Good story about bad credit score improves chances of microloan |
|
Washington, May 17 ANI: A new study involving an Indian-origin researcher has suggested that telling good story to cover up a bad credit score can improve the chances of getting a microloan from a peer-to-peer lender. Researchers from Rice University and the University of Delaware found that in peer-to-peer lending, unverifiable information such as personal narratives and explanations affected lending decisions above and beyond objective, verifiable information such as credit scores and histories. Researchers Scott Sonenshein and Utpal Dholakia from Rice University's Jones Graduate School of Business and Michal Herzenstein from the University of Delaware found that micro-lenders were more likely to offer loans to borrowers who explained, and then admitted or denied, the details of their credit history. Indeed, 65.3 percent of all loan requests that included such similar statements were funded, compared with only 45.8 percent of the loans that did not include such statements. "Despite a poor credit grade, the social accounts that borrowers give and identities they create can increase their chances of securing a loan," said Sonenshein, lead author of one of the studies and assistant professor of management. "But relying on those accounts and identities can actually lead lenders to make poorer decisions about which loans to fund," he added. ANI Posted by aniin on Wednesday May 18 reply Comments |
|
<< < 1 > >> |
|
|
||
