BIRMINGHAM, Ala.—There's a new reason to be careful when updating Facebook—as what consumers post on the social media site could lower their credit scores.
Fair Isaac is implementing new strategies for assessing a consumer's creditworthiness. And in addition to looking at the information offered on social networking sites, the company will also be looking at smartphone records, reported Bill Hardekopf, CEO at LowCards.com.
As CUToday.info previously reported, TransUnion is also adding ways to determine a credit score. While the company will not be using social networking websites, TransUnion will add data from payday lending businesses and club memberships.
“Both organizations have said the new data will supplement the current assessments tools, which include credit card and loan records,” said Hardekopf.
TransUnion said its new CreditVision system has been able to approve an additional 24% of consumers for auto loan lenders.
“The new credit assessing system is not necessarily intended to negatively impact credit scores. The new method can also give consumers access to credit,” said Hardekopf. “FICO reported that nearly 18 million Americans don’t have access to credit because they had negative reports in the past. An additional 25 million have never had credit.”
In the report, FICO said, "Using the right alternatives to traditional credit bureau data, lenders can reliably identify millions more consumers who qualify for credit."