using a Washington, D.C. address to "appear" official and gain people's trust.)
Use great caution here, because no government agency endorses or sponsors any private organization. In short, the bigger the claim, the faster you should turn away. But if you do think the free scholarships are legitimate, by all means investigate their claims.
How long has the company been around? Does the company have proof of past winners it will share with you?
Most scholarships have been around for some time, and if they're legitimate – they'll answer your questions and provide records assuring their legitimacy.
(Note – not all "new" scholarships are frauds, but you should always ask new companies for references, and get as much factual information up front as possible.)
"Unclaimed Scholarship Money"
This tactic involves the scam artist marketing some huge amount of money – often in the millions or billions – that went "unclaimed" the previous year. Do not fall for this! Truth is, there's not a single legitimate scholarship search that has ever published a list of unclaimed scholarships.
Bogus application fees
Some companies will ask for "application" or "processing" fees, often citing very convincing reasons for doing so. The reality is, true loan and college scholarship resources will never ask for money up front. Bottom line: You should never pay a fee to apply for a scholarship.
"First Come, First Served"
This approach baits families into believing they'll increase their chances of scholarship money if they're among the "first in." This couldn't be any further from reality. Most times, it's a trick designed to get people to act quickly and impulsively. Legitimate scholarships simply don't give preferential treatment on a first-come, first-served basis.
The bottom line is, if it smells like a scam, there's a reason. Never be afraid to ask questions, get claims in writing, and do your research. A little extra diligence and some common sense can go a long way to protecting your money.
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