applications

7 Times You Don't Have to Give Your Social Security Number

Mikey Rox — Mon, 30 Apr 2018 09:00:11 +0000

It seems like every time you fill out an application or formal document, somebody wants to know your Social Security number. Many times we just give it up — the organization is reputable, so what's the harm? But the question you should be asking yourself is, "Why?"

Why are you being asked to give up one of the most important legal identifiers and the master key to identity theft? Is your Social Security number actually required, or can you continue the process without divulging that information? Here are the times you can keep your SSN to yourself. (See also: When Is It Okay to Share Your Social Security Number?)

1. During a job interview

If you're hired for a job — or at least in the last few stages of the hiring process — your employer will request your Social Security number so they can do a background check. This is an appropriate time to provide it to them. Any requests beforehand, like on your application, are not mandatory and your chances of getting that job shouldn't be hurt by withholding your SSN.

2. Loyalty cards for retailers

If the application for a retailer's loyalty card requests your SSN, skip this section. There's no reason they need it since the card has no credit value — you're just racking up store points. Sometimes store policy mandates the application can't be processed without this information, and in that case, you're better off declining the program. Considering how many retailers get hacked these days, this is a wise move to make if you want to at least try to protect your personal information from identity theft.

3. School (unless you're applying for financial aid)

You'll need some kind of identifying information to register for school. Birth certificate, driver's license, passport, and bills showing your name and address are all acceptable documents to prove you are who you say you are. But it's illegal for public schools, in particular, to require a Social Security number to attend. Same goes for college — unless you're applying for financial aid or scholarships. In that case, they need your Social Security number in order to qualify you based on you or your family's income.

4. Doctor's offices

Generally, you're not required to provide your Social Security number to medical service providers unless it's a part of a transaction that must be reported to the IRS or required to do a credit check with one of the major credit reporting agencies. Doctors want your Social Security number for one reason and one reason only: money. They ask for it so they can send your information to a collections agency if your account becomes delinquent.

You're not required to provide your Social Security number to medical providers. Some will accept another form of numerical identification, but others may refuse to do business with you unless you provide it.

5. Government benefits

Government agencies may ask for your Social Security number, but the Privacy Act of 1974 requires these agencies to inform people whether or not a Social Security number is required by law at the particular agency. If it is not required, the agency cannot refuse to provide you benefits if you decide not to divulge your SSN.

6. Booking travel

When booking travel, only your credit card is required to pay for the trip or to put on file for incidentals, like at a hotel. Anybody asking for your Social Security number when booking travel is likely not reputable, and you should look elsewhere for arrangements. You don't need to provide your SSN to anyone during your travels, either. Your passport or driver's license will have all the information any authority needs to identify you.

7. Over the phone to someone who's called you

Never give your SSN to anyone over the phone who has called you. It may be a scam. If it's a company with which you do business, ask for the caller's name and let them know that you'll call the company directly — from the number listed online or in documents you may have, not from a phone number they provide you. You can then call them back and inquire about their request. (See also: What to Do When You Suspect a Scam)

There are only a few organizations entitled to collect your SSN

Barry Cohen, a former employee of the Social Security Administration, says there are only a few organizations that have the legitimate right to collect and use your Social Security number, mostly limited to the Social Security Administration and the U.S. Internal Revenue Service.

"While many organizations and companies request it — and while it has become commonplace for many to collect and use it — they are, in fact, unauthorized uses and therefore you should not be required to provide the number," says Cohen. He says the SSN was never intended to be used as a national identification number. "True, law enforcement agencies will often use it. However, the Social Security Administration does not routinely provide the numbers to them."

You may find yourself unable to get a credit card, home mortgage, or other loan without supplying your Social Security number, but in most other cases, there's no legitimate reason for anyone to collect this information. If you're uncomfortable with providing your SSN in any situation, know your rights and speak up. (See also: 9 Signs Your Identity Was Stolen)

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This article is from Mikey Rox of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

5 Questions to Ask Before Signing Up for a New Credit Card

Jason Steele — Tue, 18 Apr 2017 08:30:11 +0000

There's no shortage of attractive offers for new credit cards. The credit card industry is extremely competitive, and you are likely to come across advertising for new cards on television, in print, online, and even on airplanes. But as compelling as these offers can be, you still need to think carefully before applying. (See also: Pre-Approved for Credit Card Offers: What Does It Mean?)

Opening a new credit card account is an important financial decision, and you should consider these five things first.

