Is Your Lender Judging You?

U.S. News & World Report’s Geoff Williams quotes Josh Weiss, our CEO in an article he wrote about how banks use artificial intelligence to make more intelligent lending decisions.

Lenders find it a turnoff when a borrower is in stress. Joshua Weiss is the CEO of TeliApp, a software company that is currently integrating and testing their artificial intelligence engine, Draconis, with two banks. Draconis, Weiss says, “detects and analyzes trends and predicts human behavior.”

You may want to borrow money to reduce your stress, but your stress is what stresses out lenders, according to Weiss.

Banks want to obviously predict which consumers are safer lending risks, Weiss says, adding: “These predictions are done based on their purchasing habits. Not just what they bought, but rather when they purchase the products, where they were when the purchases were made, what succession were the purchases made, there are dozens of valuable data points that, when analyzed, can tell us a lot about a person and their habits; not only purchasing, but even general likes and dislikes.”

So, for instance, don’t max out your credit cards any time soon, even if you plan on paying them back, Weiss says.

“A person who normally maintains a 30 percent balance on all cards for many years and all of a sudden begins to build a balance on that card while simultaneously depleting cash reserves from checking or savings accounts can absolutely produce a red flag,” he says.

Weiss says that one-time purchases like the purchase of a home, car or boat can sometimes convince a lender that something amiss is going on in your life. If you’re buying a boat for the right reasons – you have a pile of money, and life is good – you’re probably fine, according to Weiss. But he adds that lenders also recognize that people sometimes go through rough patches in life, like an expensive divorce or a loss of work that can suddenly make a consumer a high risk.