Random Discover 4506-C Request

[Horseshoez]

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@OmarGB wrote:

Also, if one PIF (as I presume you most likely do), what does the interest rate matter?

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^This!  Personally if any given card fit my needs perfectly, I could care less whether the interest rate was 50%, I'd still want it.

[7774x]

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@FinStar wrote:

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@Kforce wrote:

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@Horseshoez wrote:

To kind of dovetail on what @Kforce said, if I any of my credit card issuers hit me with a 4506-C request, the only response they'd get from me is my card(s), cut in half, back in the mail.  There are plenty of credit card issuers out there, Discover is nothing special and it is time for them to learn that.

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^^^^ This

However I also believe you and I are not the norm.

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And, there are others who likely do not mind providing the information, albeit an inconvenience + depending on the circumstances. Discover isn't going "to learn" anything by someone refusing to provide consent. They're still lending daily 🤷‍♂️

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Have not got one yet .. However.. adios to Discover if it shows up .. Your Tax records will be permanently stored  by DC .. Who  else will have access? ..  What about Discover getting hacked ?   Like others have posted  here ,discover is  nothing  special, good card...  but many cards are out ther just as good....  don't care if Discover ever learns 

[7774x]

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@KatrinaE wrote:

Has anyone had any experience with this situation?
Had my discover cards for at least 10 years.  Received an email this afternoon from Discover:

Discover® Financial Services requires your consent to receive income information from the Internal Revenue Service (IRS) to verify information on your account.  

You can expect a separate email from "Verification Services" (sent via AdobeSign) with the subject line: "Verification Services" Has Sent You IRS Consent Form 4506-C to Sign. Please follow the step-by-step instructions in the email within five days.

Note: If the email is not in your inbox, please check your junk mail or spam folders.

Prompt action must be taken in order to validate your account information for continued use. Until this verification is complete, a temporary hold has been placed on your account. If for any reason you are unable to complete the consent form, please contact us directly at 800-203-4969, or call the phone number on the back of your card.

Once Discover has received and processed the IRS information, you will be contacted in writing to advise that the review of your account is completed.

We appreciate your prompt attention and cooperation.

Thank you,

Discover Financial Services

I then receieved the subsequent email from Equifax with a link to the filled out 4506 form including SS number for me to sign.  They are requesting 2020 and 2021 tax returns.  I own two businesses - tax returns for 2020 were filed with an extention and extension was filed and were just filed two weeks ago so there will not be a transcript avail for several weeks. 

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Anyone know what is going on with the sudden increase for this form that is usually used in Mortgage Lending being used now for Credit Cards?  
I thought Fico scores ..CRs were predictors of financial well being   Like a poster said ..having a Discover card  should not be like applying for a mortgage 

[CreditCuriosity]

My opinion won't be so popular here.  I wish ALL FI's would require some sort of POI whether several months of paychecks or 4506 for anyone applying for unsecured credit.  Their losses would be less likely as they would get a true picture of a persons financials other then counting on some 3rd parties data sources.  Some of these 4506 request do come as a discrepancy of reported income to what lenders see from these 3rd party sources.  Possibly as a result some of their losses would be passed on to others in form of lower APR's etc.  Just my take.

[Horseshoez]

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@CreditCuriosity wrote:

My opinion won't be so popular here.  I wish ALL FI's would require some sort of POI whether several months of paychecks or 4506 for anyone applying for unsecured credit.  Their losses would be less likely as they would get a true picture of a persons financials other then counting on some 3rd parties data sources.  Some of these 4506 request do come as a discrepancy of reported income to what lenders see from these 3rd party sources.  Possibly as a result some of their losses would be passed on to others in form of lower APR's etc.  Just my take.

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I don't think lenders would need to be so draconian as to request a 4506-C from most prospective borrowers, simply ask the borrower for permission to verify their income from their employers.  As an addendum to my post above saying if one of my FIs asked for a 4506-C I'd close the account; if the same FI was to ask for the HR link to verify my income I'd have no issue with that.