1. Can you manage a new credit card account?

Before you even begin to consider which credit card to apply for, think about if you need a new credit card at all. If there's any chance that having a new credit card will entice you to overspend and incur debt, then it's best not to apply. (See also: The Fastest Way to Pay Off $10,000 in Credit Card Debt)

Keep in mind, too, that each new credit card you have will generate a new statement to review each month, and another bill to pay. If your new card is from a different issuer than your other cards, then you'll need to create a new online login and you might want to download a new mobile app. Having more cards than you can keep track of increases your chances of losing them or having one stolen.

2. Does this credit card meet your needs?

Just as there are dozens of different cars made for nearly any kind of use, there are hundreds of different credit cards designed to meet every conceivable need. If you tend to carry a balance on your credit cards, then you should be looking for a card with the lowest possible interest rate.

You could also look for a card with an interest-free promotional financing offer, to help you pay off your debt sooner. (See also: How to Pay Less Interest on Your Credit Card Debt)

If you always avoid interest charges by paying your entire statement balance in full, then you should be earning rewards for your spending in the form of points, miles, or cash back. (See also: Cash Back vs Travel Rewards: Pick the Right Credit Card for You)

3. What interest rates and fees will you have to pay?

Before you apply for a credit card, you should understand all of the costs of the card. Fortunately, credit card issuers are required to prominently disclose the important rates and fees in a standardized table. Any time you see a credit card application, you can look for a link to the "terms and conditions" or "rates and fees." There, you will find a list of fees including the annual fee, late fee, cash advance fee, balance transfer fee, and foreign transaction fees, if any. It will also show you the standard interest rate and any promotional rates for new purchases, balances transfers, and cash advances. (See also: Simple Guide to Evaluating a Credit Card With an Annual Fee)

4. Do you qualify for approval?

There's no point in applying for a credit card if you won't be approved. First, you need to look up your credit score. Most credit card issuers now offer free access to your credit score online, and there are several websites that can also provide you with a free credit score.

Next, you need to research the credit cards that you are applying for, and learn what kind of credit score is needed. For example, a credit card issuer's website may list each card according to the type of credit history needed, such as "Average" or "Good." In addition, many credit card issuers will have special cards designated for people who are rebuilding their credit. Finally, you can assume that the most competitive premium rewards credit cards will only be offered to applicants with excellent credit. (See also: How to Use Credit Cards to Improve Your Credit Score)

5. Is this the most competitive offer available?

It's easy to find credit card offers, but it can take some time to locate the most competitive offer for your needs. If you are looking for a card with the lowest interest rate, then you need to look at the terms and conditions of multiple cards to find the best offer. And if you are trying to earn rewards, then you need to estimate the value of the rewards you would receive from the card, based on your own personal spending habits. Finally, you also need to take into account the value of any cardholder benefits offered, and the cost of the annual fee and other fees. (See also: Credit Cards With the Best Sign Up Bonus Offers)

This article is from Jason Steele of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

5 Common Money Moves That Can Get You Into Legal Trouble

Dan Rafter — Thu, 16 Mar 2017 11:00:07 +0000

They seem like minor fibs: We forge our spouse's name on the back of a check. We inflate our monthly income when applying for that rewards credit card. We run a small business from home, and might fib about the size of our office in hopes of getting a tax break from the IRS.

These may all seem like harmless white lies. But these seemingly innocent money moves — and others like them — can get you into serious legal trouble.

1. Signing Someone Else's Name on a Check

You want to deposit a check into your savings account. The only problem is that check is made out to your spouse, and they're not around. It seems like an easy matter to scribble your spouse's signature on the back of the check and then deposit the money into your joint savings account.

But resist the temptation. It is illegal to forge someone's name on a check, even if that person asks you to do it.

The same holds true if you want to, say, pay a bill on behalf of an elderly parent. In some cases, if you control this parent's checkbook, it might seem easier to forge your parent's name on the check instead of obtaining your parent's actual signature. This, too, is illegal, even if your motives for forging the signature are good.

The odds are high that neither of these forgeries will ever be discovered or reported to the police, of course. But why take the chance?

2. Writing a Bad Check — On Purpose

It happens sometimes: You drain your bank account while you still have bills to pay. Your bank might have overdraft protection if you unknowingly write a check for more than your balance. But if you write a bad check on purpose, knowing that you don't have enough funds in your account to cover it, that is illegal.

