Social Media and Credit Worthiness
Jackie here. How many Facebook friends do you have? Do you know them all? I recently read an article about how Facebook friends could impact your creditworthiness. It sounded too creepy to be true, so I did a bit of digging. Here’s what I found out.
Facebook Friends and Creditworthiness… What’s the Link?
Several years ago, Facebook started exploring the possibilities of using social media connections to determine creditworthiness. The idea has been touted as a tool to check credit on those without a credit score. But it doesn’t end there. According to some reports lenders may use your profile to check out friends, to share information should you go into default, to determine your odds of repayment, and more.
Facebook even filed patent paperwork that could potentially be used for this purpose. According to CNN Money, “Here's how it would work: You apply for a loan and your would-be lender somehow examines the credit ratings of your Facebook friends. If the average credit rating of these members is at least a minimum credit score, the lender continues to process the loan application. Otherwise, the loan application is rejected.”
Would this work? The CNN Money article author has their doubts, “It's not clear if Facebook would ever try to use the patent for lending, or how exactly it would work. How practical is it for a lender to try to access all the necessary information it needs from your Facebook friends?”
The questions remain, but one thing we do know is that social media may have larger implications than one would initially expect. Be careful what you share. Choose your friends with caution and be sure to check those privacy settings.