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Could your social media activity affect your credit score?

With lenders, insurers and the taxman looking at your social media accounts to make decisions, are you aware of how your online footprint could affect your finances?


Firms are using data from Facebook and other social media websites such as Instagram, LinkedIn and Twitter to find out about customers’ spending habits and earnings as well as to confirm their age, address and employment, according to a recent investigation from Money Mail.

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Their investigation found:

  • Mortgage lenders are cross referencing employment details on LinkedIn and spending habits with other social media sites
  • Insurers will examine social media profiles when considering claims Some car insurance deals are only available to drivers who agree to receive quotes via Facebook
  • HMRC scour pictures as part of their tax investigations if your lifestyle is suspiciously out of step with your income

Social media and your mortgage

The Mail alleges that lenders and brokers are “increasingly looking at homebuyers’ social media profiles — particularly new borrowers with a limited credit history.”

Their investigation claims that mortgage lenders are looking for things like evidence of lavish holiday spending and your work history on LinkedIn to check it matches up with your claims.

However, in the Money Mail’s full report they spoke to a mortgage broker who questioned the validity of such searches.

Insurers keep an eye on your posts for fraud

If you’re submitting a claim with your insurance provider they might scour your online posts to check you’ve not made any false claims.

For example if you claim to have broken your leg but are posting pictures of you hiking up a mountain, you would likely be discovered and investigated for fraud.

Premiums priced by Facebook?

In 2016 car insurer Admiral planned to use Facebook to help price premiums. They were considering technology that analyses customers’ language to decide someone’s risk profile.

However, the plans were negatively received and Admiral dropped them before going any further.

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HMRC will check for lavish lifestyles

If HMRC’s tax inspectors suspect someone isn’t paying the correct amount of tax they’ll check up on their online presence.

They are looking for people whose apparent lifestyles seem out of keeping with their declared earnings.

In essence if they see someone who claims to be on a low income posting pictures of expensive cars they’ve bought and going on luxury holidays, it could lead to further investigation.

Social media credit scoring

The Mail investigation also highlighted new credit scoring companies using social media to help banks, mobile phone providers and other lenders make lending decisions.

Traditionally your credit score is comprised by the big three UK credit referencing agencies: Experian, Equifax and Call Credit.

They calculate your score by looking at your financial and official identity data, they sell this to score to lenders who use it to decide your eligibility for loans, credit cards, mortgages and bank accounts.

But new entrants Friendlyscore “gather data from LinkedIn, Twitter, Instagram, and Google, with the imminent additions of Paypal, and banking APIs” to generate a credit score.

They claim their service can help people who have not yet built up a traditional credit history, and that understanding “who you’re friends with, what you’re interested in, and other habits online can help contribute to a better credit score that gives you more access to financial products.”

For Friendlyscore to work you need to opt in by setting up an account online or downloading the mobile app and choosing which of your social accounts they can access.

Around 10,000 people have signed up to Friendlyscore’s service in the UK, they’ve already created scores for 1 million people worldwide, and they’re applying for a licence from the financial regulator to access bank account data under the new open banking rules that came into effect earlier this year.

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