Should Social Media Affect Your Creditworthiness? 344
theodp writes "Betabeat's Adrianne Jeffries takes a look at the questionable young science of using social media to evaluate creditworthiness. As banks start nosing around Facebook and Twitter, Jeffries explains, the wrong friends might just sink your credit. 'Let's take a trip with the Ghost of Christmas Future,' she suggests. 'The year is 2016, and George Bailey, a former banker, now a part-time consultant, is looking for a 30-year fixed-rate mortgage for a co-op in the super-hot neighborhood of Bedford Falls (BeFa). He has never missed a loan payment and has zero credit card debt. He submits his information to the online-only PotterBank.com, but halfway through the application process, the website asks for his Facebook login. Then his Twitter. Then LinkedIn. The cartoon loan officer avatar begins to frown as the algorithm discovers Mr. Bailey's taxi-driving buddy Ernie was once turned down by PotterBank for a loan; then it starts browsing his daughter Zuzu's photo album, 'Saturday Nite!' And what was this tweet from a few years back: "FML, about to jump off a goddamn bridge"?' So, could George piggyback his way to a better credit score by adding Larry and Sergey to his Google+ Circles?"
No, obviously (Score:5, Insightful)
And in the EU there are data protection and privacy laws that could be used to deter this kind of thing.
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You think letting them kiss your ass will make them give you a loan?
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Depends how hard they bite...
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How about these banks kiss my private shiny ass!
Nobody kisses the ass of a private. Usually you have to make Sergeant or better.
Re:No, obviously (Score:5, Interesting)
It's the satisfied feeling of being able and educated enough to elect the right person in the right office, and hold the elected people responsible for what the government does. If you don't expect anything from the government, then you can't expect anything from your goverment.
Remember people: In a democracy, you get the government you deserve.
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Well, that's the theory.
Alternatively the Supreme Court simply hands the election to the loser, or the voting machine manufacturer (who also make ATMs that can track money very accurately) produces machines that mysteriously can't seem to work a simple incremental counter...
Or lots of those machines are sent to rich, predominantly white districts while fewer are sent to poorer, disadvantaged areas. Just to double check they they can't vote you post flyers in that area deliberately giving the wrong polling d
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Right, and when no one but dirt bags run for office?
Whose fault is that? Why aren't YOU running for office if the available choices are so bad? What are YOU doing today to help shape the leaders you want tomorrow?
The easiest thing to do is sit around crying and whining and blaming everyone else for your unhappiness.
Re:No, obviously (Score:5, Insightful)
It's also easy to trot out the old "run for office yourself!" trope which ignores much of modern reality.
Anyone not corruptible or already immoral will lose out to the sociopaths and insiders. That fault is the media that ignores issues (beyond a very shallow level) and goes after the dirt, incessantly and with a blood rage. You need to absolutely not give a shit what anyone thinks about you or says about you to survive.
I've worked on campaigns in the past at a high enough level to interact with the candidates. I've seen it first hand. Above city council positions for *small* cities, your typical "nice person" is eaten alive and spit out so fast it's just a blur. And we have small towns here in California that have been revealed to be corrupt warrens of asshats. Any outsider who challenges them is put down quickly via lies and outspending thanks to all their cronies in local business interests and public employee unions. What's that? Businessmen and unions are enemies? Ha ha! You're a silly pony!
This has been going on in one form or another since the year dot. The power structure has been breeding these monsters for millennia.
Not everyone is so lucky (Score:4, Funny)
At least George has Clarence as an angel investor.
That bank would be bankrupt fastly (Score:5, Insightful)
Everybody that uses social networks have connections to somebody that gone broke, or made bad comments on the past. That fictional bank wouldn't be able to lend money. Thus wouldn't generate any revenue.
Searching social networks will probably happen on the real world, but you can bet the information the banks will gather will be way saner than that, and they won't jump to conclusion that fast.
Now, about the real problem. Why is everybody so concerned about their credit worthness?
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We're concerned about our credit worthiness because the banks, other lenders, employers, etc are.
I, for one, liked having a 3.85% APR on my credit card before the economy went down the crapper.
