What Is Proof of No Income?

What Is Proof of No Income?

There are some circumstances that require a person to prove they have no income. Proving a negative is not as easy as proving a positive, but there are ways to do so. The following tips can prove useful.

Utilize the IRS by going on their website where you can download Form 4506-T which is a “Request for Transcript of Tax Return.” This will indicate all income for the previous year. You can also obtain information on W-2s or 1099s under your Social Security number. You can even obtain a Verification of Non-Filing Letter from the IRS. This would simply prove the IRS has no record of filed income tax forms.

A written statement that indicates no income can be used; however, it should be accompanied by documents that show no income from the previous year.
A person can write and sign a statement explaining there is no income, or there will be no income, or there will be a decrease in income along with an explanation of how and why the change took place.

Many students do not work and can easily prove their full-time student status through a current class schedule, transcript or acceptance letter. These documents will not show student income and need to be accompanied by a letter which explains no income due to being a full-time student and that the school document is being provided as proof of zero income.

Any documents from state or federal benefit agency that show zero income. These can be eligibility notices for food stamps or Medicaid for instance.

If zero income is due to the loss of a job, this can be proven by a termination letter or a notice of severance pay on your last paycheck stub. If job loss is due to company closure, you could have a notification letter provided by your previous employer.

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How does a lender verify income?

How does a lender verify income?

Buying a home is one of the most important and difficult steps many of us undertake as we try to get a foot on the property ladder. There are many parts to the process of buying a home, but one of the most important parts of obtaining a mortgage is going through the process of verifying income. It is important to remember the issue of verifying income can vary a little between different companies, but most use the debt to income ratio method.

Providing the correct documentation 

One of the first steps you will be presented with when looking to become prequalified for a mortgage is that of providing a lender with a series of documents related to your income. Lenders tend to ask for your last two paystubs showing total earnings to date to give an average of your current income. The majority of lenders will also ask you to provide W2 and tax returns for the past two years to gain an insight into your income history to decide if you are earning money over a prolonged period of time.

Why does a lender need this information? 

A lender wants to gain a solid overview of the income history of each person hoping to obtain a loan to make sure they are capable of paying the borrowed funds back. One of the most common ways a potential lender will make a decision about the possibility of approving a loan is through the debt to income ratio. This mathematic calculation gives the lender an overview of how much income is already being spent on the repayment of debt. Most lenders hope to keep this ratio at around 43 percent of the total income, but a well-qualified consumer may be able to obtain a mortgage with a 50 percent result.

The need to verify income is common in the mortgage application process and should not be feared. Getting your financial situation organized before starting the prequalification process is a good option to avoid any unforeseen issues.

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Do Car Dealerships Verify Income?

Do Car Dealerships Verify Income

Yes, is the short answer to whether car dealerships verify income. Car dealerships are prospective lenders. Therefore, they want to know if you can make the payments for the car you purchase. All dealerships go through a verification process in which they check to make sure you have a reliable income and are stable enough with your income or employment to make timely payments. Many dealerships work with outside financing companies, and they need as much information as possible to get you approved for the loan you desire. Some dealerships have in-house financing, but they still go through the same process they would go through even if they didn’t offer it.

It’s best to visit the dealership of choice with your information ready to be presented. You will need to confirm your income, the time you spent with your current employer and your address. You don’t necessarily have to have income from a traditional employer, but you must show that you make a consistent income that does not vary. Finance specialists will review your income and calculate the amount you can afford to pay each month. The lender will consider other factors such as your payment history and credit score before it issues its final approval.

The main purpose of the income check is to ensure that you do not get into a loan that you will struggle to repay. The lenders want to protect themselves as well as their customers so that everyone is happy with the purchase.

When you visit the dealership, you should bring at least four pay stubs. If you do not have regular employment, you can bring a statement from your social security, government assistance or other income sources. The agents will consider all the information you give them and will make their decision based on that. By bringing in the proper documentation, you can speed up the application and secure decent loan terms.

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Do Apartments Really Verify Income?

Do Apartments Really Verify Income?

Apartment hunting is exciting, but there are a few things you should know before you apply. The first one is that your income is very important. Apartment complexes verify your income as well as other factors. They want to know that you will be able to make timely payments each month for the rent so that they don’t have to go through expensive eviction processes. Each apartment complex is different. Therefore, one complex may have a more lenient verification practice than another one has. One complex may also have higher or lower minimum requirements than another one has, as well. It is up to you to do your due diligence and review several properties to see where your budget fits.

A leasing office is likely to ask you how long you’ve been working with your current employer and how much you make per paycheck or per month. They will want to see proof of the income you claim, and they may also verify your length of employment by calling your job or the toll-free number to verify your employment dates.

You may also have to go through a background check to qualify for an apartment rental. Another thing your prospective landlord may do is request a drug test. Property managers are now taking extra steps to ensure that they can have long-lasting tenants and as few court appearances as possible.

Before you apply for an apartment, you will need to clean up your financial profile as much as you can. You will need to check your credit score and try to raise it to a qualifying level. You can do that by ordering it and then reporting everything that doesn’t seem familiar. You can also pay down some debt or consolidate it. Try to stay on the job for at least two years to establish stability to the prospective landlord. Those steps will increase your chances of obtaining approval for the property you desire.

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How many types of fraud are there?

How Many Types of Fraud are There

 

Fraud is something that can be detrimental to any organization, debilitating its finances and possibly even ruining its viability. While many kinds of fraud exist, there are five that are especially virulent.

  1. Financial Statement Fraud

While not as common as some other forms, this fraud is still prevalent enough to note. This type of fraud involves bluffing about an organization’s revenue, earnings, assets, and liabilities. For recent examples of companies that committed this sort of fraud, one need only look up the long-gone entities known as “Enron” and “WorldCom.”

  1. Misappropriation of Assets

This is when people manipulate earnings, skimming off the top and intercepting income before it goes into the company’s coffers. This type of fraud is very hard to discover because there is rarely any paperwork to confirm the suspicion, making it one of the most commonly performed frauds. “Assets” can also include non-money elements of a company, such as corporate cars and the like.

  1. Stealing Intellectual Property and/or Trade Secrets

As information and technology continue to become dominant forces in the world, this sort of fraud increases in occurrence.

  1. Banking, Healthcare, and Insurance

These are three industries that involve billions of dollars. This is where false health and business insurance claims and faked bankruptcies fall.

  1. Consumer Fraud

Consumer fraud includes people being duped by a con man, unsavory telemarketers, phishing attempts, identity theft, e-mails of foreign princes seeking to transfer funds and so forth. Consumer fraud continues to be an issue, either due to the predatory behavior of a breached system or filing a false tax return that ought to give the thief a significant refund check. Companies can also be subjected to e-mail phishing scams; spear phishing, for example, is the practice of sending Trojan e-mails to employees in a business’ department in the hope that they click the dangerous links embedded within.

Fraud can take multiple forms and ruin an organization in a variety of ways that go beyond finances. Understand your vulnerabilities and work to strengthen them against fraud.

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