If you are one of the many people who is thinking about getting a temporary loan from a payday loan company, then you may be wondering if they can call on your employer. The answer to this is that they can and will in some circumstances but not all. When you get a payday loan even though it is a short-term situation and one where you can usually qualify pretty easily, it is still considered an unsecured loan. For this reason, it will be necessary that you meet certain minimum qualifications. Here we’ll take a look at if payday loan companies will call your employer.
Why the Payday Loan Company Might Call Your Employer
A payday loan is an unsecured cash loan and you are approved not because of your credit rating but because of your income. If you can prove that you have a regular income, then this will be used as the criteria to determine that you can receive the loan. Because of this fact, the payday loan companies are allowed by law to call your employer to verify your status and income level.
The important thing to understand is that although the payday loan company is allowed by law to call your employer it is not required to do so. This means that it is entirely up to their discretion. Often if a borrower can give them enough proof that they find sufficient then they will not feel it necessary to call your employer. If it is a concern, however, you should definitely ask them before putting an application in for a loan.
Another thing to remember is that if one of these loan companies does call your employer it will generally be a very short conversation. All the payday loan company wants is to verify that you work there and that you’ve been there for a while and that your income level is what you said it was. As well, it is important to remember that provided the payday loan company is operating legally, then the only thing that they will verify with your employer is your employment and income level. They are not allowed to contact your employer to collect late payments.
Can They Harass Me If I Fail to Pay Them Back?
The federal law says that a company cannot unfairly harass or make any type of threats or commit harm to you physically or against any of your property. It is unlawful for them to provide any type of financial disclosures about you to others without your written consent. This means that if they were to tell your employer or your neighbors or anyone else about your financial situation without your consent, they would be in violation of the law.
Once the loan has been made the Payday Loan Company no longer has a right to contact your employer for any reason. Even if the borrower fails to pay back the loan the payday loan company is not allowed by law to call the employer again. It is important to remember that a failure to pay back a loan is not a criminal offense it is a civil offense. If the Payday Loan Company calls an employer when the borrower fails to pay back the loan, then they are committing a criminal offense. Even so, the less scrupulous lenders may try to use this tactic.
What Can A Borrower Do If A Payday Loan Company Illegally Contacts Their Employer?
The main recourse that a borrower has in the case where a payday loan company illegally contacts their employer is to get in touch with the FTC. They will usually take such a case seriously and they will investigate to see if the company is in any violations. Of course, this may not help with your employer if the employer feels that this is interfering with their business. To prevent this in the first place it’s a simple matter of making sure that you’re dealing with a reputable company.