Re:That bank would be bankrupt fastly (Score:4, Interesting)
Technically, I am more well off than most of the western world, simply by having no money and no debts. It is the very definition of "wealthy" nowadays.
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mod parent up (I would if I hadn't already commented). People get pissed off when they show me their shiny new laptop they got on finance, and I'm like "Well, you see this four hundred Pound Toshiba? I own it, lock stock and fucking barrel."
How did I manage that? Hard work and sensible spending. I have NEVER had a loan in my life, I don't WANT a loan ever. Hell, I don't even have a bank account. Everything I see in my home and in my garage, I OWN.
Credit breeds complacency and laziness. OK so when banks go u
Comment removed (Score:5, Insightful)
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Re:That bank would be bankrupt fastly (Score:4, Insightful)
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Of course, the risk of skimming is entirely the fault of the banks. It wouldn't take technology more advanced than that found in a typical pocket calculator to replace credit and debit cards with something that uses a hidden key (possibly additionally protected by a pin, which you would type in on your own keypad). In other words, cheap technology that's been around for thirty years or more. Sure it would be a little bulkier than a typical credit card, but there's no reason you couldn't have one device that
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The difference is, quite a few banks will allow you to use a debit card to overdraw your checking account. A couple of years ago, someone got my debit card number and managed to empty and overdraw my checking account by about $1,800 within about 3 hours. It took the bank 3 days to provisionally credit me back to zero so I could at least cash a check from my parents and have cash to live on until they finished their full investigation and credited back all the fraudulent charges. In the meantime, I had sched
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I typicially do... however, there are the odd times when I have greater expenses than I have available cash for the month. In August, I bought a new car. By tapping my credit card, I was able to put down a much larger down payment, which resulted in a considerably more favorable car loan. I saved a lot more on the lower interest car loan than I lost over the three months it took to pay off that down payment on my credit card. If the card still had 3.85% APR, I would have bought the entire car on it.
I al
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Re:That bank would be bankrupt fastly (Score:4, Interesting)
This shouldn't matter. If you're using your credit card as a source of credit (instead of as a debit card), you're doing it wrong.
Really? In 2008, I make nearly 4k by using my credit card as a source of credit. I had more than 100k credit borrowed from credit cards at 0% + no fee, and stashed it in savings accounts returning >3% interest. I never realized I was doing it wrong. Thanks for correcting my mistake.
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That's good for you, but you have to really keep on top of the credit card companies to make that work. I paid off a higher balance card with a 0% introductory offer from Bank of America. First of all, they get you with fees
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I wish. At least then I'd probably be posting this from my yacht or something.
Seriously, though...once everything crashed, savings interest rates when to shit, credit company's went into panic mode and cut credit lines drastically (amex was the worst, cutting my credit limit from $25K to $500 in one swoop), and that free money gravy train pretty much dried up.
Re:That bank would be bankrupt fastly (Score:5, Interesting)
You must be from Europe. Over the past 20 years in the USA (and I think Canada) a person's credit worthiness is everything. Both positive as well as negative information is reported and not having a decent credit score can negatively impact your quality of life. It is not at all uncommon for potential employers to investigate prospective employees' credit scores. As an American I find these increasingly intrusive trends in the US quite disturbing as it all seems to somehow fall under employers' rights to "free speech" as everything seems to be a "public record" these days. What the US needs are EU style data protection laws.
Re:That bank would be bankrupt fastly (Score:5, Insightful)
Now, about the real problem. Why is everybody so concerned about their credit worthness? You must be from Europe. Over the past 20 years in the USA (and I think Canada) a person's credit worthiness is everything. Both positive as well as negative information is reported and not having a decent credit score can negatively impact your quality of life. (...) What the US needs are EU style data protection laws.
You don't have to be from Europe to see the lies behind the current system of credit in America. The whole thing is designed so that people must have debt in order to beg the banks for more debt. It's absolutely crazy. If we teach our children to save for the things they need (and do so ourselves) we could end this horrible economy for good. Sadly people are too intoxicated by instant gratification (i.e. selfishness) for that to ever happen on a grand scale. What the US needs is a bat-symbol-in-the-sky sized CLUE.
