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Beware of FAFSA and Scholarship Myths and Scams

Searching for scholarships can be time consuming, but the reward can be great, especially if you gain enough scholarship money to help pay for college or reduce the amount of student loans you may have to borrow.

You may have received offers from individuals or companies to find scholarships or complete the Free Application for Federal Student Aid, the FAFSA, for you…for a fee. HESC urges students and families to be aware of the services for which you are paying when considering fee-based student financial aid services. Learn more about free federal and state college financial aid information.

Be aware of these common scholarship myths and scams:

Scam: We have the secret formula for getting more federal aid
The key to receiving federal financial aid is to complete the Free Application for Federal Student Aid – the FAFSA. Remember, the first word in FAFSA is “free.” You don’t have to pay for a service to prepare the FAFSA for you.

There are no secret formulas or sources of college aid, and the amount of aid you’ll receive, based on your financial need, is the same regardless of who completes the application. Completing the FAFSA is easier than ever before. Free FAFSA help is available at many community organizations throughout the State and at StartHereGetThere.org, HESC’s student financial aid awareness campaign website.

Myth: Millions of dollars in scholarship money go unclaimed.
In reality, almost all scholarships are awarded. As much as 85 percent of the “unclaimed” money is employer-paid education benefits that are not awarded because of highly restrictive requirements or timing.

Scam: We guarantee to get you scholarship aid – we’ll do all the work.
“If it sounds too good to be true, it probably is.” Keeping this old adage top-of-mind will help you determine whether to use a scholarship-finding service. Most scholarship search services match your profile to lists of available scholarships, probably from many of the same sources you can access freely on the Internet. Understand that most scholarship sponsors do not charge up-front fees to apply for funding, and no legitimate scholarship sponsor can guarantee you will win an award.

Myth: Only “A” students get scholarships.
Students with higher grades can compete for academic scholarships, but many scholarship committees look for more than grades. Some scholarship requirements may include involvement in community or extracurricular activities; others may require a particular skill or talent.

Myth: You need tons of community service and extracurricular activities to get scholarships.
Many scholarship winners have distinguished themselves with their dedication to only a few activities and have developed leadership skills within those programs. High-quality involvement with one or two activities trumps low-quality involvement in many. Quantity isn’t everything.

Scam: We need your credit card to “hold” your scholarship.
This is a red flag…do not give your credit card information over the phone or online to anyone without getting information about their service in writing first. You may be setting yourself up for an unauthorized charge or withdrawal, or worse yet, for identity theft.

Myth: Only the neediest students get scholarships.
While many scholarships are based on financial need, there are many other scholarships based on merit, academic interest, essays or by audition. The scholarship search engines on HESC.ny.gov can help you find them.

Myth: Scholarships will reduce the amount of financial aid I’ll receive.
You must report all scholarships or financial gifts you will be using for college when applying for financial aid. Receiving one or more scholarships may change the amount of need-based financial aid you receive. Conversely, receiving a scholarship may reduce your need for loans. Often, a scholarship has little effect on your total financial aid package.

You can learn more about scholarship myths and scams by visiting the Federal Trade Commission’s Scholarship Scams Web site.

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