If you're caught, you could face a fine and maybe even jail time, depending on the severity of your crime. Even if you're not charged with a criminal act, your bank might charge you a hefty penalty for writing a bad check. And the shops that unknowingly took your bad check may no longer accept your business.

3. Lying on a Credit Card Application

That credit card might come with a tempting sign-up bonus or generous rewards program. Dreaming of all the ways you can put those rewards to use, you decide to fib a bit on your application, in hopes of increasing your odds of qualifying for the card.

Guess what? That's fraud. And it's illegal.

You might be tempted to inflate your monthly income when applying for a particularly appealing credit card. But resist this temptation. Credit card companies only approve consumers who meet certain financial requirements. If you lie about yours, your credit card provider can pursue legal action against you, including fines and possible jail time.

Sure, the odds are low that you'll face these penalties for lying on your credit card application. But avoid all of the risk by being honest about your age, income, and employment when applying.

4. Lying About Your Home Office

One of the benefits of running a small business from your home is you can take advantage of the home office deduction, which can reduce the taxes you pay each year.

There's a catch, though: You must use your home office "exclusively and regularly" as your principal place of business. And you can only deduct the exact areas that you use for business.

This means that if you use your bedroom as your office, you can't claim its entire area as a deduction, just the corner where your desk and computer sit. If you lie about the size of your home office, and the IRS finds out, you'll be hit with penalties and a higher tax bill.

5. Lying About Who'll Be Living in That Home You're Buying

It's not easy to lie on a mortgage application. Lenders will request copies of your bank statements, paycheck stubs, and tax returns to make sure that you're honest about how much money you make.

But there is one lie that's not easy for mortgage lenders to discover: A fib about who will actually live in the home.

You might be buying a home with the intention of renting it out as an income-producing property. That's fine, but you have to be honest with lenders about this. That's because lenders typically charge higher interest rates to buyers who are renting out homes instead of living in them. They also might require a higher down payment. By claiming that you will live in the home when you don't plan to, you might be able to land a lower interest rate.

This is mortgage fraud, and it is highly illegal. If you're found guilty of committing this crime, you can face hefty fines and several years in jail.

Don't take the risk. Instead, be honest and pay those higher fees if necessary.

This article is from Dan Rafter of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

This Simple Mistake on a Credit Application May Cost You

Ashley Eneriz — Thu, 01 Sep 2016 10:30:07 +0000

Besides your credit score, your income may play an important factor in whether you get approved for a credit card, and the amount of credit you will be approved for. But for those with freelance jobs or other variable sources of cash, determining an exact income to report can be difficult.

Obviously, you want to be as accurate as possible, but you also want to report the highest amount of income applicable so that you can qualify for your card. Your income is how credit card companies can determine if you are able to pay back your debt. Even if you do not plan on accumulating credit card debt, credit card companies still look at you as a debt risk. If you only say that you make $20,000 a year, then why would a credit card company want to take a chance on you with a $12,000 credit line?

Types of Income You Can Report on a Credit Card Application

Applicants over the age of 21 can list a wide range of types of income that they have reasonable expectation of access to. Here are some of the following types of income considered:

Personal Income

Put simply, this is your gross income figure. If you are a freelancer or self-employed, base this number off your total income the year before or your average monthly income multiplied by 12. For example, if you regularly make $2,500 to 3,000 per month, then reporting an income of $33,000 should be fairly accurate.

Spousal Income

As of 2013, you can count income from your spouse or partner on your application.

Allowances and Gifts

Do you regularly get a few hundred dollars for your birthday from family members and friends? You can add it to your income list.

Scholarships and Grants

This is a benefit for college students who have received scholarships and grants for the school year. If you are not accepted for a credit card, call the reconsideration line and talk about your scholarships and other redeeming qualities (i.e. leadership programs you run at school, GPA, and other accomplishments that can boost your credit worthiness).

Trust Fund Distributions

If you're fortunate enough to have a trust fund, report the average amount you expect to receive in a typical year.

Retirement Fund Distributions

Retired? Great! Don't forget to list distributions from 401Ks, IRAs, or other retirement funds.

Social Security Income

Ditto for Social Security income. List your yearly benefit amount as income.

For borrowers between 18 and 21, only independent income can be reported. This includes personal income (including any regular allowances from relatives) and scholarships and grants. Borrowers between 18 and 21 might have better luck being added as an authorized user on a parent's account. This can help build up credit history without having to turn to high interest fee cards.