Dinging good credit to jack up interest rates (Score:3)
What bothers me is that they seem to be looking for ways to lower credit scores of people who have good credit scores. It seems obvious to me that this has nothing to do with borrowing and repayment, as they want to keep linking in items that are not related to borrowing and payment history or income. They made a run at using driving records to contribute to credit history, and now social networking.
Their statisticians claim these are relevant, but if they are, why doesn't borrowing and payment history re
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In fact, the formula favor having access to lots of debt that isn't utilized.
Sorry, I sort of said this wrong. I didn't mean to imply that having more credit available will necessarily increase your credit score. One of the factors taken into account is your credit utilization. This is the outstanding balance divided by your total available credit. A lower utilization is better to some degree. A 1% utilization probably isn't going to score any better than a 2% utilization, but it most certainly will score better than a 80% utilization. So, having a $500 credit limit and using $400 o
Re:That bank would be bankrupt fastly (Score:4, Insightful)
I suppose we could break it down into two questions:
1. Is using social-network data to evaluate creditworthiness actually accurate?
2. If it is accurate, do we think doing so is a good or bad thing?
Your point is about #1, but I think probably there is a way, given good enough statistical analysis, to extract a good predictive signal, so the real long-term question is not whether it works, but whether we should let it be used.
You don't understand the Major in Major depression (Score:2)
From TFA:
in 2009 a woman in Quebec stopped receiving disability payments for major depression after Manulife decided, based on beach vacation photos on Facebook, that she seemed happy enough to work after all.
There's no mention of any further investigation, but this sounds like jumping to conclusions to me.
Well, it depends on what she told the insurance company. Major depression is a massive brain malfunction, the kind where many sufferers can't even get up out of bed for hours or days at a time, and not because they feel so miserable that they don't want to; they actually can't get up. Even major depressives can have good days, but if she told them she had catatonic major depression and never left the house (which would be plausible), and they saw recent photos of a smiling beach vacation, that would be a v
Identity? (Score:2)
I Wonder (Score:2)
Re:I Wonder (Score:4, Interesting)
Facebook has "shadow accounts" of people it's datamined, but have not actually opened a facebook account with. So even if you don't have an account, your friends & family talking about you, or any data it harvests that contain references to you, are stored there.
I would suspect that Facebook's sharing of information with legal authorities includes shadow accounts, and if banks or credit reporting agencies strike a deal with Facebook to get at "indicator" information about people, they'd be able to view shadow accounts as well.
Re:I Wonder (Score:4, Funny)
I would suspect that Facebook's sharing of information with legal authorities includes shadow accounts, and if banks or credit reporting agencies strike a deal with Facebook to get at "indicator" information about people, they'd be able to view shadow accounts as well.
Good point. In Soviet Russia, facebook account has you.
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ISR is right on the mark. Facebook's shadow accounts contain a LOT of information.
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I know 3 people named Steve Wright. How does Facebook know which one I'm referring to at any particular time.
And how many John Smith's are there?
Now for sure, if I send a facebook invite to one of them, then Facebook have an email address. But that's about it for data they can collect about people with no account.
Oh, and facial recognition in photos won't do it. iPhoto has facial recognition, but I'd estimate it's suggestions are only about 60% right, even after all the training it's had from my confirmatio
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I know 3 people named Steve Wright. How does Facebook know which one I'm referring to at any particular time.
That is *exactly* the problem that data mining techniques solve (or at least give reasonable guesses).
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I'm frequently entertained by the fact that Googling "Facebook " gives three links to Facebook, none of them me.
I'd probably be less entertained if my namesakes were not really cool, interesting people with great careers.
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Gyah.
Facebook <my real name>
Sure, why not (Score:2)
I mean, after all, you're borrowing their money. You don't have a right to it.
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You are not borrowing it yet, if you just ask them. So they don't have any right to any data about you yet either.
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You're not borrowing their money - they don't have any. What you're purchasing (you pay through interest) is a book entry. Credit is fraud. But it's not fraud for the simple reason that it's done through a bank.
Lolwut? (Score:5, Insightful)
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This. Don't expect privacy when you willingly give up your passwords.
