Could Facebook be Affecting Your Credit Score?

Could Facebook really be affecting your credit score?  That seems like a dastardly question; after all, how could a site used to interact with old college friends, swap marathon or baby photos, and post your personal response to the latest “Walking Dead” episode have any bearing on your credit score and merit for getting a loan?  Unfortunately,  the question isn’t so ridiculous after all, as several companies have started using Facebook to make such loan determinations.

You can find more information about what’s all legally allowed in your credit score by reviewing the Fair Credit Reporting Act.

Old Dog, New Tricks

The credit report started over one hundred years ago as a means of vendors getting together to share information about which customers are more likely to pay off their debts, often taking into account personal bias and character references. And while the Fair Credit and Reporting Act has upped the standards that make your credit scores, it appears as if old determinants of credit worthiness are back again.

According to a report from CNN’s Money section, many companies, such as Lenddo, are leaning towards data gleaned from social sites such as Facebook to determine the probability that a loan will be paid back. Their theory is that your social interactions–and social circles–are one of the best indicators of credit worthiness.

Choose Your Friends Wisely

Remember when your mom used to say you couldn’t hang around so-and-so anymore because they were a bad influence? Well those days appear to be back.  Apparently, many of these companies are looking not just at your credit history but the credit history of your friends to determine if you’re  qualified for a loan–because as we all know, friendship is based off financial responsibility and not things like trust or common interests.  So if you’re in the market for a loan, better take some time and cut ties with those friends of yours who might be struggling, less you fall.

But That’s Not All

Apparently Facebook isn’t the only source for compiling your credit information. Creditors such as Kreditech have even been looking at consumers Amazon and eBay activity as well to help make their determinations.  The company even takes data into consideration based on how you apply for the loan, taking into account how fast you fill it out and even your casing choices. So keep the caps lock off!