Company issues statement condemning increasing practice among lenders of checking consumers' social media accounts to make lending decisions.
SAN FRANCISCO, Jan. 14, 2014 /PRNewswire/ — In the past, assessing risk and determining a borrower's qualification for approval has largely been based on the private data a consumer chooses to share with the lender. According to PersonalLoanOffers.com, increasing lender interest in mining social data from sites such as Facebook, Twitter, Linkedin and elsewhere is a gross privacy concern and should not be allowed to continue.
Companies that are pioneering the practice cite being able to verify job information provided on applications, according to a recent Wall Street Journal (WSJ). The source adding that using alternative creditworthiness scoring metrics helps improve the chances of qualifying consumers who may otherwise have been denied approval.
According to a spokesman for PersonalLoanOffers.com, "This trend of snooping into a borrowers social accounts is a dangerous violation of privacy, and serves neither the consumer nor the lenders to continue this practice."
When asked to elaborate on the lenders, "Social content on sites like Facebook, additionally, are a user created representation, a sculpted personae, and our belief is attempting to make lending decisions based on criteria such as likes, shared financial behavior and other data mined from social networks will be dangerously misrepresentative for legitimate lenders to act upon."
According to the company, The Fair Credit Reporting Act requires the traditional scoring agencies, TransUnion, Experian, and Equifax to verify credit history details for accuracy when disputed. If current trends are allowed to continue, consumers risk being denied funding in a time of vital need based on a flippant remark made in a social setting that never goes away, with no recourse to dispute.
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