Ways to Use Social Media For Note Investing Due Diligence

[Tracy Z. Rewey]

I heard an interesting statistic at the IMN Note and NPN conference last week. One of the panelists (Jeff Freud with United Asset Management) mentioned they had found something like a 20% improved chance for getting a note performing when a payer was participating in Social Media. Basically they run a Google search on a person and when it returns various social media profiles rather than just ads for skip tracing type sites they see that as a more positive indicator for performance. Of course it is just one of many factors but it made me curious...

How are other note investors using Social Media as part of their due diligence when buying notes?  We've used it to "check someone out" or help "find them" on a note with performance problems but this takes it to a different level.  Thoughts?

[Tracy Z. Rewey]

Originally posted by @Odie Ayaga:

@Tracy Z. Rewey they don't hazard a guess as to why that is I suppose? @Jay Hinrichs I just met a guy at a convention last weekend who said he does something similar

 Odie, I've become a bit obsessed with this idea so have been researching online.  There is a great free white paper report published on the general idea.  If you search: PWC Social Media In Underwriting Process - you should be able to find it. Basically the premise is that people more connected with friends and family are less likely to default. They outline a variety of factors that can influence the credit worthiness including:

• Strength of Social network
• Photo content
• Location Sharing
• Level of connectedness
• Quality of friends and professional networks
• Jobs listed within profiles
• Willingness to participate in financial training or tracking
• Identity verification

We work with a lot of payors that do not have any type of credit score or minimal histories.  I see social media as a potential resource for both insight and verification.