Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: jrl on September 22, 2019, 11:00:00 PM
Post by: jrl on September 22, 2019, 11:00:00 PM
Just received this email:
Quote
Quote
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: honvl on September 22, 2019, 11:00:00 PM
Post by: honvl on September 22, 2019, 11:00:00 PM
https://www.lendingclub.com/investing/investor-education/what-are-the-eligibility-requirements-to-invest-through-lendingclub
"At this time, investing through LendingClub is only available to individuals residing in the U.S. Due to current state restrictions, investors who reside in the states below have limited investment access to Notes:
Residents of Alaska, Arizona, Florida, New Mexico, New York, North Carolina, North Dakota, Pennsylvania, and Texas can only purchase Notes through the secondary market. These are known as trade-only states.
Ohio residents aren't able to invest in Notes at this time."
The temporary in the e-mail is a euphemism for "a long time."
"At this time, investing through LendingClub is only available to individuals residing in the U.S. Due to current state restrictions, investors who reside in the states below have limited investment access to Notes:
Residents of Alaska, Arizona, Florida, New Mexico, New York, North Carolina, North Dakota, Pennsylvania, and Texas can only purchase Notes through the secondary market. These are known as trade-only states.
Ohio residents aren't able to invest in Notes at this time."
The temporary in the e-mail is a euphemism for "a long time."
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: TravelingPennies on September 22, 2019, 11:00:00 PM
Post by: TravelingPennies on September 22, 2019, 11:00:00 PM
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: Debt Free on September 22, 2019, 11:00:00 PM
Post by: Debt Free on September 22, 2019, 11:00:00 PM
Reel those lines in boys! Time to find a new fishing hole.
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: Edward Reid on September 22, 2019, 11:00:00 PM
Post by: Edward Reid on September 22, 2019, 11:00:00 PM
If anyone figures out what's really going on, I'm interested. Clearly it's something that happened at LC, not in the states, since several got restricted at the same moment. (I'm in Florida.)
Edward
Edward
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: bkcarolina on September 23, 2019, 11:00:00 PM
Post by: bkcarolina on September 23, 2019, 11:00:00 PM
Time for a little a lot of transparency.
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: Fred93 on September 23, 2019, 11:00:00 PM
Post by: Fred93 on September 23, 2019, 11:00:00 PM
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: TravelingPennies on September 23, 2019, 11:00:00 PM
Post by: TravelingPennies on September 23, 2019, 11:00:00 PM
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: Cam79 on September 23, 2019, 11:00:00 PM
Post by: Cam79 on September 23, 2019, 11:00:00 PM
It might not just be Lending Club, I tried signing up for Prosper and couldn't get past the first step, not available in my area(TX). I checked their availability and Texas isn't listed, although I never tried signing up for them previously.
https://www.prosper.com/plp/legal/compliance/
https://www.prosper.com/plp/legal/compliance/
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: TravelingPennies on September 23, 2019, 11:00:00 PM
Post by: TravelingPennies on September 23, 2019, 11:00:00 PM
Both Lending Club and Prosper still have active licenses as regulated lenders in Texas. I sent a message to OCCC consumer assistance but the worker is out of office until next week. I'll update if I hear back.
Edit:
Looks like the links don't work, you can find them by searching here.
https://alecs.occc.texas.gov/Generic/AdvanceSearch?fromSource=true#
Lending Club
#154127
Propser
#47698
Edit:
Looks like the links don't work, you can find them by searching here.
https://alecs.occc.texas.gov/Generic/AdvanceSearch?fromSource=true#
Lending Club
#154127
Propser
#47698
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: TravelingPennies on September 23, 2019, 11:00:00 PM
Post by: TravelingPennies on September 23, 2019, 11:00:00 PM
A license is not the only thing one needs. One needs to believe one is operating within the rules set by each state. Each state has lots of borrower protection rules. A change in interpretation of one of these rules by the corporate lawyers could easily trigger this. Could be as subtle as a perceived risk that some regulator might later interpret something as not being in compliance with some rule. Could be triggered by a change in a rule, or a particular court case which gave some color to some rule, or a new lawyer bringing a new point-of-view about interpreting a rule. Very difficult to diagnose from a distance.
