A reader wanted to know more about a company called Federal Student Aid Relief that operates a website (FederalStudentAidRelief.com) with a picture of a capitol building on the site.
The reader claims they did a bit of secret shopping as well and said, “When I called them I got a guy with a heavy New York accent who definitely implied that it was him, through his amazing powers, that would be getting the lower monthly payment – not that it was a free program through the Department of Education. He asked for my FAFSA pin and apparently accessed my student loan reports without permission. That part pissed me off.”
It does appear more of these student loan assistance companies are cropping up. I’ve covered a couple of them recently.
Federal Student Air Relief claims to be located at:
Federal Student Aid Relief
East 59 St.
New York, NY 10022 – Source
That’s not even a real street address. What building on East 59th Street?
The State of New York does not list any company registered to do business in New York under the name Federal Student Aid Relief.
The company lists its telephone number as 888-205-3616 and says they have been seen on CNBC, CNN, Fix News, and CBS News.
A look at the domain owner for federalstudentaidrelief.com could not identify the owner.
Unfortunately all of the claims the company makes, any consumer could achieve for free on their federal loans through the links below.
If anyone has used this company, please post your feedback about your experience below.
My concern is the company appears to be selling services consumers can accomplish on their own with the federal student loan servicer and there is no supporting information about who is really behind this company.
Update February 20, 2013
A reader sent me a copy of the client agreement that identified the company as Omega Capital Advisory, LLC.
This agreement is made between you, hereinafter called the “client”, and Omega Capital Advisory, LLC, doing business as Federal Student Aid Relief, hereinafter called “FSAR”. FSAR maintains operations in Brooklyn, NY and Boca Raton, FL.
According to State of Florida public records, Omega Capital Advisory, LLC is actually located at 1598 Dewey Ave, Bellmore, NY 11710.
The company managing member is Hercules Cotoulas with the address 215 78th Street, Brooklyn, NY 11209. – Source
The State of New York says Omega Capital Advisory, LLC was registered to do business on October 23, 2012 and the business is located at 1598 Dewey Ave, Bellmore, NY 11710. – Source
Update February 25, 2013
A reader sent me a copy of the client agreement from Federal Student Aid Relief. The agreement is below.
My observation about each section are in these quotes.
Congratulations on making the choice to responsibly manage your Student Loan Obligations. Our goal is to work with you to translate what can be a burdensome monthly obligation, into an affordable payment plan.
How do we accomplish this feat? By assisting you in taking advantage of the opportunities provided by the Department of Education to consolidate your many student loans, into a single, restructured loan arrangement.
How do we get started? This package contains everything you need to get started with our service. Please read everything, and make sure you ask us any questions you may have. You are entering into a contract for services, so you want to make sure you understand our arrangement.
The good news is that FSAR has done everything we can to make this process simple, easy and affordable.
What does this package contain? You will find the following documents:
Service Agreement (Exhibit A): This section contains important terms and conditions regarding our agreement. Please review this carefully as you are making a contractual arrangement, and sign at the bottom of the page
Limited Power of Attorney (Exhibit B): We will be working on your behalf with a variety of external providers qualified to consolidate Federal Student Loans. The last page is called a “Limited Power of Attorney” and it provides us with the opportunity to represent you in the application process. Please review this document and sign at the bottom of the page.
your Payment Schedule (Exhibit C): This document summarizes the cost of our service and provides you with an easy payment plan option. Please review this document,complete the requested payment information and sign at the bottom
What now? Send the documents back to us and we are off and running!
1. Your personal representative will share with you the information we need to complete your application. They will work with you to gather the data we require and select the best provider candidates.
2. We will then submit your consolidation application and package to the providers we believe will offer the best consolidation package.
3. Once we hear back, usually in 3-4 weeks, we will be back in touch with you to explain your options and discuss which option you believe will serve your needs best.
Just a few short weeks remain between you and the freedom of knowing you have responsibly
managed your student loans with a comfortable payment plan!
SERVICE AGREEMENT(Exhibit A)
You are entering into a legally binding contract for services. The following information represents the terms and conditions of our agreement. By executing theagreement, you are confirming that you understand, accept and agree to abide by these terms and conditions.
