10 Tips On How To Spot Scholarship Scams

The existence of scholarships and grants that offer free money for students looking to pay for an expensive college education has, unfortunately, led to scholarship scams. Services, companies and programs offering these scams entice potential victims with the promises of a grant or scholarship in exchange for service fees or personal information that can lead to identity theft. Here are 10 tips on how to spot them:

1. You Need to Pay Money

Paying money to receive money does not make any sense at all. If a scholarship program or service is asking you for a large sum of money, while promising to give you back much more than you put in in terms of scholarship dollars, that should be enough to help you spot a scholarship scam. If the fee is a small amount, ask what it is for and if it can be waived. Legitimate, nonprofit organizations that provide scholarships should not be charging any type of fee. If they have money to give away, why would they need an extra $5 to process an application?

2. The Service is Pressuring You to Make a Decision

If a scholarship service is pressuring you to make some sort of fast-acting decision, it's most likely a scam. If a consultant from the service informs you that it is "first-come, first-served" or that it is a limited time offer, then you're being given a sales pitch to pressure you into giving them money in the form of a service fee without taking the time to stop and think about it.

3. The Promise of Rare or Unobtainable Information

Fake scholarship services will try to scam money from you by promising that the information they can provide you with cannot be found anywhere else. The truth is, there are numerous places where you can receive lists of scholarships available, and none of these lists will cost you a penny.

4. Requests for Personal Information

If you are called or contacted by a scholarship services requesting personal information like a Social Security Number, bank account number or credit card number, it is most likely a scam. They may try to convince you that it is for eligibility purposes or to confirm your identity. Unless you've received an information packet in writing and can confirm that the service is legitimate, don't give out any personal information.

5. The Service Will Take Care of Everything

The fact of the matter is, the student must do virtually all of the work to obtain a scholarship or grant. Scholarships will be asking for an application, personal essay and letters of recommendation. How is a scholarship service supposed to do all of that? There is no easy way around it, if you're receiving free money, you will be the one doing all of the work.

6. You are Guaranteed a Scholarship

There is no way a scholarship or grant can be guaranteed, either from a scholarship sponsor or a service. Sponsors can never guarantee a single person will win a scholarship, and scholarship services cannot control the sponsors who are making the decisions.

7. You are Contacted About a Scholarship You Never Applied For

If you are contacted about a scholarship you never applied for, or for winning a contest you never entered, you are most likely dealing with a scam company. These companies may sound legitimate over the found, or they may send documents and pamphlets that look convincing, but as soon as they ask for money or personal information that can lead to identity theft, don't do a thing until you can confirm they are legitimate.

8. Questionable Address

Look up the address of the service or program that is offering scholarships and confirm it is a legitimate address. If you find that their address is a residential address or a mail drop, you are dealing with a scam. Also keep in mind that there is a possibility that the scam service has set up shop in a real business plaza. The business address should not be your only form of confirmation that it is a legitimate service.

9. Fake Reviews

In most cases, a review site on the internet is not enough to confirm the legitimacy of a company or service. It is fairly easy to post false reviews that shine a positive light on a scholarship scam. Often times, these reviews will show the first name and last initial for a fake person in a random part of the country. There could be dozens of these fake reviews posted everywhere. If you carefully read each one, you'll notice they all sound the same. In most cases, a review site with nothing but praise for a company or service is the sign of a scam.

10. Trust Your Instincts

The moment you feel that something sounds fishy about a scholarship offer or service, start asking questions or do your own research to find out if everything is legitimate. You can often spot these scams by the wording they use over the phone or in their written documentation. If it sounds like a sales pitch, it is most likely a scam. If you notice a lot of typos and grammatical errors, it is most likely a scam. If it is a new company, it is most likely a scam. Sometimes, all it takes is your natural instincts to help you spot scholarship scams.