Is the Obama Forgiveness Program real?

Ask the Expert: How To Get Out Of Student Loan Debt?

Question: I got an unsolicited email from the “Obama Forgiveness Program.” It said I could wipe out my $20,000 in student loans. I deleted the email, figuring it was just a scam. But now I’m, wondering: Is it? I keep seeing ads in my Facebook feed that say the government has programs to forgive student loans. But the ads aren’t from the government. What’s going on here? Is this a legit way to get out of student loan debt or not?

— Adam in Louisiana

Howard Dvorkin CPA answers…

Howard Dvorkin on how to get out of debt fastYou’re right, Adam — on all counts.

Yes, the federal government wants to help you pay off your student loans. And yes, scammers are using those government programs to steal your money.

Unfortunately, student loans are such a huge problem, there’s no simple way to help everyone. Americans owe more in student loans ($1.2 trillion) than they do on their credit cards ($847 million). The federal government has created five distinct programs, each with their own requirements and none of them very easy to navigate.

They range from the standard repayment plan (the most basic) to the graduated repayment program (which has nothing to do with getting a diploma) and will change the terms of your loan so your monthly payments won’t force you into default. Then there’s student loan forgiveness, which will wipe out your balance under very specific conditions — which start with choosing a profession for the “public good,” like firefighter or teacher.

Like filing your taxes without going to an accountant, you can apply for these programs by yourself. But just like your taxes, it can get confusing in a hurry. That’s why you’re seeing all those Facebook ads and getting all those emails, Adam.

Specialty businesses have sprung up to help you walk through the process. Of course, just like accountants, they want to be paid for their services — and just like accountants, their prices vary. Many are honest, but some are con artists. (Over the summer, NBC News reported on the “Obama Forgiveness Program” scam.)

How do you tell the difference between good and evil? First, never pay an upfront fee. Second, never pay thousands of dollars for a service that should cost a few hundred. Third, make sure the company has been around for a while and has good references and satisfied customers.

One reason I started was to partner with highly rated companies that will help Americans get out of debt without ripping them off. If you go the Student Loans page, you can fill out a free debt analysis and talk to a trained professional who will offer you all your options — and then you can choose. No high-pressure sales tactics, and no “Obama Forgiveness Program.”

Have a debt question?

Email your question to and Howard Dvorkin will review it. Dvorkin is a  CPA, chairman of, and author of two personal finance books, Credit Hell: How to Dig Yourself Out of Debt and Power Up: Taking Charge of Your Financial Destiny.

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