How many times does the word “wasted” show up in your social media profiles and posts?
What?! You don’t know?
Even if you’re not sure of the answer, if you are in the US, looking for credit, there’s now a chance that the companies who assess your creditworthiness will.
If you’re planning to get a car loan anytime soon with a sketchy credit history, you might want to check up on your online posts. US credit analytics companies may well be taking a look at your online self to gauge your language and other things they consider indicative of your ability to pay off a credit card or loan, including whether you’ve frequently changed addresses – an indicator that you may have had problems paying rent.
The news comes from the Financial Times, which reports that two of the top credit analytics companies in the US are exploring new ways to assess consumer’s credit worthiness.
One of the companies, FICO, has been working with a dozen US credit card companies on a pilot project that it claims can be used to reliably price loans to millions of people who’ve historically been seen as too risky.
That includes poring over would-be borrowers’ phone and utility bills, change-of-address records, and their histories of DVD rentals and furniture rental.
FICO CEO Will Lansing told the news outlet that those data points are located on a spectrum of consumer data.
On one end of that spectrum is a history of credit card repayment, which is the gold standard of assessing creditworthiness.
On the other end is where they can find our slimy social media trails, which lead to things like posts about how much we hate our jobs; how happy we are to have, say, robbed a bank; our plans for an epic burglary spree; or, then again, all about our drunken binges.
If you look at how many times a person says ‘wasted’ in their profile, it has some value in predicting whether they’re going to repay their debt.
It’s not much, but it’s more than zero.
Subprime loans – those for people who have a higher credit risk – are big business for banks.
Both FICO and TransUnion – another credit analytics company – are turning over rocks to find reasons to make subprime loans.
Jim Wehmann, executive vice-president for scores at FICO:
The market was absolutely hungry for a solution.
For consumers, the new model could translate into better loan terms for people with low credit scores.
There are already scads of reasons to clean up your social media profiles: your employability is one.
Our Facebook profiles, Twitter feeds, LinkedIn pages, or Flickr photostreams are extensions of our resumes and job applications.
We can build them into resources that present us as perfect employees, or we can get fired before we even start a job by a boneheaded tweet.
Now, there’s one more reason: we want a loan. We want to trade in that sputtering lemon we’ve been driving around and get something that doesn’t shed parts like a bad case of metallic dandruff.
Been getting wasted a lot lately? You might want to keep it to yourself!
If you’ve been oversharing, seek out the delete button.
Get in every nook and cranny – of which there are many – where credit-unworthy posts may hide.
Here’s a good article about how to clean up our slime trails for a job application; it’s the same advice for what looks to be coming down the pike for loan seekers.