Identity Theft and Student Loans


By Bruce McClary

There are few people who have been untouched by the effects of identity theft. According to the latest data, nearly 100 million Americans are at risk of identity theft each year because their personal identifying information is compromised. It is also likely that many of those people are among the 40 million Americans paying back at least one student loan. Each year the numbers grow, placing even more people in the cross hairs of criminals.


It can be easy to overlook how identity theft impacts student borrowers since it is most commonly associated with credit and debit cards. The objective is to be alert to the signs of identity theft and be ready to take action when it happens.

Be Aware of Possible Ways an Identity Thief Can Take Action

One of the most damaging examples is when someone obtains a private student loan in your name. Despite the popular misconception that the proceeds of these loans are required to be used exclusively for school expenses like campus housing or tuition, the truth is that borrowers can spend the money on anything. This makes student loans an attractive target.

Victims may find out that someone has obtained a student loan in their name at a time when it’s too late. It’s best to be aware of the problem before a debt collector calls or when your loan application is rejected as you apply for federal student loans. This is where checking your credit regularly can come in handy. It’s easy to do and  free when visiting If left unnoticed, delinquent federal student loans can prevent you from receiving future tax refunds from the IRS and can also prevent you from obtaining federally insured mortgages.

Take Action as Soon as Fraudulent Activity is Detected

Once fraudulent activity has been identified, report it right away. The first step should be to notify the U.S. Department of Education Office of Inspector General Fraud Hotline if the situation involves a federal loan. It is also important to notify law enforcement as well as the three credit reporting agencies, Equifax, Experian and TransUnion. The Social Security Administration and the Federal Trade Commission should also be contacted.

What Information Should be Protected?

Prevention is the key to protecting your financial future, so be sure to keep a watchful eye on your credit report and do not share your FAFSA personal identification number (PIN) with anyone else. The same applies to your social security number (SSN) and other identifying information.  

Be sure to use different passwords for online accounts and follow password suggestions like including both upper and lower case characters, numbers and a special character when creating your passwords. We also recommend securing all of these important documents as well as a password list in a locked safe in your home.

Who is the NFCC?

Founded in 1951, the National Foundation for Credit Counseling® (NFCC®) is the nation's first and largest nonprofit dedicated to improving people's financial well-being.

NFCC members help millions of consumers like you through community-based offices located in all 50 states and Puerto Rico. Each NFCC member agency has earned our seal by adhering to high standards and ethical practices designed to help you achieve financial stability.

Member agencies are able to offer their services for nominal fees based on their current funding status. Funding for operations and services comes from an ever-changing combination of federal, state and local government grants, as well as donations from financial industry participants and private donors.

For more on the NFCC, visit

Thank you to our funders.

The Sharpen Your Financial Focus program is an initiative of the National Foundation for Credit Counseling (NFCC) in partnership with a broad cross-section of supporters. Together, we are committed to increasing the financial well-being of Americans. This initiative is partially funded by Bank of America, Chase, Synchrony Financial, Wells Fargo and other major financial institutions. We thank all funders and partners who make this program possible. For more information, visit

National Foundation for Credit Counseling
2000 M Street, NW
Suite 505
Washington, DC 20036

For NFCC Media Inquiries:
Bruce McClary
Vice President of Communications