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: TravelingPennies on September 23, 2019, 11:00:00 PM
Post by: TravelingPennies on September 23, 2019, 11:00:00 PM
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: Rob L on September 24, 2019, 11:00:00 PM
Post by: Rob L on September 24, 2019, 11:00:00 PM
I'm surprised by this since I think it is only a matter of time before LC shuts down individual participation completely. According to their most recent quarterly report individual investors now represent only 5% of originations (lowest % ever):
https://ir.lendingclub.com/Cache/1001255340.PDF?O=PDF&T=&Y=&D=&FID=1001255340&iid=4213397
Why they continue it at all is an interesting question. Maybe they still make a bit of money from it but it seems pretty likely it's dying and LC will eventually pull the plug. The only reason I can imagine is that if LC shut it down they'd have to write off all the assets they carry on their books for this part of their business (software, computers, leases with cloud services providers, etc.). Might be a pretty big hit on the balance sheet that could hurt their stock price but I haven't done the research to figure out how big.
https://ir.lendingclub.com/Cache/1001255340.PDF?O=PDF&T=&Y=&D=&FID=1001255340&iid=4213397
Why they continue it at all is an interesting question. Maybe they still make a bit of money from it but it seems pretty likely it's dying and LC will eventually pull the plug. The only reason I can imagine is that if LC shut it down they'd have to write off all the assets they carry on their books for this part of their business (software, computers, leases with cloud services providers, etc.). Might be a pretty big hit on the balance sheet that could hurt their stock price but I haven't done the research to figure out how big.
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: TravelingPennies on September 24, 2019, 11:00:00 PM
Post by: TravelingPennies on September 24, 2019, 11:00:00 PM
They did lay off the retail sales staff.
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: TravelingPennies on September 24, 2019, 11:00:00 PM
Post by: TravelingPennies on September 24, 2019, 11:00:00 PM
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: jrl on September 24, 2019, 11:00:00 PM
Post by: jrl on September 24, 2019, 11:00:00 PM
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: Fred93 on September 24, 2019, 11:00:00 PM
Post by: Fred93 on September 24, 2019, 11:00:00 PM
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: bkcarolina on September 25, 2019, 11:00:00 PM
Post by: bkcarolina on September 25, 2019, 11:00:00 PM
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: Rob L on September 25, 2019, 11:00:00 PM
Post by: Rob L on September 25, 2019, 11:00:00 PM
Another quick look at the Q2 presentation reports 200k+ self directed individuals that invested $155m. That's $775 per investor in Q2; or $258 per investor per month; or a little over 10 notes of $25 each per investor per month. The self directed investor business isn't exactly booming 
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: investny on October 09, 2019, 11:00:00 PM
Post by: investny on October 09, 2019, 11:00:00 PM
Anyone got/heard any updates on this situation. Or should we just all forget about LC?
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: Edward Reid on October 09, 2019, 11:00:00 PM
Post by: Edward Reid on October 09, 2019, 11:00:00 PM
If LC opens it up again, I'll invest again. I'm not planning on it though. I'm withdrawing cash as it accumulates and spending my time thinking about other stuff. Lending Club? Sounds vaguely familiar. Was that a basketball team?
Edward
Edward
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: TravelingPennies on October 09, 2019, 11:00:00 PM
Post by: TravelingPennies on October 09, 2019, 11:00:00 PM
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: Jctraugott on October 15, 2019, 11:00:00 PM
Post by: Jctraugott on October 15, 2019, 11:00:00 PM
I've been with LC since early on, endured removal of lender ability to ask borrowers questions, powered through when auto investing became the only way to get the better notes before they were gone, watched as institutional investors were given access to the cream of the crop, maintained faith through the leadership scandals, struggled through recovery from the F and G note debacle (thanks to folioFn), complied with the onerous IRS rules, and all the while increased my stake in the platform over the years.
I've reached a point of inflection with this latest event. What's different? What's different is that each of the previous struggles could be explained or justified; growing pains, market changes, underwriting lessons learned, pursuit of profitability, competition, and so forth. There no no way however to justify suspension of note creation is multiple states without an explanation to investors. Trust is broken. I thought that we (lenders) were part of the team but this event is a wake up call. We are not on the team. I'm not sure what we are to LC but I'm feeling used and taken advantage of.
Perhaps as others have said, individual lenders no longer matter to them, or perhaps what happened is so embarrassing that they don't want anyone especially their coveted institutional investors to know, or perhaps they assume we will take what they dish out and stick with them. It's all speculation. We don't really need to know though because Trust is broken. It calls into question everything they say and do. Notes have always been risky but it seemed acceptable risk with a good underwriter behind it. Now, the level of risk is increased beyond acceptable limits in the absence of transparency and trust.
I'm not yet sure what I personally will do with this segment of my portfolio, but the relationship with LC is broken.
I've reached a point of inflection with this latest event. What's different? What's different is that each of the previous struggles could be explained or justified; growing pains, market changes, underwriting lessons learned, pursuit of profitability, competition, and so forth. There no no way however to justify suspension of note creation is multiple states without an explanation to investors. Trust is broken. I thought that we (lenders) were part of the team but this event is a wake up call. We are not on the team. I'm not sure what we are to LC but I'm feeling used and taken advantage of.
