The “special relationship” myth

Michael Lux Blog, Scam Alert, Student Loans 0 Comments

Lately I have heard many commercials for companies advertising “special relationships” that they have with the Department of Education. According to these commercials, the “special relationship” helps them save you money on your student loans.

This concept of a “special relationship” seems absurd for a number of reasons.

They never go into the details of the “special relationship”

A “special relationship” may sound like a great asset to a company, but what is it really?  Do they have someone with insider information?  Do they have former Department of Education employees working for them?  Do they work in the same building?  Does the Department of Education consider its relationship with the company to be special?

The point here is that the “special relationship” is something that sounds nice, but offers no substance.  If there was substance, wouldn’t it be even more persuasive to advertise that?

The Department of Education should not have “special relationships” with anyone

No single company should get a favored status when it comes to resolving the debts of their clients.  The repayment plans and programs that are put into place by federal law.  Even the interest rates on your loans are dictated by law.  It may seem like the lobbyists run Washington DC, but even they wouldn’t be so bold as to have laws or policies put into place that apply to just one company.

At best a “special relationship” means some knowledge and experience

Having someone with knowledge and experience to help you with your student loan problems is definitely a good thing, but it is still misleading to call it a “special relationship”.  If they are going to misrepresent something so basic, can you trust them on anything else?

The reality is that there are no secret programs with the Department of Education, nor are their “special relationships”.  The policies and procedures are public knowledge and if you just have to be willing to take a little bit of time an effort to investigate them.  There are many great free resources to help people with their student debt.  Don’t let a misleading advertisement be the reason your debt situation gets worse.  The student debt crisis has become a gold mine for companies looking to take advantage of people in hard times, use great caution before you part with any of your hard earned money.