Types of Income You Should Not Report

Note that student loans do not count as income. Once you graduate, student loans become debt you must repay, and it is best not to pile on credit card debt on top of that.

Your mortgage or equity in your home should also not be considered income.

Consequences of Lying About Income on Credit Card Applications

While you might want to gain access to a credit card, it is never a good idea to lie about your actual income. Stretching the truth on your application and getting approved can mean that you are more likely to get into debt without the income to get you out.

On a more serious note, lying on credit card applications is considered credit card fraud, which is punishable by up to $1 million in fines and up to 30 years of prison. While these punishments are on the extreme side, individuals caught falsifying income to gain loans or credit cards have been hit with hefty fines.

In 2012, 52-year-old New York resident David P. Gaylord faced charges for reporting an inflated income of $90,000 to $122,000 on three credit card applications in 2006. However, the IRS reported his income as $12,488 that year. Gaylord was sentenced to five years of supervised release and ordered to pay $46,914.73 in restitution.

If you are still unsure about how to fill out your application, consider calling the credit card company to talk with a person who can guide you through the application process.

Do you have multiple sources of non-wage income? How do you report it on credit apps or elsewhere?

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This article is from Ashley Eneriz of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

The 10 Most Common Financial Aid Mistakes — And How To Avoid Them

Brittany Lyte — Mon, 23 May 2016 09:30:26 +0000

For many students, the Free Application for Federal Student Aid (FAFSA) is crucial to making college affordable. While the application process can be greatly rewarding, that doesn't mean it's easy. FAFSA is riddled with confusing acronyms and financial lingo. And getting any money out of it is contingent on meeting deadlines and reporting dollar amounts precisely. Errors can greatly reduce or eliminate your financial aid award. Read on for our roundup of the most common FAFSA flubs — and our tips for avoiding them.

1. Missing Deadlines

The price of missing the FAFSA application deadline can be steep. So don't fall victim to this time management failure. Stay on top of deadlines by creating a due date calendar. Vow to review it daily. For each deadline item, create a list of tasks you'll need to complete to meet the due date. Estimate how much time each of these tasks will take you to finish. Add this information to your deadline calendar and hold yourself accountable.

2. Procrastinating

This year the FAFSA form will be made available on October 1. That's a full three months earlier than usual. Despite the early bird form availability, it will serve you best to fill out the FAFSA and submit it as soon as possible. Many folks wait until after they file their taxes to fill out and submit the FAFSA, and in some cases that can be too late. At least nine states award financial aid on a first come, first served basis — until the money runs out. Even if you beat the official deadline, waiting to file could potentially cost you everything.

3. Messing Up Numbers

While it's important to fill out the FAFSA in a timely manner, it's equally important that you fill it out correctly. Double-check to make sure the numbers you enter onto the FAFSA form are correct and in the right field. One faulty keyboard stroke could cost you thousands of dollars.

3. Leaving a Field Blank

If the answer is zero, write zero. Leaving a field blank can prompt the processor of your application to assume that you failed to answer the question. It can also lead to grave miscalculations and processing delays. So before you submit your application, double-check that all fields are filled in.

4. Not Including Stepparents

The FAFSA can be filed by just one parent. But if this parent is remarried, the financial information for that spouse — the student's stepparent — must also be reported. Depending on that stepparent's income and assets, a student's eligibility for need-based financial aid can fluctuate greatly.

5. Not Including Stepchildren on an Application

To soften the blow of a well-off stepparent, stepchildren may be included on the FAFSA application, as well. By including stepchildren, you'll make adjustments to the household size and expected family contribution portions of the form, thereby creating opportunity for greater need-based aid.

6. Filing the Wrong Form

At any given time, there are two versions of the FAFSA that could be filed: The FAFSA for the current academic year, and the FAFSA for the upcoming academic year. The majority of applicants — those seeking to attend school in the upcoming school year — will want to file the latter. Be sure that you've got the right form for your desired college enrollment date.

7. Not Using the Right Website

The FAFSA is free to fill out and submit on fafsa.ed.gov. But beware: There are imposter sites out there. If you are asked for your credit card information, you're not on the official government site.

8. Including Retirement Info

Retirement info, such as your 401K or IRA assets, should never be included on the FAFSA. Only non-retirement financial data is required. Mistakenly including retirement funds on the form could reduce your chances of winning need-based aid, so be sure to avoid this mistake.

