The application for student-loan forgiveness will become live in October.
The White House wants to ensure borrowers don't get tricked by scams during the process.
It released an updated guide on avoiding scams, including an outreach and education campaign for borrowers.
Student-loan borrowers will be able to apply for debt cancellation this month — and President Joe Biden wants to ensure they don't get scammed in the process.
Scams are not new to the student-loan industry. For years, fraudulent phone calls, emails, and texts have attempted to trick borrowers into giving money to a scammer under the guise of a credible loan servicer. While the Federal Trade Commission (FTC) has taken steps to prevent those scams, stakes are especially high for millions of borrowers right now. Biden announced up to $20,000 in debt relief for federal borrowers in August, and this month, the administration is planning to roll out an application that will allow borrowers to apply for, or opt out of, the loan forgiveness.
On Wednesday, the White House and Education Department released a debt-relief update, specifically geared toward preventing scams during the application process.
"One of the most critical ways to prevent scams and protect borrowers from being taken advantage of is developing a clear, simple, and secure site for borrowers to apply for debt relief and have the most up to date information from trusted sources, such as the Department of Education, Federal Student Aid, and other Administration agencies," a White House fact sheet said. "In addition to this work, the Federal Trade Commission (FTC) and Consumer Financial Protection Bureau (CFPB) have committed to working together to hold scammers accountable if they take advantage of borrowers."
Here are five ways the administration aims to help protect borrowers from scams:
Release a "Do's and Don'ts" list to outline actions borrowers should and should not take as the application for relief becomes available
The Education Department will regularly provide complaint reports to states that identify scams to allow the attorneys general to quickly act on the scammers
Coordinate with multiple agencies, like the FTC and CFPB, to analyze and report scams in real time
Launch outreach and education campaigns to borrowers to provide accurate information on student loans and avoid scams
Increase social media usage to communicate with borrowers by engaging with influencers and content creators to help spread accurate information on student-loan relief.
On Friday, the White House will also meet with leaders from the FTC, CFPB, and Education Department to discuss aggressive scam prevention strategies and encourages anyone contacted by scammers to report the incident to the FTC at reportfraud.ftc.gov.
Along with scams, Biden's debt relief plan is facing challenges from a number of conservative group that have filed lawsuits against the loan forgiveness, and the legal battles could push back the timeline for the application release and forgiveness. But the White House said it still plans to move forward with the process this month and has not publicly acknowledged any changes to its timeline.
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