November 12th, 2014 by schoolbound
Imagine this: You receive a letter from some national company informing you that you’ve been selected as a scholarship finalist, even though you can’t remember applying. All you have to do to secure your scholarship is fill out a form online, and cover the nominal cost of the scholarship taxes with a quick credit card payment. The company assures you that your scholarship check will be sent immediately upon receipt of your online payment.
WAIT! This scenario should have triggered loud alarm bells in your head. Did it? What would you do in this situation? Would you call your best friend to celebrate the good news while borrowing your mom’s credit card and paying the “scholarship taxes”? Or would you have the good sense to see through this scholarship scam?
It’s not uncommon for students to hear about great new scholarship programs that sound too good to be true. Immediately, students should question whether the promise of “free money for college” is “legit.” Various versions of scholarship scams have been around for a long time, and unscrupulous individuals are always eager to dupe unsuspecting students and families out of money and/or private information.
Be wise and follow these six guidelines for avoiding scams when seeking scholarships to pay for college.
1. If you don’t recognize the company name and if you don’t remember applying to the scholarship program, don’t blindly agree to accept the award.
It’s highly unlikely that a legitimate company will contact you and offer you free money out of the blue. At the very least, do some research on Google on the company or scholarship name. Pay attention to negative comments or complaints, and find out just what is being offered (and what is required from you) before continuing.
2. If you are unsure about what is being asked on a scholarship application, investigate before sharing any personal information.
Take a few minutes to read through the official scholarship rules, privacy policy, terms and conditions when applying for a scholarship. Pay attention to how your personal information may be used, and whether or not it’s protected by the scholarship provider.
3. Never agree to pay for a scholarship, even when the payment is supposedly being used for application fees or taxes.
Legitimate scholarships are provided to assist students in paying for college. With few exceptions (such as talent competitions and programs requiring portfolio reviews), scholarship providers do not charge fees. If you win a scholarship, you (or your school) should receive a check. Any other arrangement should make you highly suspicious.
4. Never provide your credit card number in exchange for the guarantee of a scholarship.
As noted above, you should be receiving money as the result of winning a scholarship, not being asked to “reserve” or “guarantee” your award.
5. Be wary of companies requiring a Social Security number at the time of application.
Your Social Security number is the gateway to your identity. Unless you are actually receiving money, you should not have to give it to a scholarship provider. If you do win a scholarship, you may be asked to provide your Social Security number as part of the proper reporting of the award to the Internal Revenue Service. You may find scholarship applications that request your Social Security number for validation purposes (e.g., to check your credit to make sure you are not delinquent on student loans). In these cases, we suggest you contact the scholarship provider and discuss your discomfort in supplying your SSN. Ask if you can be excused from providing it until such time that you win the award and they need it for tax or award verification purposes.
6. Don’t believe scholarship search companies that promise to find you a scholarship.
Because the search companies are not in charge of selecting scholarship winners, they cannot guarantee you will receive a scholarship. Companies making such promises are not to be trusted; steer clear.
For more information about how to protect yourself from scholarship scams, visit the Federal Trade Commission’s website: http://www.ftc.gov/scholarshipscams.