Social Media and Your Credit Score

Light bulb, lamp, wall street journal
Lenders use social media to determine whether you can keep the lights on.

I am a a big fan of data and infographics! Apparently, mortgage loan officers are, too. This January 8 Wall Street Journal article may make you rethink whether oversharing is an innocuous as it seems:

More lending companies are mining FacebookTwitter and other social-media data to help determine a borrower’s creditworthiness or identity, a trend that is raising concerns among consumer groups and regulators.

Lending companies—some of which are backed with venture funding from Google VenturesGOOG +4.01% the venture-capital arm of Google Inc., and Accel Partners, an early Facebook Inc. investor—are looking at potential problems such as whether applicants put the same job information on their loan application as they posted on LinkedIn, or if they shared on Facebook that they had been let go by an employer. A small business that draws negative reviews on eBay EBAY +0.04%also could undermine its chances of getting more credit, lending companies say.

Small businesses seeking loans grant Atlanta-based Kabbage Inc. access to Amazon, eBay, Xero and other e-commerce or accounting sites to assess creditworthiness. Customers must link at least one such account for underwriting decisions. The company, which has extended more than $150 million in loans since launching in May 2011, also may take Facebook, Twitter and other social accounts into consideration when determining whether to increase a loan, company officials said. Kabbage looks at what customers are saying about the borrower’s business and the quality of its customer service.

“We look at whether you get a lot of ‘likes,’ are you responding to customers,” said Victoria Treyger, Kabbage’s chief marketing officer.


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