Rejected Loans on LendingClub – The Post-IPO Edition -- May 04, 2015
http://www.orchardplatform.com/blog/rejected-loans-on-lendingclub-the-post-ipo-edition/Great to see their analysis.
LendingClub rejects anyone with a FICO score below 660.
Why do people with such low scores even bother applying?
And more importantly, why muddy up these charts with those applications?
The analysis described in orchard blogs is never deep. Its just "Look... we like... know stuff."
More interesting would have been to look at all the other available variables, to see if criteria vs them had changed.
While I really like what Orchard is doing business model wise, their analysis and reporting leaves a lot to be desired. The data and charts shared in this article doesn't show anything related to their claims. They should consider hiring better people to do data analysis and publish findings. This article most probably was just a quick "marketing" response to institutional concerns about borrower quality post IPO.
So others have reviewed declined applications? Where is that data even located?
Indeed that graph is hard to see details on but I think they just wanted you to see the pattern of it being the same. Look left, look right. Overlays would have been better to see the data relative to each group.
Regarding less than 660 FICOs there was just news today about a middle man company having an exchange of this data. Declined by LC then LC can provide this data to the middle man and the loan can go to another company. I assumed LC gets something for doing that. That is perhaps someone thought they had a good enough FICO (or didn't even know their FICO or follow it regularly) and applied. Perhaps they are at 650 or 640 or whatever. Food for thought.
I am left with similar feelings from reading certain posts of theirs over the years. It's all a bit amateurish and as touched on is a bit of a marketing front.