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Tomorrow the bank might want your password. In 30 years they won't need it. They'll use some internal app that's connected to every social network's back-end API, and the sites will be happy to share all the data they ask for... for a nominal fee. And it'll be 100% legal because there's a clause that says they can somewhere in the petabyte of dense legalese nobody downloads, let alone reads that is Facebook's 2041 user agreement.
I don't care.. (Score:2)
This is already a reality! (Score:5, Informative)
The company iZettle, which provides "personal payment" via credit cards (chip reader that plugs into phone+app),
requires not only traditional autentication and a bank account - but also your facebook profile with an established social network. I.e. you must have friends as a voucher for your identity.
No facebook, no service. True, they dont base credit reports on your profile, but I find it a disturbing development where traditional identification and bank account are not enough (especially here in Sweden where we already are tracked since birth with the personnummer supercookie).
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You don't even need a group - I can create as many facebook accounts as I care to. I'm sure if they get logins to 300 accounts from one IP they'll catch on, but are they really going to look for every IP associated wtih 20 accounts and investigate it to see if it is a NAT?
They're all indicators (Score:5, Insightful)
This isn't going to be particularly pleasant to hear, but ultimately these sorts of activities are all about finding indicators of your likeliness to default on your credit, in much the same way that indicators are used when providing insurance to evaluate someone's likelihood of needing to make a claim and price them accordingly. So having these extra indicators isn't by itself necessarily bad. It's not in the lender's interests to come up with bad indicators. To stay competitive, they have to strike a good balance between covering their ass and giving you a better rate than the next lender. So ultimately they're trying to find out something about your creditworthiness (as a probabilistic measure of default) that is more likely to be right than wrong.
The real philosophical issue is, if non-financial indicators are used to evaluate our creditworthiness, then are we being unfairly induced to make changes to our lifestyle to accomodate our need for credit?
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They may be insulated from the consequences of ignoring good data, but there sure as heck isn't any benefit to gathering bad data, which is the point I'm trying to make.
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If federal bailouts are distorting the markets, that's a problem with federal bailouts. When making a bad loan really does cost you the amount of the loan, people get pretty smart about figuring out who to lend to.
But if legal bribery is distorting federal accountability . . .
G+ Circles (Score:2)
The problem with Larry and Sergei is not G+, is plain google (or any othe
Not a hypothetical question... (Score:4, Interesting)
Insurance companies are infamously snoopy and manipulative. They'll look at anything and everything they can possibly get their hands on, legal or not, to analyze your risks. I'd bet serious money that insurers already pry in social networks.
And they've managed acts of regulatory capture that would make even banks and defense contractors blush. Here in North Carolina you're not even allowed to have a driver's license unless you have car insurance. If you don't actually have a car that's tough shit; you can't even drive rentals or borrowed cars.
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Insurance companies are infamously snoopy and manipulative. They'll look at anything and everything they can possibly get their hands on, legal or not, to analyze your risks. I'd bet serious money that insurers already pry in social networks.
For close to a decade it's been well-known in motorsports circles that car insurers will snoop around on motorsport forums to see if any vehicle they insure is driven in any kind of competition. There are a few well-documented cases of people having their insurance cut off this way. There have also been rumors of them sending agents to events.
Keep in mind that pretty much all insurers already exclude anything that happens in competition, and that you would have already paid into competition insurance, so ev
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Non-owned auto insurance (Score:2)
is available usually very cheaply. That would meet the insurance requirement.
As long as it's averaged with Slashdot karma (Score:5, Funny)
Please mod me up, I want to refinance!
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Well, we can't give you a loan on your Slashdot karma, but if we just put down - this'll be our little secret, just you and me - that you've got 2 million reddit karma - it's okay, reddit karma doesn't mean anything, it's just an arbitrary thing we have to work around, you could get that karma for real easily enough - there, you're good to go for your eight trillion dollar home improvement loan to build a moonbase.
NO (Score:3)
Frankly, I think Social media sites should not be used to judge someone for credit worthiness, or for jobs or for marking someone's abilities to perform work. People have lives that are not always accurately reflected from social media sites.
People do things in there personal time that is there personal time. This should not be used against you.
Conversely, people who don't post on social media sites should not be scrutinized either for their lack of personal info on the Web.
Credit worthiness is based on one's abilities to pay their debts incurred. Credit rating companies already provide this info.
