Do you need to borrow money to handle an unexpected expense? Before you apply, you need to take some steps to ensure your personal information is safe.
In the financial world, personal information consists of your contact details, banking numbers, and social security number. In other words, all the stuff hackers need to commit fraud.
It’s a good idea to keep this information under cyber lock and key any time you borrow. Whether you’re applying to get a loan today or keeping this in mind for a later date, here are some tips for borrowing an online loan safely.
What You Can Expect from a Lender
Bad lenders follow subpar practices that put your financial details in the crosshairs. Luckily, they happen to be a minority.
The majority of financial institutions understand the importance of safeguarding their customer’s information.
It’s just good business. Having the right policies in place will save them the headache of dealing with the fallout of a data breach, something that could cost them dearly in settlements and reputation.
So what are these policies that work in both your favors? Here’s what you should look for in a lender.
1. Encryption
You can’t apply for or receive an installment loan online unless your lender can collect your data on their website.
When they do, they should use comprehensive secure socket layer (SSL) encryption to ensure the data you share with their servers is protected at every step of the process.
2. License
A license is a good sign a financial institution uses adequate encryption. Privacy and lending laws in the US require financial institutions to acquire a license before they can provide loans — from cash advance payday loans and installment loans to lines of credit. These laws protect you from unsafe borrowing practices, including online security risks.
What You Can Do to Protect Your Data
Once you find a financial institution that satisfies the above criteria, that’s one step down. The next? Making sure your online habits aren’t going to undo all the hard work lenders do to protect your data.
Here are some safety tips to remember any time you apply for or manage a loan online.
1. Use Strong, Unique Passwords
Using the same login credentials for every account is a bad idea. As soon as one account gets hacked, all of them are exposed. That’s why it’s crucial you create a strong, unique password for your online loans, even if you borrow from a secure lender. This online loan account will be safe even if your email gets exposed in another unrelated breach.
2. Review Your Financial Statements and Credit Report
Checking your financial statements is an excellent habit to get into at anytime — before, during, or after you borrow money. It helps you keep tabs on all that’s coming and going in these accounts, so you can catch anything that’s amiss.
When it comes to your credit report, you’ll want to watch out for unusual payment history and balances in existing accounts, as well as new payday loans cash advances or line of credit extensions you didn’t request. This is a sign someone is using your financial details to borrow money, leaving you on the hook for the bill!
Bottom Line
It’s normal to exchange personal information when borrowing money online. But you’ll want to make sure you and your financial institution are handling this info properly. Follow these tips to keep your identity safe.
