Lending Club Increases Interest RatesOctober 14, 2016 | By: deBanked Staff
Delinquencies are up among borrowers with “high indebtedness,” Lending Club said in a document filed with the SEC on Friday. As a result, they’re increasing interest rates by an average of 26 basis points with the bulk concentrated on F and G grade loans.
The announcement comes on the heels of a previous raise made six months ago and another made approximately six months before that. It is not uncommon for the company to make adjustments as trends change.
“Consumers appear to be taking on more debt overall due to low prevailing interest rates,” Lending Club states in their report, citing a Federal Reserve study that observed an increasing amount of indebtedness across student loans, mortgages, credit cards, auto loans, and other forms of credit as of the second quarter 2016.
They’re also tightening up their criteria in such a way that “approximately 1% of borrowers who previously would have been able to obtain a loan under prior underwriting criteria will no longer be approved.”Last modified: October 14, 2016