Your Facebook Friend’s Credit Score Can Affect Your Ability to Get a Loan

Your mom told you to be careful when choosing your friends.  What your mother did not tell you is that “friending” someone on social media will link their reputation to you.  Sounds like a crazy woman is writing this blog, right?  No, just a very cautious one who now understands that who you associate with on-line can affect not only your reputation, but also your ability to obtain credit.  We all know that employers look at our social media as part of their “due diligence” before offering you that sorely needed new job.  Also, that current employers fire employees because of the social media posts.  What was new to me (living under a rock) was that my “private” friends could affect my financial future.
So how do I get from “friending” someone on my social media to having my application to finance a new car rejected?  Start with the basics – Facebook is mining your information (now don’t be surprised, this has been going on for sometime).  They are also mining your friends’ data and tying it back to you.
Facebook has a credit rating patent that allows them to provide lenders data (yours and your friends) that will assist the lender in determining your credit worthiness.  According to this article Facebook will “most likely” not use this data.  Really – are supposed to believe that Facebook would give up a very lucrative income source?  Color me skeptical.
Laurel Papworth, social media strategist and University of Sydney academic, says that lenders in 36 countries are now using Facebook data as part of their tools for approving or rejecting loan applications.

According to CNN “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,” the patent states.”
Read more …   There are lots of other articles are available on this scary topic.

Bottom line – do not “friend” just anyone who asks.  Be selective and keep your social media contacts limited.  Being responsible in how you broadcast your personal information will protect you from both physical and economical harm.

The post Your Facebook Friend’s Credit Score Can Affect Your Ability to Get a Loan appeared first on Diane L. Drain - Phoenix Bankruptcy & Foreclosure Attorney.