While I think the way Credit agencies horde data on an individual is appalling, it does have the ability to show patterns in people and their spending.
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You let your insurance company use your credit rating to assume how safe of a driver you are.
You have a Credit score of 650? You must be a maniac that sideswipes people for fun, You must be charged an extra 60% on your insurance.
Everyone knows that is raging BS, yet none of you are outraged by it or will get off your butts to complain about it.
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If only they knew...
Search for AC (Score:4, Insightful)
Dear bank, sorry, I can't give you the login directly, privacy you know. But (wink, wink) you can find them - just Google for my nickname "Anonymous"...
Not a problem... (Score:3)
You give it your professional ones not your personal ones.
Honestly what idiot is posting everything professional and private to the same profile?
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People who don't need to have a false persona for work. That is, I grant you, a minority. But it makes for a much happier life for those that are in that position.
I see positives here, not negatives (Score:2, Insightful)
If you have a credit history, the bank is going to use that to determine whether to give you a loan or not. Paid off all your debts? Make more money than you spend? Never had a late payment? Banks will be falling over themselves to lend you money. Defaulted on everything? Bankruptcy? You're going to have some high interest rates.
What I see here is a tool banks and credit unions could potentially use to inform them about people without a credit score. Maybe I haven't had a credit card or mortgage before, but
Makes no sense. (Score:5, Insightful)
NO (Score:5, Insightful)
Absolutely not. I'll tell you why: There is currently no way to verify who you say you are on social networks, hell, some of them you can sign up with a fake, made-up name... all you need is a valid email address which can be anything. Oh, and that email address can be webmail, which also does not attempt to verify your identity. This makes it incredibly easy to set up fake accounts or profiles in someone else's name.
Absolutely NONE of these services have a way to accurately verify your identity. They don't even try for the most part. This alone means that searching for Bob Smith's facebook page does not guarantee that I find the real Bob Smith's facebook page. Or that anything posted or linked to Bob's profile has any accuracy whatsoever.
Stuff can become attached or linked to your social media profile, even without your knowledge. Character assassination anyone? Someone you know (or even don't know) can take a picture, post it online and tag it with your name, and there is absolutely no way to verify who is in the picture. I can take a picture of my cat taking a dump and post it, tag it with a friends name, and this will then get linked to their profile.
Do you see the problem with this? If a prospective employer or a credit service wants to search for my name on social media sites fine, but I expect they will be smart about actually using unverifiable information to determine my credit or job worthiness. The mere act that they would use unverifiable data to back up a decision on something important like a job position or a credit score, tells a lot about the company. Luckily I live in the EU where this sort of thing is not widespread and we actually have strong personal data protection laws.
Re:NO (Score:4)
That problem suggests its own solution: poison the well by pre-emptively polluting Facebook etc. with fake profiles carrying garbage (but non-specific, non-damaging) information. As an upside, it'd devalue the database for other data-mining efforts too.
Should it? No. Will it? Yes. (Score:2)
One constant of humanity is their ever willingness to look for any metric with which to divide themselves into lessers and greaters.
Why would they ask for your Facebook et al log in? (Score:2)
After all, Facebook is already selling that info.
You providing your profile information for free is probably a Facebook TOS violation.
Credit risk (Score:3)
"but halfway through the application process, the website asks for his Facebook login. Then his Twitter. Then LinkedIn."
This seems like a fair data point for determining credit risk. Anyone stupid enough to actually enter this information is definitely a credit risk! The same goes for employers or potential employers who are starting to ask for this; if you are dumb enough to give them login credentials to your accounts then you are a security risk.
As for the rest of the article, I don't think the information on your social media sites is the least bit reliable for determining credit risk so financial institutions should not be using it.
Oh no... (Score:4, Funny)
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Just like car insurance, you can get a lower rate if you put their little black box in your car to let them record your driving style and locations. Living privately in the future is gonna be bloody expensive, I gotta get a better paying job and save up...
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...or just do what every other fucking sheep does and get a loan.
Re:News for nerds, stuff that matters (Score:5, Insightful)
What am I not understanding? This story seems relevant to me. If you don't agree, you are free to click on a different story.
