Scams are popping up online that promise to help students get rid of their crippling loans — and it's making an already-bad problem even worse

Companies are taking advantage of students facing staggering student-loan debt by offering false promises to help borrowers relieve their debt, reported The Wall Street Journal .
Some of these companies are outright scams, while others are legal but shady.
With a national student-loan debt total of $1.5 trillion, borrowers are in a precarious position that makes them easy targets.
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Student borrowers are feeling the weight of student-loan debt .

The national total student-loan debt is over $1.5 trillion and the average student loan debt per graduating student in 2018 who took out loans is $29,800, according to Student Loan Hero .

But now, borrowers have another pressure to weigh when it comes to paying off their debt: relief scams.

Companies that offer the false promise of helping borrowers reduce or forgive debt are cropping up, Jean Eaglesham, Michael Tobin, and Coulter Jones reported for The Wall Street Journal .

Regulators told the trio that while some companies are scams or make illegal promises, others operate legally, but charge for services that could elsewhere be found for free. Many of these firms operate under several names, they wrote.

The Journal reporters found that borrowers featured on the website of one particular firm Financial Preparation Services appear in other variations on an additional 25 websites of "purportedly different companies offering student-loan debt-relief in the last four years." They reviewed a 2018 client agreement from Financial Preparation Services that charged $1,195 for document preparation and $40 a month for nearly 20 years amounting to $10,555.

That's a large sum that could otherwise go toward paying off debt instead.

The Federal Trade Commission has filed nine civil cases against alleged student-loan debt-relief scams in the past two years, including allegations of illegally charging upfront fees for debt relief, pretending to be government-approved, or falsifying application information, The Journal reported.

The growing burden of student-loan debt makes borrowers easy victims.

Borrowers are in a precarious position that makes them easy targets for relief scams as many as 40% of borrowers could default on their student loans by 2023, Business Insider previously reported , citing the 2018 Brookings Institution report .

Student-loan debt is even putting borrowers at risk of bankruptcy . A LendEDU study found that 32% of consumers filing for Chapter 7 bankruptcy carry student-loan debt. The study analyzed 1,083 individual bankruptcy cases from Upsolve , a non-profit that helps low-income consumers file for Chapter 7 bankruptcy.

Not only do students have to work hard to pay off their loans (and understand how to), they also have to be increasingly concerned about the legitimacy of how they're handling those payments.

Student-loan debt isalso causing many millennial borrowers to delay life milestones.

The Fed said earlier this year that exorbitant student-loan debt is why many young people can't afford homes . And in a survey for The New York Times , 13% of Americans aged 20 to 45 said they decided not to have kids because of student-loan debt, Business Insider's Shana Lebowitz previously reported .

Ultimately, student-loan debt makes it harder to save. In fact, nearly 50% of millennials who have or had student-loan debt think college wasn't worthwhile , according to an INSIDER and Morning Consult survey.