Yes, payday loan lenders may call up your employer to confirm the information you have provided and ensure that you have an adequate source of income.
Contacting your employer is a normal part of the application process for many payday loan lenders, but not all.
If your lender is one that likes to perform proper its due diligence in regards to employment status, know that your privacy is protected. Thanks to state and federal privacy laws, lenders cannot disclose the purpose of their call or divulge anything concerning your finances to your employer without your express consent.
Learn: Do payday loans call your references?
When you sign up for a payday loan, lenders will usually ask for your employer's contact information to call them for the purpose of conducting their employment check. During that call, your lender will be looking to confirm that:
- You are who you say you are.
- You actually work there.
- And you make as much as you say you make.
In order to obtain a payday loan, you will most always need to prove your income. This is usually done through providing paystubs and/or bank statements. Though, some lenders like to take it a step further and reach out to your employer directly to verify your earnings. They may also give them a ring to check your employment history and record as well.
Learn: Can you get a payday loan without a job?
Be aware that contacting your employer is also a tactic that lenders can use to track you down if you fail to repay your loan on time and fall out of contact. But, they are even more heavily restricted on what they can share with your employer in that regard (or with anyone for that matter).
When attempting to collect a debt, lenders cannot share information like how much money you owe, your financial situation, or litigation status with your employer. They can only ask things like "Does Jessica work there?" or "Can you provide me with a contact for Michael?"...Assuming that your name is either "Jessica" or "Michael". 😏💁♂️
Learn: How do payday loans work online?
It's in both parties (the lender and your employer) best interest to protect your privacy or they can get in big trouble! So—in many cases—to avoid the mishandling of your privacy and information, most lenders will call the phone number provided and be directed to the HR department (or equivalent) where they are better equipped to deal with sensitive information.
So, if a payday loan lender asks for your employer's information, don't sweat it! As uncomfortable as it may be to have a lender digging into your life, know that it is normal. And you can find comfort in knowing that, by law, your privacy is protected! 👌