Perhaps as others have said, individual lenders no longer matter to them, or perhaps what happened is so embarrassing that they don't want anyone especially their coveted institutional investors to know, or perhaps they assume we will take what they dish out and stick with them. It's all speculation. We don't really need to know though because Trust is broken. It calls into question everything they say and do. Notes have always been risky but it seemed acceptable risk with a good underwriter behind it. Now, the level of risk is increased beyond acceptable limits in the absence of transparency and trust.
I'm not yet sure what I personally will do with this segment of my portfolio, but the relationship with LC is broken.
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: kib on October 22, 2019, 11:00:00 PM
Post by: kib on October 22, 2019, 11:00:00 PM
@jctraugott, I absolutely agree with this. I haven't been in from the beginning, but I've seen many of the things you mention and yes, this one is the straw that's breaking the camel's back. I've gone from feeling like part of the team, to feeling ignored but functional, to this "talk to the hand" business. The risk of non-liquidity was always clear, but there was no stated risk that I suddenly wouldn't be able to reasonably manage my money OR get it back. This is like they locked the door to participation with all my money on the other side and they won't even acknowledge it. "You want out? Sure, just go to this secondary site and put your notes up at a 20% loss and we'll take the profit from that, thanks for the donation."
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: jrr6415sun on November 01, 2019, 11:00:00 PM
Post by: jrr6415sun on November 01, 2019, 11:00:00 PM
This happened to me in Florida years ago (I don't remember the exact year). LC turned off FL and told me they just had to get their license renewed every few years and that they were waiting on the government to sign off on it. A few months later FL was back. I have to assume this is a similar situation.
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: TravelingPennies on November 01, 2019, 11:00:00 PM
Post by: TravelingPennies on November 01, 2019, 11:00:00 PM
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: TravelingPennies on November 25, 2019, 11:00:00 PM
Post by: TravelingPennies on November 25, 2019, 11:00:00 PM
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: TravelingPennies on November 25, 2019, 11:00:00 PM
Post by: TravelingPennies on November 25, 2019, 11:00:00 PM
I'm in NY and did not get any emails from LC.
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: TravelingPennies on January 02, 2020, 11:00:00 PM
Post by: TravelingPennies on January 02, 2020, 11:00:00 PM
Almost 4 months and still no updates from LC!
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: TravelingPennies on January 02, 2020, 11:00:00 PM
Post by: TravelingPennies on January 02, 2020, 11:00:00 PM
Personally I'm not expecting any updates. As others have pointed out, LC has little incentive to work on keeping individual investors. If my state gets brought back into the fold, I'll reinvest, but until/unless that happens, I'l just take my payments and run.
Edward
Edward
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: jrl on January 07, 2020, 11:00:00 PM
Post by: jrl on January 07, 2020, 11:00:00 PM
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: welkestein on January 17, 2020, 11:00:00 PM
Post by: welkestein on January 17, 2020, 11:00:00 PM
Thank you very much for the solution. It really helps.
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: LiKenun on January 27, 2020, 11:00:00 PM
Post by: LiKenun on January 27, 2020, 11:00:00 PM
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: jrr6415sun on February 01, 2020, 11:00:00 PM
Post by: jrr6415sun on February 01, 2020, 11:00:00 PM
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: TravelingPennies on March 04, 2020, 11:00:00 PM
Post by: TravelingPennies on March 04, 2020, 11:00:00 PM
anyone heard an update to this? I still can't invest
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: Edward Reid on March 04, 2020, 11:00:00 PM
Post by: Edward Reid on March 04, 2020, 11:00:00 PM
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: Fred93 on March 04, 2020, 11:00:00 PM
Post by: Fred93 on March 04, 2020, 11:00:00 PM
Given the rate at which LC is reducing allocation to the retail market, I can't imagine that they would allocate $ toward lawyers to get one state back online for retail investors.
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: TravelingPennies on March 05, 2020, 11:00:00 PM
Post by: TravelingPennies on March 05, 2020, 11:00:00 PM
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: TravelingPennies on March 31, 2020, 11:00:00 PM
Post by: TravelingPennies on March 31, 2020, 11:00:00 PM
well now i'm glad lending club blocked my state. Prevented me from reinvesting $20k in what would be really risky assets right now.
Title: Email - "An Update on Note Availability in Your State" (Now unavailable in NY+)
Post by: TravelingPennies on April 03, 2020, 11:00:00 PM
Post by: TravelingPennies on April 03, 2020, 11:00:00 PM
Seems like they unblocked 2 states. The blocked states are now: AK, FL, NC, NM, NY, PA, and OH (both primary and secondary market). NY is still on that list unfortunately, but it shows that some progress is being made.