Are your social-networking habits effecting your borrowing power?
Unless you’re Donald Trump, you probably need third-party money to close some deals.
As real estate investors, we want to make the most of our borrowing power. But is it possible your social media habits will effect your next loan?
Yes, it is possible.
Rumor has it banks and lenders are gathering intelligence through social media and how they intend to use this information is debatable. Let’s take a deeper look at what is being collected, how it may be used and what you should do about it.
Banks and lenders have always assembled data to determine one’s ability to pay. Traditionally the sources have been credit reports, pay stubs, previous years taxes, bank statements, co-signers and so forth. Now, one’s “social-graph” (online relationships and habits) may have an impact on a lender’s willingness to extend credit.
Does your social media presence reflect financial distress? Do you have friends who are in distress? Are you changing jobs? Moving back home? Buying a new car? Planning a wedding? Taking a dream vacation? Getting divorced?
Your financial situation is greatly reflected in how you live your life. Nowadays, people are sharing their life stories through social media, which is creating a more connected world. But it’s also offering financial institutions (not to mention employers and business associates) a whole new world of insights into things that may not improve your chances of getting that great loan or employment offer.
For legal reasons, the likelihood of an individual’s social sentiment dictating borrowing power is slim. However, word on the street is that banks and lenders will use this information to better direct their marketing efforts. Those with higher social rankings, within their internal system, will get better offerings than those with less favorable profiles.
We have limited this to just banks and lenders; however, this same approach could certainly be applied by potential business partners looking to finance one of your deals. Obviously, as real estate investors, we want the best offerings and here are some tips to preserve your social sentiment.
- Have secure privacy settings
- Be conscience of what you post and how it could be interpreted
- Understand that you are trackable in the digital community
- If you are not paying for a service, then you (that is, your information) are the product
Social media has created a small-town world and allowed meaningful relationships to develop virtually. This is a powerful thing, which means there is potential for both good and evil – so be conscious of how you use and participate in social media.
Remember, EVERYTHING you put on the internet has the potential to be seen by ANYONE and can live FOREVER. As an investor and entrepreneur, it’s essential to be diligent in building and protecting your personal and professional public appearance. Make sure what you’re putting out there consistently presents the public image most advantageous to your investing and business goals.
Staci Davidson is a social media strategist, coach and consultant. For more information, visit www.stacidavidson.com.