Re:News for nerds, stuff that matters (Score:5, Insightful)
What am I not understanding? This story seems relevant to me. If you don't agree, you are free to click on a different story.
Really? How is this relevant:
"He submits his information to the online-only PotterBank.com, but halfway through the application process, the website asks for his Facebook login. Then his Twitter. Then LinkedIn."
First, Banks don't investigate you, they just check with the Credit Agency.
Second, this would require a change to what is allowed to count against your credit score, credit rating companies cannot just arbitrarily pick random shit.
Next, this would require a wholesale change in the entire way our society handles private contracts. Giving the logins above would be a breech of TOS for all those sites just to start with.
Additionally, this would require a complete 180 turn in regards to the Computer Fraud and Abuse Act. Currently if someone were to login using your credentials, they would technically be in violation of the Act as it would be considered Unauthorized Access to a Computer or Network Device, which just so happens to be a Federal Felony.
And Finally, the second any of those things were done there would be a court case challenging the practice on the grounds of Right to Free Association.
So in closing, no this is not relevant, and if you insist on having it then it should be in the Idle section not on the front page.
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First, Banks don't investigate you, they just check with the Credit Agency. Second, this would require a change to what is allowed to count against your credit score, credit rating companies cannot just arbitrarily pick random shit. Next, this would require a wholesale change in the entire way our society handles private contracts. Giving the logins above would be a breech of TOS for all those sites just to start with. Additionally, this would require a complete 180 turn in regards to the Computer Fraud and Abuse Act. Currently if someone were to login using your credentials, they would technically be in violation of the Act as it would be considered Unauthorized Access to a Computer or Network Device, which just so happens to be a Federal Felony. And Finally, the second any of those things were done there would be a court case challenging the practice on the grounds of Right to Free Association.
So in closing, no this is not relevant, and if you insist on having it then it should be in the Idle section not on the front page.
Everything what you say is true if the Credit Agencies play it fair. Unfortunately we all know that they do not give a shit about fairness.
Like it or not, everything about you on Internet (irrelevant if you put it or someone else) will be used against you.
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Re:News for nerds, stuff that matters (Score:4, Insightful)
credit agencies breaking the law in a way that treats individuals inequitably
That's kind of hard to do, since the government wrote the law to protect credit agencies from the effects of their fuckups.
If I told your boss you owed me five million dollars and your boss decided you were a risk and let you go, you'd have lawyers out the wazoo begging to take up a slander/libel case against me. If Experian tells your boss you owed me five million dollars and you lost your job, they're out a mandatory credit report.
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That is true. They don't care about fairness. They only care about putting what is sent to them into their database. Credit Agencies do no digging of their own. They receive all of their information from creditors. The information that is reported to them does not allow for fields such as "Who are these people friends with" or "who have they friended on facebook." The
Re:News for nerds, stuff that matters (Score:5, Informative)
First, Banks don't investigate you, they just check with the Credit Agency.
Never got a mortgage, have you? Well, I recently bought my first house.
Banks check with the credit agency for the prequalification process. After that they require you to submit a record of all your bank accounts and all of your bills. They call your landlord, then they call your employer, and not just for a generic "is he really employed there?" call, but also to grill your boss about what the chances are that you're going to get fired in the next 1-2 years. When I got my mortgage, they had my boss fax them three different statements regarding my employment over the course of one day. One of these was to confirm that I had indeed gotten a raise in the middle of the year, because they had done the math on my pay stubs and decided that the year-to-date earnings didn't match the twice a month salary showing on the stub for the last two months. The difference for the whole year would have been less than $3,000 due to when I got the raise. I could have easily qualified with my pre-raise salary.
In fact, I had a 820 credit score, no debt (but plenty of credit history), and enough money in investment accounts that I could have bought the house outright (inheritance from grandparents). I just wanted to take opportunity of the incredibly low interest rates these days. I shudder to think what the process is like for somebody who actually needs the loan.
Re:News for nerds, stuff that matters (Score:5, Insightful)
Re:News for nerds, stuff that matters (Score:5, Informative)
No. Banks have simply gotten more careful since the recent mortgage industry meltdown. This kind of 3rd degree used to be commonplace. Most people aren't aware of it here simply because they are too young and inexperienced. They haven't been in the mortgage market very long if at all.
