Is Facebook Destroying Your Credit?

As more of your life becomes public, thanks to social media, it is possible that banks, credit card issuers and other lenders will become interested in what’s going on in your life — stuff that may not be on your credit application. While it will be harder for credit card issuers to raise your interest rates soon, the bottom line is that lenders can find reasons to start you off at a higher interest rate because of your risk profile. And social media — Facebook, Twitter, and more — is becoming a vital part of your overall creditworthiness profile, even though it doesn’t actually affect your credit score (yet).

Here is what has to say about the up-and-coming trend of using social media as part of the credit screening process:

Creditors are checking out what you post to your Facebook and Twitter accounts. They’re checking out who your friends are and who the people are in your networks.

The presumption is that if your friends are responsible credit cardholders and pay their bills on time, you could be a good credit customer, according to

San Francisco-based company Rapleaf monitors what people tweet or post on Facebook and compiles what it calls social graphs of your likes, dislikes, strengths and weaknesses.

You can see that what you post on social media is being used for marketing purposes, as well as — possibly — for lenders to figure out whether you are likely to be a responsible borrower. In an increasingly public world, what you post has a way of coming back to you. And with lenders becoming savvy with social media, it’s possible that they find that Tweet about your spending binge last weekend, or see that your Facebook friends have been missing their payments. All that could reflect on you and result in a rejected loan application.

Check your privacy settings.

And remember that what you post on Facebook or Twitter is there for all the world to see.