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Creditors Using Facebook

Are Your Facebook Friends Affecting Your Credit?

While I've shied away from giving out my phone number at stores, I've never thought too long or hard about rambling off my zip code at the checkout. It always seemed like kind of a non-issue and that there was nothing too revealing or too personal there that couldn't be shared. Truth is, it's actually pretty personal and reveals a lot more than you might think.

Based on your zip alone, retailers can begin to build your profile, which reveals demographic information, like median income, and, in conjunction with more detailed marketing data, can determine your spending habits and your consumer behavior, like if you stop shopping at Williams-Sonoma and start stocking up at Walmart instead. From this alone, a credit card company might cap your credit limit or even close your account.

To find out what creditors are learning from Facebook, keep reading.

So, imagine what creditors can learn from your Facebook profile? Apparently enough to "predict which individuals might be a credit risk by virtue of who they're friends with on Facebook," according to San Francisco-based data mining company, Rapleaf. In the wake of the new CARD Act, creditors are using the same tools you might employ on a job search, relying on your Twitter and Facebook accounts to assess your shopping habits and the shopping habits of your friends. What's more is that if your Facebook friends aren't paying their bills on time, your credit card company might assume that you can't either — guilty by association. What do you make of this practice? Fair to use Facebook or is this out of line?

Image Source: Getty
Join The Conversation
bunnyhorse bunnyhorse 7 years
Definitely out of line, not to mention it's not a very accurate way of judging. I have a few friends who have been irresponsible with credit cards, but I have not!
mom2bella mom2bella 7 years
Facebook has become the new google for me. I use it to look up anyone I hear about in the news or I meet.
Yesi-Jukebox Yesi-Jukebox 7 years
This is way way way out of line!
ElsaBirch ElsaBirch 7 years
I would be curious to know how accurate this is. While where I shop certainly does reveal my personal financial situation many of my Facebook friends and I share little more than a graduating class and have moved on to very different situations... now if they are looking at what my degree is in... maybe that makes sense.
lilkimbo lilkimbo 7 years
I think this sucks, but, I think too many people in our country treat credit as a right, not a privilege. (I'm not saying anyone who's commented here is like that, just saying that it's something that is prevalent in society today.) Honestly, particularly in the case of credit cards (as opposed to home loans or car loans), I believe a company should be able to use whatever information available to them (barring discrimination based on things like gender, disability, sexual preference, race, etc.) to make a decision on whether or not to grant someone credit. I'm not saying Facebook friends are a good barometer or that it's "fair" to use them to assess one's creditworthiness, just that I believe it's well within the rights of the companies to do so.
imLissy imLissy 7 years
I knew them in HS, and I'm curious to see what they're up to. They're friends of my friends. They're family members :P A lot of my family's on facebook now. Don't add them, you get bugged about it until you do.
sourcherries sourcherries 7 years
Oh, and @imLissy, not to attack, just curious--why befriend someone who's not actually your friend? I'll admit, I've got a couple that "I just can't not friend" but wanted to know what other people's reasons were.
sourcherries sourcherries 7 years
Way out of line.
imLissy imLissy 7 years
that insane. My friends spending habits have nothing to do with mine. Besides that, I'm not even actually friends with half the people I'm friends with on facebook.
socalbeachgal socalbeachgal 7 years
I think this is out of line. I thought it was bad when credit card companies cut your credit line by the stores you shop at, guilt by association is going too far.
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