CHICAGO, IL – February 17, 2011 – Millions of people depend on grants and scholarships to pay for college. Navigating the process of applying for financial aid can be confusing and some companies claim they can help, but only end up providing information and assistance the student can already get free elsewhere. The Better Business Bureau (BBB) recommends doing your research before paying a company to find financial aid for college.
According to the College Board, during the 2009-2010 school year, $94 billion in grants was made available to college students to help cover education costs. Sources of the funding included federal and state government, institutions, private entities and employers.
“Times are tight and many families desperately want to tap into the well of scholarships and grants to help their kids go to college,” said Steve J. Bernas, president & CEO of the Better Business Bureau serving Chicago and Northern Illinois. “While some companies are trying to take advantage of struggling families looking for funding, the good news is that all of the information you need is already available.”
Every year, the 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. In the past twelve months, there have been nearly 1,400 inquiries to the BBB about companies in the “Scholarships & Financial Aid” category in Northern Illinois.
One such company, Edifi-College Financial Aid, sends prospective college students a letter explaining they have been selected for a personal interview. Students who call for their interview are scheduled for a financial aid seminar along with other students and parents.
Deon Giles of Harvey, IL said, “I signed a contract for my son and they told me that I could cancel within 5 days. I cancelled in around 4 days but around two weeks later they took a payment from my debit card—the $300 that I had available. They claim that they have no record of me cancelling and said it would cost $500 to cancel! My mother has worked for the board of education for 30 something years and she told me that I could get the same information from other resources and not pay.”
The BBB recommends listening for these 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.” Scholarship information is widely available in libraries, 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.
For more information on finding financial aid for school, visit www.fafsa.gov; the BBB has advice for everyone on managing personal finances and avoiding scams at www.bbb.org
As a private, non-profit organization, the purpose of the Better Business Bureau is to promote an ethical marketplace. BBBs help resolve buyer/seller complaints by means of conciliation, mediation and arbitration. BBBs also review advertising claims, online business practices and charitable organizations. BBBs develop and issue reports on businesses and nonprofit organizations and encourage people to check out a company or charity before making a purchase or donation.