Short answer: federal rules require banks to collect your name, date of birth, address and an identification number such as an SSN or ITIN, and to verify who you are. Creditors covered by the FTC's Red Flags Rule must also run a program to spot identity theft. Share these details only through the lender's own secure application, never in reply to a text or call you did not expect.
What banks must collect: the CIP rule
A bank's customer identification program must collect at least four things before it opens an account (31 CFR 1020.220(a)(2)(i)):
| Item | What the rule asks for |
|---|---|
| Name | Your name |
| Date of birth | For an individual |
| Address | A residential or business street address, with limited alternatives if you have neither |
| Identification number | For a U.S. person, a taxpayer identification number; for a non-U.S. person, a taxpayer identification number, passport number and country, alien identification card number, or another government-issued photo ID number |
The bank must then verify your identity within a reasonable time, using documents such as an unexpired government-issued photo ID like a driver's license or passport, other methods, or both (31 CFR 1020.220(a)(2)(ii)). This rule is written for banks. Other lenders set identity checks under their own rules and policies, so the list a lender gives you may differ.
The Red Flags Rule for creditors
The FTC's Red Flags Rule applies to financial institutions and creditors under FTC enforcement of the Fair Credit Reporting Act (16 CFR 681.1(a)). Those that offer covered accounts, such as credit cards, auto loans and other accounts paid over time, must have a written Identity Theft Prevention Program to detect, prevent and mitigate identity theft when an account is opened (16 CFR 681.1(b), (d)). The program must identify warning signs of identity theft, detect them and respond to them (16 CFR 681.1(d)(2)).
Why an SSN or ITIN is requested
For a U.S. person, the identification number a bank collects is a taxpayer identification number, such as an SSN or ITIN (31 CFR 1020.220). The CFPB says hard inquiries are often made by lenders after you apply for credit, to help them decide on the application (CFPB). If you do not have an SSN, the ITIN loan guide covers applying with an ITIN. If you froze your credit, the credit freeze guide explains how to lift it for an application.
How to share it safely
- Start the application yourself, from the lender address you looked up, not from a link in a message.
- Check that the lender is licensed before you send anything; see how to check a license.
- Ask what the lender will use your SSN or ITIN for and whether it will check your credit report.
- Do not send a photo of your ID or your SSN by text or email unless you have confirmed the request with the lender directly.
Red flags
- Someone asks for personal information or money, pressures you to act right away, or pretends to be an organization you trust. The CFPB lists these as warning signs of scams (CFPB).
- A text or call you did not ask for that wants your SSN or ID; see the fake loan text and call guide.
- A fee asked for before you get the loan; see the advance-fee scam guide (FTC).
- Payment asked by gift card, wire transfer, cryptocurrency or a payment app (CFPB).
If someone has already used your details to borrow, follow the guide to a loan taken out in your name and report it at IdentityTheft.gov.
Questions to ask the lender
- Which documents do you need to confirm my identity, and how do I send them securely?
- Will you check my credit report, and will it be a hard inquiry?
- How do you contact applicants, so I can tell a real request from a fake one?
This guide explains federal rules in general terms. It is not legal advice.
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Sources
- 31 CFR 1020.220: customer identification program requirements for banks
- 16 CFR 681.1: duties regarding the detection, prevention and mitigation of identity theft (Red Flags Rule)
- CFPB: What is a credit inquiry?
- CFPB: What are some classic warning signs of possible fraud and scams?
- FTC: What To Know About Advance-Fee Loans
- FTC: IdentityTheft.gov
Disclosure: Modern Lending Solutions is not a lender, loan broker or agent for any lender or loan broker, and does not make credit decisions. Any compensation we receive is paid by participating lenders, only for advertising services. This guide is general information, not financial or legal advice.