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Post by Deleted on May 19, 2017 15:18:18 GMT
nymag.com/scienceofus/2017/05/what-the-words-you-use-in-a-loan-application-reveal.html"Recently, three economists—Oded Netzer and Alain Lemaire, both of Columbia, and Michal Herzenstein of the University of Delaware—looked for ways to predict the likelihood of whether a borrower would pay back a loan. The scholars used data from Prosper, a peer-to-peer lending site. Potential borrowers write a brief description of why they need a loan and why they are likely to make good on it, and potential lenders decide whether to provide them the money. Overall, about 13 percent of borrowers defaulted on their loan. It turns out the language that potential borrowers use is a strong predictor of their probability of paying back. And it is an important indicator even if you control for other relevant information lenders were able to obtain about those potential borrowers, including credit ratings and income. Here are the phrases used in loan applications by people most likely to pay them back: debt-free, lower interest rate, after-tax, minimum payment, graduate. And here are the phrases used by those least likely to pay back their loans: God, promise, will pay, thank you, hospital." Fascinating insights of how we're being profiled by big data.
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Jun 1, 2024 9:11:22 GMT
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Post by Deleted on May 19, 2017 15:48:16 GMT
Very, very, interesting. Thanks for sharing!
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Post by busy on May 19, 2017 15:51:04 GMT
I heard an interview with them recently on a podcast and it was super interesting.
Anecdotally, my experience as a commercial lender strongly agrees with their findings.
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Post by **GypsyGirl** on May 19, 2017 15:53:34 GMT
Interesting! The 9 page thread currently going would seem to support these findings.  |
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Post by compwalla on May 19, 2017 16:03:28 GMT
People counting on Jesus to help with their loans have forgotten he was a penniless radical and not a financial wizard. *snort*
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Post by Deleted on May 19, 2017 16:03:52 GMT
Interesting! The 9 page thread currently going would seem to support these findings. I thought the same thing. Also the "believe me" tell - which almost always lets you know the next words the person is going to say are lies. |
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Post by papersilly on May 19, 2017 17:05:56 GMT
Also the "believe me" tell - which almost always lets you know the next words the person is going to say are lies. yup! that and "i'm being honest when i say this..." the other words are interesting too. the word promise always makes me uneasy because that sets the bar and i know some people never get close. |
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Post by femalebusiness on May 19, 2017 17:37:31 GMT
People counting on Jesus to help with their loans have forgotten he was a penniless radical and not a financial wizard. *snort* Warning. May be a *hijack* When my husband was still working (engineering) there was a group of employees that held a prayer group every day at lunch time. They lived, ate and breathed religion. To a person they all made illegal copies of the company software for their personal use and about half never paid back the personal payday loans from the company. Not one of the agnostic non-religious people did that. It got so bad that the owner started refusing to loan to anyone who was religious. There is an entitlement that seems to go hand in and with religion. |
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Post by Deleted on May 19, 2017 17:55:19 GMT
People counting on Jesus to help with their loans have forgotten he was a penniless radical and not a financial wizard. *snort* Warning. May be a *hijack* When my husband was still working (engineering) there was a group of employees that held a prayer group every day at lunch time. They lived, ate and breathed religion. To a person they all made illegal copies of the company software for their personal use and about half never paid back the personal payday loans from the company. Not one of the agnostic non-religious people did that. It got so bad that the owner started refusing to loan to anyone who was religious. There is an entitlement that seems to go hand in and with religion. Broad generalizations are almost always wrong. Problem is, people used to use "Christian" as a shorthand to telegraph "good person" when really there are good Christians and lousy Christians - just like any other religion or non-religion. The bottom line is to not use one attribute to be lazy and put people in a box. Even the predictive "big data" systems referenced in the article are only right a certain % of the time - and they're using LOTS of attributes - Credit scores, income, key words, etc. We need to stop looking for ways to categorize each other easily because we are complex creatures that defy simplistic categorization. And, yeah, that takes more work and effort. Sure, it was easier when people could just lazily use "Christian" to mean "good person" - but it was no more right then than it is now or than it is to use "Christian" as a single attribute to define "bad person". |
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Post by sleepingbooty on May 19, 2017 18:13:21 GMT