This agreement is made between you, hereinafter called the “client”, and Omega Capital Advisory, LLC, doing business as Federal Student Aid Relief, hereinafter called “FSAR”. FSAR maintains operations in Brooklyn, NY and Boca Raton, FL
1. Service Fees: The cost of services and your agreed payment plan are included with this agreement as EXHIBIT A: Service Fee Payment Schedule. By executing this agreement, the client agrees to pay these fees in full, and the client authorizes FSAR to charge the client’s credit card or debit their account according to this schedule. If for some reason, the selected payment method becomes unavailable, the client will be considered in default of this agreement until such time as the payment deficiency is cured and all work upon the client’s case will halt.
The client agreement did not have a fee schedule with it but it sounds as if there is more than one payment since the agreement refers to a payment schedule.
2. Authorization to proceed: By signing this agreement, the client specifically authorizes FSAR to work on their behalf to apply for and secure an offer from a Federal Student Loan Consolidation Provider.
3. Scope of Services: FSAR provides administrative services in support of Federal Student Loan Consolidation. FSAR will work upon a good faith basis to assist the client in submitting an application to a qualified Federal Student Loan consolidation program. FSAR will seek consolidation of the loans contained within EXHIBIT B: Your Eligible Loans. FSAR will only apply for consolidation of loans included within this list. FSAR will manage all communication and data information exchange with the provider, facilitate your application to the program, and work with the client to select an appropriate consolidation option. FSAR has completed their services under this agreement upon receipt of a response from the client on offer acceptance, and the transmission of this response to the loan consolidation provider, or if no response is received, five(5) days after the transmission of a consolidation offer. FSAR is not providing the client with legal, tax or financial advice of any kind. Further, FSAR does not make any promise or commitment to consolidate, or support the client in applying for the consolidation of any loans that would otherwise not be eligible for consolidation through federal student loan programs. FSAR is also not a provider and does not finance or re-finance student loans. FSAR and its officers, owners, employees, agents and affiliates make no representations or warranties of any kind as to the services to be provided herein.
4. The FSAR Money Back Guaranty: If FSAR is unable to secure a consolidation offer for your loan portfolio from a qualified provider within 120 days of entering into this agreement, FSAR will refund all fees paid under this agreement. Fees will be returned through the same method payment was received within 30 days of receiving your request for a refund, which must be made in writing to either the address above or through email to your account representative.
5. Client Responsibilities: FSAR will assist the client in making application to a Federal Loan Consolidation program. It is the client’s responsibility to provide FSAR with the information required to support their application with Federal Student Loan Consolidators, and to respond to FSAR requests with clear, accurate and truthful information in a timely fashion. Should the client not respond to a request from FSAR within five (5) days, the client will be considered in default, and the period of time available to FSAR to make the client an offer will be extended by the default period. To avoid confusion or disruption in the application process, the client also agrees not to engage in discussions with Student Loan Consolidation providers during the period of this agreement. Should the client provide deceptive, misleading or fraudulent information, the client agrees to hold FSAR harmless for any damages and liability that may accrue from the deception. Further, the client will be liable for any additional work incurred by FSAR on the client’s behalf as the result of the client’s misrepresentations.
Consumer agrees to not talk to their own lender. If the consumer does not respond to a request from FSAR within five days they will be considered to be in default.
7. Use of Information: FSAR will use the client’s personal information solely for the purpose of applying to Federally Qualified Student Loan providers on the client’s behalf. By signing this agreement, the client authorizes FSAR to transmit any of the client’s personal information to the providers and/or DOE for review and consideration through the application process. The client also consents to the provider receiving the application to utilize the information in a manner that supports verification and review of the client s application, including reference checking. FSAR maintains a client database exclusively for its own use which is limited to demographic information and does not contain any otherwise protected personal information.
8. Term, Terminatian and Default: The term of this agreement commences upon acceptance of by the client through electronic means or otherwise, and will remain in effect for one year, or until such time as the services are complete, the agreement is otherwise terminated by either party or the Client is in default. The client may be considered in default for a failure to complete payments as scheduled, or as the result of a failure to timely respond to an information request by FSAR. If the client cures the default within 60 days of FSAR communicating the issue to the client, the effort will proceed. If however; the default is not cured, this agreement is terminated. The client may also cancel this agreement in writing to the address listed above, or by email to their account representative. At the time of default or termination, all fees will be considered earned by FSAR.
