How would I know if someone stole my identity?

How would I know if someone stole my identity

Once an identity thief has your personal information, he or she can run wild with it. By recognizing the signs of identity theft, you can take immediate action to protect yourself from any further financial damage or harm to your reputation. Keep these top warning signs in mind as you safeguard your personal and confidential information.

Unusual Account Activity 

An identity thief might start to use your credit or debit card information to make cash withdrawals or purchase goods. You might log into your account and discover mysterious debits or charges at places you do not patronize. You might find that your shipping address has been changed to some other address. You may stop receiving mail related to your longstanding credit cards or bank accounts.

Accounts You Do Not Recognize 

Once an identity thief has your personal information, he or she could use it to open new accounts in your name. You can find this by checking your credit report. You might also notice new mailings about credit cards or lines of credit that you never applied for. Debt collectors might start to call you for accounts you never knew about.

Service Refusals 

If an identity thief attempts to use your medical insurance, you might start to get bills for services you never received. When trying to buy a new insurance plan, you might be denied due to a condition you do not have. This could happen if someone else has been using your identity to get treatment.

Legal Notifications 

Someone could steal your identity and file false tax returns with the state tax department or the IRS. You might get a notification from the IRS that you were already claimed as a dependent. The IRS could send you a letter stating that you earned income from an employer where you have never worked. You might get property tax bills, liens or utility bills for places where you do not and have never lived.

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What can be used as proof of income?

What can be used as proof of income?

When you apply for a loan, whether it’s a car loan, a mortgage or a personal loan, the lender generally will require you to show proof of income. The lender does this because it wants to be sure you can afford the monthly payments and be able to pay the loan back in full. There are a few different ways you can prove your income, and a lender may require you to provide more than one document.

Pay Information
One of the easiest and most common ways to prove your income is to provide income on your pay. If you work at a regular job, one or two of your most recent pay stubs may be enough to prove your income to your lender. If you work as a contractor or freelance worker, you may be able to offer a payroll schedule or a letter from the person or company who employs you.

Tax Returns
Lenders often ask for income tax returns as proof of income. Unlike pay stubs, which show the income you are making over a couple of weeks or a month, tax returns show your income over a longer period of time, which shows whether your income is stable or not. Many lenders ask for both recent pay stubs and a year or two of tax returns.

Bank Statements
Another document that a lender might ask for to prove income is a bank statement. If you are receiving your income from an annuity or some other investment vehicle, a bank statement can show that there are regular deposits that have continued over a long period of time. If you have earnings directly deposited into your bank account, this will also show up on your bank statement.

Proof of income is just one level of due diligence a lender will do before approving you for a loan. You should be prepared to undergo a thorough vetting that may take a few days.

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How is a line of credit different from a loan?

How is a line of credit different from a loan

Many consumers looking to borrow money wonder whether they should go with a personal loan or a line of credit. While both lending products have similarities, the way they work is quite different.

A line of credit is seen as a more flexible borrowing solution. It works in a way similar to a credit card, as you have a fixed limit on how much you can borrow. When you get a line of credit, you can draw any amount up to the limit in various ways. The most common one is by writing a check, but many financial institutions also provide you with a credit or debit card that is tied to your line of credit.

As a line of credit is a revolving loan product, you can repay any part that you’ve used and draw on it again. You don’t need to make any payments unless you use your line of credit. The minimum amount that you have to repay and the interest charges associated with the line of credit will vary from one financial institution to the next. A line of credit is a good solution for those seeking a flexible credit product that they can use whenever they need to.

When you get a personal loan, you receive the entire amount of the loan as soon as it’s approved. This also means that you’ll start paying interest on the full amount of the loan as soon as you’ve obtained it. You pay off the loan in installments based on a schedule that was set at the beginning. The term of the loan varies but is typically between one and five years. In most cases, you’ll make the same payment each month, which reduces the amount that you owe the lender until the loan has been paid off in full. In most cases, lenders also allow you to make additional payments or pay off the loan early.

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How Does a Bank Verify Employment?

How Does a Bank Verify Employment?

When you apply for a mortgage or another type of loan, the lender will typically need to verify your employment before they can approve you. Along with contacting your current employer, lenders will also want to verify any documentation you have on your income. Before a lender is able to contact your employer, however, they will need you to sign a form that authorizes them to get specific information from your employers such as your income information and details about your employment.

Lender Obtains Necessary Information 

Like stated earlier, the lender you are applying with will contact your employer to get your income information as well as the likelihood that you will continue working there long-term. For borrowers who have been at their place of employment for less than two years, lenders may also want to check out their previous employment as well.

Typically, lenders will verify information in a verbal manner with their borrowers after they have filled out a Uniform Residential Loan Application. However, they may decide to send the information through email, fax or between all three methods. Once a lender has received all pertinent information from a borrower, they will use that information to figure out the likelihood that a borrower will be able to repay a loan both in full and with on-time payments.

If there is a change in a borrower’s employment status from the time they first apply up until the lender makes their decision, it could have an impact on whether or not they get approved for the loan.

Self-Employment Income Verification 

In some cases, it may be a little more difficult for those who are self-employed to prove their income when trying to apply for a loan. For this situation, a lender might require a specific form from the IRS to be filled out. The form is necessary for a lender to be able to request a “Transcript of Tax Return” from the Internal Revenue Service for your previous returns. In addition to previous tax returns, lenders may need to contact an accountant to help them confirm the strength of your business and viability of your income in regards to your ability to repay a loan.

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How Do You Qualify for a Small Business Loan?

How Do You Qualify for a Small Business Loan?

You’ll need capital to cover expenses like product inventory, payroll, insurance and advertising when starting a small business. While drawing money from your personal savings is an option, most entrepreneurs lack the cash on hand to launch their business. Thankfully, there are loans available, but you’ll need to follow some steps to increase your chances of getting qualified for one.

Improve Personal Credit

When you apply for a small business loan, the lender will check your credit score and history. If you have bad credit — defined as a FICO score of 300 to 599 — you’ll struggle to get qualified for a loan. To build and improve your personal credit, use credit cards to make purchases instead of cash or debit cards. And when you receive the bills, pay as much as you feasibly can to keep the balances low.

Improve Business Credit

In addition to looking at your personal credit score, lenders will also look at your business credit score. Rather than using FICO, however, business credit reporting bureaus, including Experian and Dun & Bradstreet, use their own internal scoring system. The former uses Intelliscore Plus while the latter uses PAYDEX, both of which range from zero to 100. You can build your business credit by using credit cards in your business’s name to pay for expenses. Like personal credit cards, though, you should keep the balances low. Otherwise, they could hurt your credit score.

Prepare Documents

Obtaining a small business loan requires the right documents. If you show up to the bank with nothing more than a recent statement of your savings account, they’ll probably reject your loan application. Lenders want to know that you can pay back the borrowed money. To win their trust, gather a copy of your personal credit report, business credit report, last five years of tax returns and business plan.

Identify Loan Requirements

Different lenders have different requirements to qualify for a small business loan. If you’re seeking a Small Business Administration (SBA) loan, for instance, you’ll need assets to use as collateral and provide the lender with a personal guarantee.

Don’t let insufficient cash flow prevent your small business from succeeding. By planning ahead, you can increase your chances of qualifying for a loan.

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