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Tuesday, January 14, 2014

Social Media and Your Loan Application


How your social media activity can torpedo your loan application-- from Naked Security




We already know that social media missteps can, say, bury our chances for getting hired or get us arrested if we brag on Facebook or Twitter about what bad-ass burglars we are.
Hang tight: there's actually a whole new world of d'oh! opening up.
As the Wall Street Journal reports, our Facebook friends, our Twitter musings, our eBay or PayPal accounts, our cookies, our browser behavior, and/or our smartphone use are increasingly being used by financial services outfits that are using our online selves to figure out whether they should loan us money or extend our existing credit lines.
The WSJ's Stephanie Armour writes that the horrifically embarrassing things some of us stumble into posting include financial details that could get our credit applications denied, such as whether the job information we put on our loan applications match what we posted on LinkedIn, or whether we posted about our employers firing us.
Small businesses, for their part, may well be turned down for more credit if they get lousy reviews on eBay, lending companies told the WSJ.
At this point, it seems that many such institutions are giving customers the social-media once-over on an opt-in basis, often using the information as one more way to get credit to borrowers who might otherwise have difficulty getting a loan, though banking experts predict that it's likely to become more pervasive and less opt-in than that.
For example, at one such business, the mobile-only bank Moven, customers can opt to link up their Facebook, LinkedIn, and/or Twitter accounts to learn about their own financial behavior and make payments to friends.
Moven is planning to offer loans, and customers' activity on social media will be one factor in making those underwriting decisions, the bank's president, Alex Sion, told the WSJ, noting that you can get a much better read on creditworthiness that way:
The data we have on customers via social networks says more about them than their FICO [credit-score rating]. … You can make credit decisions based not on a faceless score, but on who you know.
That "who you know" is quite literal, as in, the information provided by your social networks.


Read more at the link above.

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