Is it legal for banks or lenders to REQUIRE names and phone numbers of "references" to process a loan?

Answer 1

How can somebody be a reference if you don't give their name and phone number? Sounds pretty basic to me.

Answer 2

Well, it isn't illegal. It is a form of marketing. The only references you are required to give are credit ones. They are already on your credit report. So, if you don't want to give them the other references, then I wouldn't. I'd take my loan somewhere else if they insisted on it. Crazy lenders! As if loans weren't hard enough. Why don't they just treat you kindly and you'll refer them out yourself?

Answer 3

I am not aware of any law that would restrict a bank from asking for "references." It is prudent for a bank to verify employment to ensure that you can repay a loan. If that is what the "reference" is then there is nothing unusual in that request. However, it is unusual to ask for a personal reference and I would be concerned about possible inadvertent discriminatory practices.

Answer 4

Of course its legal and oftentimes it is wise. When people don't have stable or lengthy credit sometimes it provides that additional security for making an otherwise marginal loan.

Of course it isn't illegal for you to find another lender either.

I hope that this helps