During the income verification process, a lender collects information about your earnings and uses that information to determine whether you can afford monthly payments. Many documents used to verify income contain Social Security numbers, addresses and other personal information, making data privacy extremely important.
Fortunately, you can take steps to protect your data during this process. Keep reading to learn more about common security risks and what you can do to preserve your privacy.
Why Data Security in Verification Matters
In the financial services industry, lenders use income verification to determine if you’re qualified for a mortgage or an auto loan. Landlords also use this process to make sure you can afford monthly rent payments.
Income verification lets lenders access your most important information, making data security critical. When a lender meets or exceeds industry security standards, you can rest easy knowing your personal information is in good hands.
Key Security Risks in the Verification Process
Traditional income and employment verification processes are rife with potential security risks, as they rely on the manual collection of data. For example, if a lender performs manual income verification, you have to provide copies of your pay stubs and other employment documents.
Once you turn over those documents, you may have some assurances through privacy disclosures and legal limitations regarding how the lender can use them. However, these safeguards don’t eliminate all risks. For example, manual handling of sensitive documents can still lead to errors, mismanagement, or unauthorized access.
If you send pay stubs, tax returns, W-2 forms and other documents via email, a hacker could also intercept them. Once an unauthorized individual has your data, there’s no way to control what they do with it.
Consumer-permissioned verification is different, offering a streamlined and secure alternative to traditional methods. With Truv, consumers authenticate access through a quick, 30-second login process, allowing Truv to securely connect directly to payroll providers. Once connected, Truv retrieves the necessary income and employment data and delivers it to the lender in real time — often within seconds. This eliminates the need to email documents or provide hard copies, avoiding the risks of email breaches or improper handling of paperwork.
By removing the back-and-forth with lenders and automating the entire process on the back end, Truv makes income and employment verification faster, more secure, and hassle-free. Understanding the benefits of Truv’s advanced approach can help you make informed decisions when choosing a lender or verification method.
How to Ensure Your Data Is Protected
Using a trusted verification service is one of the best ways to ensure data privacy. You should also review your lender’s privacy policy carefully. A good privacy policy explains how a lender uses your information and the steps taken to protect your data.
A trusted verification service should use encryption, secure servers and other technology tools to preserve your privacy. It should also comply with industry standards related to security. For example, a trustworthy verification service complies with the guidelines outlined in the SOC II framework, which ensures third-party service providers follow best practices for secure data storage and retrieval.
The Role of Consumer-Permissioned Verification
As noted above, consumer-permissioned verification eliminates the need to give your pay stubs, tax forms and other documents to lenders. Unlike manual income verification examples, you remain in complete control of your data, ensuring your information remains private.
Consumer-permissioned systems also streamline the verification process, eliminating frustrating delays. With consumer-permissioned verification, you can get approved for a loan much faster — all without putting your privacy at risk.
What Makes Truv’s Verification Process Secure?
Truv is a credit reporting agency, so it takes the following steps to safeguard private data:
- Encryption: Truv uses the Advanced Encryption Standard (AES-256) and Transport Layer Security (TLS) to prevent unauthorized access to your personal information.
- Robust monitoring: Truv uses intrusion-detection software to block unauthorized access to its network.
- Compliance: As a licensed credit reporting agency, Truv meets all standards outlined in the Fair Credit Reporting Act. We also comply with the SOC II framework.
- Independent testing: We have financial institutions and researchers conduct regular audits of our security measures.
FAQs
What is consumer-permissioned verification?
Consumer-permissioned verification makes it easier for lenders to perform income and employment verification. Instead of collecting documents from applicants, lenders can use consumer-permissioned verification services to offer consumers a platform to connect directly with payroll providers.
This reduces the time it takes to collect income and employment data. Consumer-permissioned verification also enhances security by giving consumers more control over their data.
How can I make sure my data is safe when applying for a loan?
To make sure your data is safe, choose a lender who uses consumer-permissioned verification instead of outdated verification methods. Consumer-permissioned verification reduces the risk of fraud and prevents unauthorized access to your data.
Is it safe to email pay stubs, W-2 or bank statements for verification?
Email is vulnerable to hacking and other forms of unauthorized access. If you email personal documents to a lender, you have no control over what happens to them after you hit send. If your lender prints the documents, anyone in their office can read them or record the information.
Why should I trust Truv with my employment and income data?
Truv is a licensed credit reporting agency, so we comply with strict standards related to privacy.
Truv’s employment verification and income verification services also reduce the risk of fraud, giving you greater peace of mind. With Truv’s platform, it’s possible to complete your required verifications in less time without sacrificing your privacy.
What encryption methods protect my data in verification?
TLS and the AES keep your data secure during the verification process. Truv also complies with the SOC II framework, which helps protect sensitive data from unauthorized access.
