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BBB: Don't pay for free advice on scholarships for college

Millions of people depend on grants and scholarships to pay for college.

Navigating the process of applying for financial aid can be confusing and some companies claim they can help, but only end up providing information and assistance the student can already get for free elsewhere.

The Better Business Bureau recommends doing your research before paying a company to find financial aid for college.

During the 2009-10 school year, $94 billion in grants was made available to college students to help cover education costs, according to The College Board. Sources of the funding included federal and state government, institutions, private entities and employers.

"Times are tight and many families desperately want to tap into the well of scholarships and grants to help their kids go to college," said Fred T. Elsberry Jr., president and CEO of the BBB serving metro Atlanta, Athens and northeast Georgia. "While some companies are trying to take advantage of struggling families looking for funding, the good news is that all of the information you need is already available for free."

Every year, BBB receives complaints from parents who paid money up front to a company that promised to find scholarships and grants for their child but ultimately didn't deliver.

One such company, Edifi-College Financial Aid, sends prospective college students a letter explaining they have been selected for a personal interview. Students who call for their interview are scheduled for a financial aid seminar along with other students and parents.

Complainants say they attended the seminar and later paid more than $1,000 for help finding aid, but the services offered were mostly assistance in filling out financial aid forms.

BBB is also receiving complaints about J.E.C.C., Inc. Complainants say they thought they were taking advantage of a free trial CD-ROM on how to get federal grants for college. Some were charged as much as $69 even before receiving the information in the mail and those who did receive the information complained that it wasn't helpful at all.

BBB recommends listening for the following red flags when receiving the sales pitch from a financial-aid finder:

• "The scholarship is guaranteed or your money back."

In reality no one can guarantee that they will get you a grant or scholarship. The refund guarantees that are offered usually have so many conditions or strings attached that it is almost impossible for consumers to get their money back.

• "You cannot get this information anywhere else."

Actually, scholarship information is widely available in books, from libraries and financial aid offices and on the Internet, if you are willing to search for it.

• "We will do all the work."

Only parents and students can really determine and provide the financial information needed to complete the forms.

• "You have been selected by a national foundation to receive a scholarship."

If you have not entered a competition sponsored by the foundation, this claim is highly unlikely.

• "May I have your credit card or bank account number to hold this scholarship?"

This is never a requirement for a legitimate scholarship offer.

• "The scholarship will cost some money."

Legitimate scholarship offers never require payment of any kind.

For more information on finding financial aid for school, visit www.fafsa.gov. BBB has advice for everyone on managing personal finances and avoiding scams at www.bbb.org/us/Consumer-Tips/.