[Anonymous]

In following on the poster's comments upthread ...

My history pulls from an era when you filled out an Income and Expense profile plus a Balance Sheet. That slowed credit approvals to a full thirty-days and many much lower credit lines. Oh, almost forgot, the FI verified the information! No taking anyone's word for it.

Question, was it better than today? All in the eyes of the beholder?

[CreditCuriosity]

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@Horseshoez wrote:

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@CreditCuriosity wrote:

My opinion won't be so popular here.  I wish ALL FI's would require some sort of POI whether several months of paychecks or 4506 for anyone applying for unsecured credit.  Their losses would be less likely as they would get a true picture of a persons financials other then counting on some 3rd parties data sources.  Some of these 4506 request do come as a discrepancy of reported income to what lenders see from these 3rd party sources.  Possibly as a result some of their losses would be passed on to others in form of lower APR's etc.  Just my take.

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I don't think lenders would need to be so draconian as to request a 4506-C from most prospective borrowers, simply ask the borrower for permission to verify their income from their employers.  As an addendum to my post above saying if one of my FIs asked for a 4506-C I'd close the account; if the same FI was to ask for the HR link to verify my income I'd have no issue with that.

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This is what lenders are doing that alot of people don't know they are doing.  Alot of time you are not hearing the full story as with anything in life.   I am not saying this is the case here.  For example a third party tool is the works numbers and several others others they either know exactly what someone makes if employer participates in it and they can get it that way or other sources that is kinda a science on what a person makes and if those don't add up is alot of the 4506's requests from discover or other FI's.  I guess I tend to go the CU route as they are for the members as alot request POI right off in one form or another thus they are able to typically offer better rates/higher CL's etc due to being validated up front and they are member owned vs shareholder owned and likely have lower loss rates.  I am not saying 4506's are the answer as some do have personal information, but when applying you are playing in lenders sand box and as stock holder in Amex, BofA and other banks I want bank to do their due dilenge to protect my investment and give me a good return on my investments.

[Horseshoez]

@CreditCuriosity, I'm good with due dilegence, I'm not good with sharing tax information.

[crystal626]

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@Horseshoez wrote:

@CreditCuriosity, I'm good with due dilegence, I'm not good with sharing tax information.

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Exactly. I would happily provide bank statements or my Social Security award letter (which specifically says it is to be used for the purposes of getting credit) but there aren't many banks I'm willing to give my taxes to, same for these services like Plaid and Yodlee that watch my account balances and transactions. 

[longtimelurker]

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@crystal626 wrote:

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@Horseshoez wrote:

@CreditCuriosity, I'm good with due dilegence, I'm not good with sharing tax information.

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Exactly. I would happily provide bank statements or my Social Security award letter (which specifically says it is to be used for the purposes of getting credit) but there aren't many banks I'm willing to give my taxes to, same for these services like Plaid and Yodlee that watch my account balances and transactions. 

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I think for many the decision not to give tax info is more a matter of principle than anything else.   Most of us don't have anything particularly interesting on our tax returns that wouldn't be revealed by bank statements or pay stubs etc, banks just prefer to be able to go to the IRS so they don't have to worry about authenticating the info we would otherwise provide.

But these discussions will continue as long as there are issuers that tend NOT to require such things, so that those that do look intrusive.  I haven't seen many complaints about mortgage companies demanding such things:  yes, it's usually a lot more money, but it is secured so the risk is much less.  It's just that nearly all companies require this, with no documentation loans being more expensive.

Caveats:

1) Yes, I know there are things on the transcript, such as disability status of spouse or child, and apart from the fact that this shouldn't matter, these individuals may not be on the card at all.   Similarly income of spouse if household income wasn't part of the application.

2) For a few individuals, such as say DJT, there are concerns about the information becoming public, for the most of us, the banks probably won't find someone willing to pay for a leak!

3) If your business life is, um, close to the edge, you can always just not report that sort of thing.  The IRS always likes to invoke Al Capone, but hey, one guy, a long time ago!