Actually, You Can Judge Books By Their Covers


As it turns out, people are actually pretty good at making snap judgements about the credit worthiness of a potential borrower. A new study by Rice University shows that people who look trustworthy in the eyes of others are likely to have a higher credit score, pay lower interest rates and default less frequently.  

Reuters reports on the findings:

Duarte and co-authors Stephan Siegel and Lance Young, of the University of Washington in Seattle, studied members of, an online lending site where people looking for loans are matched up with individual lenders.

Each loan applicant submitted a profile which included credit and work history, education level, income and an optional photograph of themselves for lender review.

More than 6,800 loan applications, 2,579 loans and 12,200 photographs from were used in the study.

Duarte hired a team of 25 people to rate the applicants’ trustworthiness on a scale of one to five using only the photographs of the borrowers. The team also judged the probability that the borrowers would repay a $100 (72 pound) loan.

Those judged to be trustworthy by the team were more likely to get a loan from lenders and tended to have a credit score about 20 points higher than those determined to be untrustworthy, the researchers found.

“Untrustworthy” borrowers were seven per cent more likely to default on their loan than a perceived trustworthy borrower with the same credit score.

These results held up even when researchers controlled for race, age, gender, obesity, attractiveness and education, as well as financial factors like employment status, income and homeownership.


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