We need to stop looking for ways to categorize each other easily because we are complex creatures that defy simplistic categorization - and that takes work and effort. Yeah, it was easier when people could just use "Christian" to mean "good person" - but it was no more right then than it is now or than it is to use "Christian" as a single attribute to define "bad person". Rather than religion itself, it looks like this has more to do with how people decide to present themselves in society as trustworthy people and what they consider to be values to put forward for making a convincing argument. I bet some (probably quite a few) of the applicants who were good candidates for paying back are Christians and/or believe in God, have good manners and make promises to their loved ones but didn't feel like any of these attributes had anything to do with their loan application. Interesting read albeit very much centered on the US culture and not applicable worldwide. Thanks for sharing! ETA: it would be a great subject to take on for how politicians present themselves and how their end-of-term evaluation objectively weighs up to their program. |
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Post by melanell on May 19, 2017 19:34:36 GMT
With no data at all I would have guessed the same outcome if presented with those words. "Please" & "thank-you" make it sound more like a favor or a gift than a serious financial transaction, which is what a loan is. "Hospital" makes it sound like they're trying to give me a reason why they deserve this loan that has nothing to do with their finances. And again, it's a financial transaction, so that's not good Plus, it then makes me wonder if they may be feeling desperate to take any loan to help them right that minute, and perhaps they're not really thinking ahead to the repayment. No matter who was hospitalized, I would be imaging that it has caused them some stress for them to be bringing it up during this situation.  And I don't have any idea what "God" has to do with banking.   The words in the other list sound like the person is asking good logical questions about the terms of the loan, including trying to determine exactly how much they will wind up owing, and exactly how and when they will be expected to start making payments and exactly what those payments will be. They sound like they are going in with their eyes wide open and trying to be sure this will work for them. |
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Post by femalebusiness on May 19, 2017 20:13:32 GMT
Warning. May be a *hijack* When my husband was still working (engineering) there was a group of employees that held a prayer group every day at lunch time. They lived, ate and breathed religion. To a person they all made illegal copies of the company software for their personal use and about half never paid back the personal payday loans from the company. Not one of the agnostic non-religious people did that. It got so bad that the owner started refusing to loan to anyone who was religious. There is an entitlement that seems to go hand in and with religion. Broad generalizations are almost always wrong. Problem is, people used to use "Christian" as a shorthand to telegraph "good person" when really there are good Christians and lousy Christians - just like any other religion or non-religion. The bottom line is to not use one attribute to be lazy and put people in a box. Even the predictive "big data" systems referenced in the article are only right a certain % of the time - and they're using LOTS of attributes - Credit scores, income, key words, etc. We need to stop looking for ways to categorize each other easily because we are complex creatures that defy simplistic categorization. And, yeah, that takes more work and effort. Sure, it was easier when people could just lazily use "Christian" to mean "good person" - but it was no more right then than it is now or than it is to use "Christian" as a single attribute to define "bad person". Yes, it does sound like I was putting all religious into a box but it wasn't intentional. My point was that suspicion is warranted when people need to bring their religion into things like an application for a loan, the workplace or to convince someone they are honest. When inserted into things where religion should be irrelevant it sends up red flags for me. I once heard someone say "Anyone who needs to use religion to be a decent person sucks at being human". That aways stuck with me. Sorry didn't mean to hijack. |
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Post by refugeepea on May 19, 2017 20:24:01 GMT
God, promise, will pay, thank you, hospital Interesting! The 9 page thread currently going would seem to support these findings. Beat me to it! |
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Post by refugeepea on May 19, 2017 20:33:57 GMT
There is an entitlement that seems to go hand in and with religion. My state is one of the top in the nation for fraud because of religion. Actually better to say a few in religion who take advantage of the teachings and twist them to their advantage. Ignore the truth if it is hurtful. Doubt your doubts not your faith. Those in charge over you were called from God. Follow what they say. It got so bad they had bishops in every ward read a letter from the first presidency (the TOP of the church) warning members of people claiming to be financial advisors, know who they are, their background, and always watch your money. At the time, my brother was a bishop who is legitimately a financial advisor for well over 20 years.  |
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And I don't have any idea what "God" has to do with banking. 
