The social security number (SSN) is issued by the Social Security Administration to all US citizen and primary and temporary citizens. It consists of nine digits. SSN is used to track each individual’s accounts in the US in an attempt to secure the society from any potential frauds and embezzlements.
Social Security Number must be issued in order to fulfill the requirements of a statute. SSN must be provided whenever any loan is sought or financial transaction is conducted either with banks or other financial lenders.
Uses of SSN
• Every individual is issued a unique SSN, so that in case of any grievance that particular number may be linked to the particular SSN holder, serving the purpose of personal identification document.
• Employers must obtain and present their Social Security Number for taxation purposes.
• According to Federal law, the private businesses must collect their SSN when Internal Revenue Service (IRS) required to be notified about all the business and financial transactions.
Why SSN is required to receive online payday loans no credit check?
Issuing loans to clients leaves the banks with several concerns including if the borrower will pay the interest payments and the principal amount.
To cater its concerns, the bank requires important information which also includes the social security number. There are a number of reasons for which the SSN number is required by the bank before it sanctions the loan amount. Following are discussed the foremost reasons:
Social security number serves as an identification document. Although, fraud could be the last thing on mind of the borrower but to keep themselves on the safe side, banks aim to ask for all the possible identification modes. The banks would verify the social security number with Social Security Administration whether it really belongs to the person requesting loan.
Assessing Credit History:
The credit history of the borrower greatly concerns the bank before they issue a mortgage loan or other debts. In order to assess the credit report from credit reporting agencies like Experian, TransUnion or Equifax, the bank uses social security number of the borrower.
Deducting the mortgage interest:
The mortgage interest payments are deductible expenses from the taxable income. Thus, in order to verify the mortgage interest paid, the banks will have to fill in the SSN on the form used for calculating taxable income.
In case the borrower does not have a social security number, then he may opt for another type of mortgage loan that uses the person’s Individual Tax Identification Number (ITIN). This number is assigned by IRS in order to facilitate those people who do not hold a social security number.
The ITIN is also a nine digit number similar to social security number. The banks may or may not use ITIN to issue loans, so it is intelligent to search those banks that accept ITIN to grant mortgage loans. In around 30 cities in US, the Citibank with the help of ACORN issues the ITIN mortgage loans that accept ITIN instead of SSN.…Continue Reading...