There is no description of how long the services will take to complete. Will this be for the life of the loan as other providers have said? If the client is agreeing to a long-term future payment schedule and then cancels it appears they may technically be in default of this agreement.
If the client terminates the agreement all fees that would have been earned under the agreement will be considered earned and due.
There is no cancellation or refund clause for fees other than the initial fee.
9. Choice of Law, Venue and Conflict Resolution: Except as prohibited by law, the client and FSAR acknowledge their knowing and intentional waiver of their rights to a jury trial on all matters that concern this service agreement, as well as any other communications or matters related to the provision of services by FSAR to the client. This waiver is a material inducement for FSAR to enter into this agreement. If there is any dispute between the parties arising out of this Agreement, the parties agree to submit that dispute to binding arbitration. For all disputes, venue for such arbitration will be Palm Beach County, Florida.
Client waiver their right to a jury trial. Disputes will be by arbitration only in Palm Beach County, Florida and I suppose that will be at the consumers expense.
10. Electronic Communication: The client agrees that FSAR may send, and the Client may receive, in an electronic format, all information, copies of agreements and correspondence from FSAR. Client further agrees that FSAR may provide all evidence of transactions electronically. All electronic communications will be deemed to be valid and authentic, and the client agrees that those electronic communications will be given the same legal affect as written and signed paper communications. The client has the right to receive a paper copy of any of these electronic records, if applicable law specifically requires us to provide such documentation. Client’s consent may be withdrawn at any time upon iFSAR’s receipt of such withdrawal. Client acknowledges that internet communication is considered inherently insecure. Therefore, Client agrees that FSAR has no liability to the client whatsoever for any loss, claim and/or damages arising out of, or in any way related to FSAR’s responses to any electronic communication. At all times, client maintains the sole obligation to insure they can receive FSAR’s electronic communications and access them on a regular diligent basis.
11. Entirety of the Agreement: These terms and conditions and the associated exhibits represent the entirety of the agreement. This agreement supersedes any and all other agreements, representations or claims, whether written or oral, between the client and FSAR. The parties agree that the interpretation and/or severability of a single clause within this agreement does not impact the remaining covenants contained within this agreement.
Understood and accepted
LIMITED POWER OF ATTORNEY (Exhibit 8)
I hereby appoint Federal Student Aid Relief (“FSAR”), and its designated employees as my attorney-in-fact, and hereby permit the same to act in my own behalf to take such action(s) in connection with the following matter as may be advisable.
1. To investigate, obtain and review any and all information regarding my financial status including original documentation, payment history, balance, breakdowns and other pertinent details relating to my financial obligation(s).
2. To negotiate on ail Federal student loan accounts to achieve a reasonable resolution with any organization possessing an interest in my Federal student loan issues.
3. To represent me as allowed by law with regard to any matter within the scope of services set forth in the Service Agreement including, but not limited to communication with those organizations possessing an interest in my financial issues(s)
4. To prepare, complete and deliver any and all paperwork to those organizations possessing an interest in my financial matters on my behalf via mail or electronic submission with electronic signature.
5. Any other incidental acts that are reasonably required to undertake the authorities granted herein.
6. For no other purpose but those granted herein.
This Limited Power of Attorney shall continue in effect until I cancel this instrument in writing transmitted to FSAR, the terms of the service Agreement are fulfilled, or FSAR or I terminate the agreement, whichever occurs first.
In Witness Whereof, I have executed this Limited Power of Attorney.
Client Printed Name SSN
Client Signature Date
Drivers Lic. – Source
The agreement mentioned the company was in Palm Beach County, Florida.
The State of Florida does not list a company registered to do business in Florida under the name Federal Student Aid Relief.
There is however a fictitious name filed in Florida for Federal Student Aid Relief but as owned by Omega Capital Advisory in New York.
Update February 28, 2013
A tipster (send in your tips here) has sent in Payment Schedule C showing how the $699 fee is broken up in nine payments.
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