ORLANDO, Fla. - A Deltona woman says she was burned for a thousand dollars by a company that promised to consolidate her student loans and save her money every month.
Action 9's Todd Ulrich found it's one of many debt relief companies that take students’ cash then deliver worthless services.
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A mailer offered a way out for Sandra Lehan to control her student loan debt.
The Student Loan Consolidation Reduction Plan could lower her loan balance by $22,000 and cut monthly payments on loans she took out for her nursing degree.
Lehan called the company asking if the offer was real.
“It was a definite yes and he was glad I called,” Lehan said.
First she had to pay a $1,000 fee to modify her loan. Then she kept waiting, but her monthly payment and loan balance never changed.
When Lehan called to complain, the company said her new lender was Navient. It's the provider she already had, so her loan terms remained the same.
“Did they do anything for you?” Ulrich asked.
“They only took a thousand dollars from me that's all they did,” Lehan said.
The company's actual name is Document Preparation Services and it's located in California.
It's rated F at the Better Business Bureau and there are other consumers claiming they paid for services that were never delivered.
Presis Yu is from the National Consumer Law Center.
The center's new research found most school loan offers are misrepresentations and regulators attempts to shut them down keep failing.
“There are so many companies and they're small, so it's like playing whack a mole. You shut one down, and five more spring up,” Yu said.
Numbers to the company Lehan dealt with continually ring busy and its website disappeared.
“I said you didn't do anything for me,” said Lehan.
Consumer experts recommend avoiding school loan offers with advance fees.
Stay away from companies offering to eliminate all your debt or any that charge to consolidate federal loans because students can do that on their own for free.
Check out studentloans.gov before you pay for any debt relief services.
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