Social Media Credit Scores: All you Need to Know
The role of social media has significantly increased in our day-to-day life. From building relationships to providing a platform for business and now determining our creditworthiness, social media has touched every aspect of our life. Since the time news broke that Facebook will allow credit agencies, FICO or lenders to assess your Facebook account and check vital information such as your friends’ credit score to determine your credit eligibility, there is a sense of uneasiness among all the netizens. Seeing the proactive role of social media in the calculation of credit score, financial experts have coined the word ‘social media credit score’. The obvious qualms about social media credit score such as why borrowers need to interfere in your social life and how credit score of your friends may have an impact on your financial decisions needs to be addressed. For better understanding we discuss all aspects of social media credit score in this article. Let’s begin.
Importance of Social Media Data
In this complex world, credit history fails to highlight the real-life situation of borrowers. To find your credit score, borrowers are depended on your credit history which reflects numerical data that may be not same as your real financial position. Hence the viability of social media data. Just imagine, you have just left your job, and this vital information is missing from your credit report. To be well acquainted with all such information, borrowers need to access your social media account where you may write your status as ‘left job’. Such status guide borrowers in determining your creditworthiness. This may sound absurd, but the reality is that while applying for a loan many borrowers hide crucial information from lenders.
Reasons to Worry
The allegation of ‘killing privacy’ is nothing new for social media companies such as Facebook. Although, there is a new concern among netizens regarding intrusion on their privacy by Facebook and other social media companies, there is another much bigger reason to worry. It is related to the inaccuracy and trustworthiness of social media credit score. If credit repair specialists are to be believed there is a real risk that FICO and other lenders may directly jump to a conclusion without looking at your real-life situation. For example, if a person puts facebook status saying ‘he quit his job’, the lender may directly jump into the conclusion that the borrower is jobless and deny him any credit, whereas in reality, he may have another source of income.
Friends’ Credit Score for Your Creditworthiness
Will having Facebook friends with poor credit score impact your credit score as well? Yes, while determining your social media credit score, your friends’ credit score will be taken into consideration. Credit rating agencies or lenders will examine credit score of all the individuals connected to your social media account and calculate their average credit score. In case, an average credit score of all your Facebook friends will be equivalent to minimum required credit score, you will get further credit otherwise, lenders may deny you from any borrowing. In other words, a patent by Facebook allows banks and lenders to access all individuals who are connected to you, which also mean that Facebook is somehow drawing a red line in your friend list.
The way Ahead
Increasing viability of social media and social media credit score in our financial life has made us act more responsibly. There is no doubt that with the social media credit score, calculation of credit score may become more complex and inaccurate, however, awareness and guidance from reputed credit repair agency will save you from many hassles. If there is any question related to how to find credit score using social media, feel free to contact our credit repair specialists.
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