This kind of grilling by bankers was pretty common back when they actually cared about you paying back the loan.
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and enough money in investment accounts that I could have bought the house outright (inheritance from grandparents).
Fuck you, 1%.
So you could buy the house with cash, yet you deliberately decided to pay interest instead? You chose, say 3-4% interest or whatever it was over effectively 0% interest? Yeah, you definitely inherited your money.
Hey, AC, ever heard of a little thing called Opportunity Cost?
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Indeed, I've the same thing with a car, dealership offered 0.9% loan for the first year and 1.9% after.
I could bought it outright, but I can do do better than that in investments (Heck for the first year, a simple high interest savings does better), so I took the car loan.
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"In fact, I had a 820 credit score, no debt (but plenty of credit history), and enough money in investment accounts that I could have bought the house outright (inheritance from grandparents)"
must be nice...
It is, and I'm grateful for my parents to have raised me knowing the value of a good education so that I could get a nice job, and I'm thankful for my grandparents who put a lot of thought into saving up money they could leave me to give me a boost in life once they were gone. I've been very lucky with my life and my family, and I miss my grandparents greatly.
I'm sorry if you haven't had similar luck, and I wish you success in the future. I'm not sure what the source of resentment is, though. The entire
Re:News for nerds, stuff that matters (Score:4, Insightful)
“There is this concept of ‘birds of a feather flock together,’” said Ken Lin, CEO of the San Francisco-based credit scoring startup Credit Karma. “If you are a profitable customer for a bank, it suggests that a lot of your friends are going to be the same credit profile. So they’ll look through the social network and see if they can identify your friends online and then maybe they send more marketing to them. That definitely exists today.”
This is about a new wave of companies trying to make inroads into the banking business. This BS story is just them peddling their wares and trying to raise some eyebrows and maybe get a bank or two to give them a serious look. You've got these companies already doing marketing for banks by digging into our social networks, and now they think they can make more money and become that much more important (legitimate?) by actually helping the banks make their credit decisions. 100% wishful thinking at this point. Let's hope it stays that way.
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It's 100% bogus thinking in every respect. I don't know anyof my friends' financial situations, or at least every few. Most of my friends on Facebook are people I know from school (many years ago), from outside activities, etc. My friends from musical ensembles are (slightly) more likely to buy musical instruments and supplies, my friends from work are more likely to buy computer stuff, and the remaining folks are just a random cross-section of the population as a whole.
With the possible exception of my
Re:News for nerds, stuff that matters? (Score:4, Funny)
Inorite?
I didn't think much of "What's your favorite color?" or even "What's your favorite brand of pop?".
But then, out of nowhere it was all "If you *did* have a dead body to hide... where would you put it?"
I probably should have lied on that one...
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Sounds like a plan, so we live in a cardboard box until we can save the $60,000 to buy a crack house in the hood?
Renting is the same as credit. so I cant rent.
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Renting is actually worse than credit. When you make a purchase on credit you just pay interest on an advance of a sum of money that's quite large compared to the interest. When you rent, you pay a lot of money every month and when you're done renting, the property owner STILL HAS THE HOUSE in better condition than it would be if it were left vacant, in addition to a huge sum of money that you paid over the years! That's how the rich get richer!
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In general, you are right but it is not so simple. You have to factor in a lot of things like maintenance, property taxes, liability into the picture before you decide whether it is better to rent or buy. One big things people forget about is the transaction cost of buying and selling. This can be a significant portion of your cash outlays. Say you put a down payment of $20,000 on a $200,000 house. Brokerage and closing costs can be around $15,000 or higher. If you don't intend to live in a house more than
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Not quite... only *successful* landlords who actually make money are that way. The truth is, it's way more profitable to be a slumlord than to have affluent tenants. If you're a slumlord, you can rent out a shack that costs you $400/month to own for $200/week and pocket 99% of it. If you own a nice house or condo that costs you $1,600/month (mortgage, taxes, and insurance) to own, you'll be lucky to rent it out to someone "nice" for $2,000/month. Same $400/month nominal profit. The difference is, if you're