Quick Answer: Some debt relief programs are scams that charge illegal upfront fees for empty promises, as shown by the FTC’s complaint against Impetus Enterprise. The company charged around $500 for false claims like complete loan forgiveness in under 10 years, while legitimate federal programs offer the same services for free.
An offer of reduced monthly payments — or complete forgiveness — on your student loan may make you want to sign up…and exhale. Unfortunately, though, some of those programs wind up costing you hundreds or thousands of dollars for nothing in return. What’s more, you could’ve gotten real help for free.
Impetus Enterprise, Inc. and related defendants made such promises, according to a recent complaint filed by the FTC. The FTC says the defendants, doing business as Aidnest, Aiding Student Relief, and other names, deceived student loan borrowers by offering to get them reduced payments or even forgiveness on their loans. According to the complaint, the companies widely marketed things like complete loan forgiveness in under 10 years, which most borrowers are actually not eligible to get.
The FTC says people often paid around $500 to get student loan debt “relief,” based on what turned out to be empty promises. In addition, the FTC says that the companies charged those fees up front, which is illegal to do before actually helping people with debt relief. The FTC asked the court to put a halt to these activities and is trying to get money back to people.
Every weekday I read the enforcement actions, filings and fine print the outlets skip, and turn them into the one or two moves that actually improve your position — a rate worth moving for, a fee you can refuse, a deadline to beat before it costs you.
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This article by the FTC was distributed by the Personal Finance Syndication Network.
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Dealing With Debt? Understanding your options is the first step. See how all your debt relief options compare — including ones most sites won’t tell you about. The Find Your Path quiz gives a recommendation based on your actual numbers, and the Scam-O-Meter checks any company’s complaint history before you sign. Federal Reserve research shows bankruptcy filers recover faster than those who don’t file.