9. Entering the Wrong SSN

Most of us are rarely called upon to state our Social Security numbers, which could be why so many folks misstate these numbers on the FAFSA. Double-check SSN numbers before submitting the form, and make sure you have the correct number matched to the right family member.

10. Failing to Seek Help

Successful completion of the FAFSA form is no easy task. If you're flustered, seek help. There's a FAFSA hotline available to help you navigate the process as well as free online resources, such as the FAFSA calculator.

Did you find the FAFSA process confusing?

This article is from Brittany Lyte of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

5 Moves to Make If Your Loan Gets Denied

Dan Rafter — Tue, 17 May 2016 09:00:04 +0000

You needed an auto loan to finance that new convertible. Or maybe you applied for a mortgage loan to buy your dream home. Whatever type of loan you needed, the answer was the same: A big "no" from your lender.

Lenders reject loan applications for a variety of reasons, but two stand out: Borrowers either have a low credit score, or they're already paying off too much debt each month.

Fortunately, you can take simple steps to strengthen your finances and turn that loan rejection into an approval. Here are five moves to make after your loan gets rejected to qualify for that financing:

1. Order Your Credit Score

Your FICO credit scores are key when you're applying for a loan. You have three of them, one each generated by the national credit bureaus of TransUnion, Experian, and Equifax. These scores tell lenders how well you've managed your credit in the past. If you have a history of paying your bills late, running up credit card debt, and missing payments altogether, your FICO scores will be weak. Lenders consider a FICO score of 740 or higher to be a strong one. But if your score is too low — say, under 640 — you'll struggle to qualify for loans. And when you do qualify for a loan, you'll have to pay a higher interest rate.

Before you re-apply for a loan after a rejection, order at least one of your FICO credit scores. Lenders are also required to provide you with a copy of your score if that’s the reason you were denied the loan.

2. Order Your Credit Reports

You should also order all three of your credit reports, maintained by each of the credit bureaus. These reports list your personal information and detail your history of managing credit. They show how much you owe on credit cards and other loans, and any missed or late payments from the last seven years. They'll also list any negative judgments, such as bankruptcies or foreclosures that are up to seven or 10 years old, respectively. You can order each of your three credit reports once a year for free at AnnualCreditReport.com.

Once you receive your reports, check them for mistakes. A single mistake on a credit report can send your credit score tumbling. If your report lists a missed car payment that you know you made on time, correct the error by contacting the offending credit bureau through email or by phone. Correcting an error can provide a quick boost to your credit score. Make sure, though, that you can provide documentation, such as a credit card statement or bank account record, proving that you actually did pay the "missed" payment on time.

3. Pay All Your Bills on Time

The best way to boost a weak credit score is to start a new history of paying all your bills on time. Your bill-payment history accounts for 35% of your credit score, according to myFICO.com. Paying your bills on time will cause your score to rise. But this takes patience. Depending on how weak your score is, it might take you several months, or even more than a year, to boost your score to a level acceptable to lenders.

4. Reduce Your Monthly Debt

Lenders often reject loans when borrowers' debt-to-income ratios are too high. In general, lenders want your total monthly debts — including the estimated amount you'll be paying each month for your new loan — to equal no more than 43% of your gross monthly income. If your debt-to-income ratio is higher than this, you'll greatly increase the odds of receiving a rejection on your loan application.

The easiest way to improve a debt-to-income ratio that is too high is to pay off as much of your debts as possible. Usually, this means reducing credit card debt. Paying off the amount you owe on your cards will slowly but steadily cause your debt-to-income ratio to fall.

5. Keep Paid-Off Credit Cards Open

Say you pay off a credit card entirely and you no longer plan on using it. You should close that account, right? No. Never close unused credit cards. Cards with zero balances can actually help your credit score.

That's because lenders look at something called your credit-utilization ratio. This ratio looks at how much of your available credit you are using. The lower this ratio, the better. Closing an unused credit card will instantly hurt this ratio.

Say you have four credit cards, each with a credit limit of $4,000 for an available credit of $16,000. Say, too, that you have $5,000 worth of credit card debt. That comes out to a credit-utilization ratio of about 31%, $5,000 divided into $16,000. But say you close one of your four cards. That reduces your available credit to $12,000. Your debt-utilization ratio immediately jumps to about 42%, $5,000 divided into $12,000.

It's okay to keep a paid-off credit card in your wallet. Just make sure that you don't run up another hefty balance on it.

Have you ever had a loan app denied? What did you do after?

This article is from Dan Rafter of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread: