The U.S. Department of Education and Federal Trade Commission have jointly released a consumer guide to help students and their families navigate the maze of offers they may face when seeking new student loans or consolidating existing student loans to pay for higher education. Student Loans: Avoiding Deceptive Offers provides advice to help consumers detect deceptive marketing offers from private companies seeking their student loan business.

"As we carry out our commitment to ensure the availability of federal student loans, we must also make sure that students and their families are armed with critical information to help them recognize and avoid deceptive lending practices," said US Secretary of Education Margaret Spellings. "This brochure will help families be wise consumers of higher education and financial aid, and I am pleased that my Department and the FTC collaborated on this timely effort."

The free brochure is available at http://ombudsman.ed.gov/hottopics.html and provides comprehensive, useful information to students and families about the different benefits and terms of federal and private loans as well as offers tips and advice on recognizing questionable practices, including:

• Names, seals or logos similar to government agencies used by some lenders and marketers to create the false impression that they are part of the federal student loan program;

• Requests by phone, mail or over the Internet for personal account information, such as a Social Security number or Personal Identification Number;

• Solicitations and advertisements for student loan business;

• Promotions, sweepstakes, and gift offers intended to attract business and divert attention from a thoughtful assessment of the terms of the loan being offered.

The new brochure includes several resources for information about student loans and filing a complaint against various types of lenders. In addition, it includes a section on identifying potential problems related to loan consolidation, such as:

• Be wary of lenders that use high-pressure techniques such as "your interest rate may go up unless you consolidate immediately;"

• Know whether your loans have interest rates that are fixed or variable;

• Be cautious about consolidating federal and private loans into one private loan, or including a Perkins loan when consolidating;

• Read the fine print on offers from lenders to lower the interest rate on your consolidated loan, as these may be tied to automated payments, a specific loan balance, or on-time payments for the life of the loan, and may change if the lender sells your consolidated loan to another company.

In addition to the new brochure, the U.S. Department of Education and the Federal Trade Commission have worked together for more than 10 years to educate the public to recognize and avoid scholarship scams.

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