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How to Avoid Scholarship Scams

As you find and apply for scholarships and learn more about financial aid, you may come across some unsavory websites and scholarships that are scams. If you aren’t careful, these “too good to be true” scholarship opportunities will cheat you out of money and time. 

According to the United States Federal Trade Commission (FTC), students who come across a possible scholarship scam should report them to the FTC or to their state Attorney General’s office. 

Scholarship scams may look “official” and attempt to imitate the government or legitimate organizations. Other scholarship scams may offer to help students get money through the FAFSA or other legit financial aid applications.

However, there are some telltale signs that can help you avoid these scholarship scams.

Here are the biggest red flags that you should be aware of:

Keep on reading to learn more about these warning signs so you can tell whether a scholarship is legit or not!

Application fees

If a scholarship application requires you to send in an “application fee” or a “processing fee”, this is a major red flag. Legitimate scholarships will never ask you to send in any money! Scholarships that require an application fee will rake in tons of money and then only give a small percentage back in the form of a “scholarship.”

Related: Overview of common scholarship essay prompts

Paying for “special” access

If you come across a scholarship website that claims that they have “special” or “preferred” access, this should be a warning sign. Individuals claiming to have special access to scholarships are very likely misleading you. 

Applications that ask you for personal financial information

Similar to application fees, you should be wary of any application that asks you for any personal financial information. Any credible scholarship is not going to ask for banking or credit card information. 

Note that some legitimate scholarships may ask for information about the FAFSA. Students can ask a teacher, counselor, college access professional if they are ever unsure if a scholarship is legit or not.

Also see: Easy scholarships to apply for

“Guaranteed” scholarships

The last big red flag is any scholarship that “guarantees” you a specific outcome. Yes, some colleges will “guarantee” scholarships if you meet certain requirements for GPA and test scores, but outside scholarships that guarantee anything should be met with skepticism.

What should you do if you come across a scholarship scam?

So what happens if you do come across one of the above scholarship scams? What should you do?

First of all, you should not apply for the scholarship. If you are filling out an application and see an application fee, stop what you are doing. Don’t complete any more of the application.

You can also report potential scholarship scams to prevent other students from getting scams.

What should you do if you have applied to a sketchy scholarship?

If you find yourself in a situation where you’ve already applied to a scholarship that raises red flags, all is not lost. The FTC has some useful advice for students who may be victims of a scholarship scam. We highly recommend that you refer to the FTC webpage for next steps on how you can deal with scams. 

Bottom Line

Scholarship scams are real things that you may encounter when searching for scholarships. It is wise to be aware of the common tactics that these scammers use. In general, if something doesn’t feel right about a scholarship or if it seems “too good to be true,” you should trust your gut and do some further research. 

Next steps

One of the best ways to avoid scholarship scams is to conduct your scholarship search through vetted scholarship lists. Scholarships360’s scholarship search tool allows you to search our database of opportunities that are tailored to your situation. All of our lists are compiled by our staff of current and recent college students, and people with extensive experience in higher education.

Read more: How to start a scholarship essay