Under Rapleaf's evaluation system, credit applicants with friends who have generally good credit receive a lower risk evaluation. For consumers with credit scores bordering between "fair" and "good" or "good" and "excellent," a positive Rapleaf report could provide lenders with enough assurance to issue a loan or offer a stronger interest rate. However, the system's critics suggest that social networks containing less creditworthy friends could increase a consumer's risk projection, unfairly subjecting them to higher credit card interest rates. Consumers concerned about the effects of social networking sites on their credit scores may simply prefer to switch their pages to "private."
About the Author
Joe Taylor Jr. is an internal business consultant for a Fortune 500 company, who writes about finance, culture, and design. He holds a Bachelor of Science in Communications from Ithaca College.