P2P Lending / NFT Lending Forum

Still waiting to hear back for a response from my end.

Agreed, would be helpful knowing how you contacted LC to get a list of which loans were fraudulent for my accounts.

Can you provide any more detail such as screenshots or your contact with LC so it can be verified by people on the forum? It doesn't make sense that you should have to invest more for it to balance unless the dollars are very small.

This is an area I have spent an extensive amount of time in looking at behavior of repeat / pre-paid borrowers.

I agree with SeanMCA with the 20% figure. Renaud previously stated that 14% of borrowers were repeat borrowers and that was nearly two years ago. He didn't specify how many had simultaneous loans outstanding or were used to pay off another loans - and yes, LendingClub absolutely DOES have this data, unless they are somehow not collecting Social Security Numbers for every borrower - which they are.

We also know that in month 8th, LendingClub begins soliciting refinances of the existing borrowers and is actively promoting it.

Conservatively there are at least 20k borrowers with matching credit profiles, closer to 30k at this point that are either repeat borrowers / pre-pay / or have simultaneous loans outstanding.

Source: https://www.bloomberg.com/news/features/2016-08-18/how-lending-club-s-biggest-fanboy-uncovered-shady-loans" class="bbc_link" target="_blank">https://www.bloomberg.com/news/features/2016-08-18/how-lending-club-s-biggest-fanboy-uncovered-shady-loans

Good read on prepayments and fraud from WSJ.

http://www.wsj.com/articles/borrower-or-fraudster-online-lenders-scramble-to-tell-the-difference-1477580637" class="bbc_link" target="_blank">http://www.wsj.com/articles/borrower-or-fraudster-online-lenders-scramble-to-tell-the-difference-1477580637

Pro Tip: If you don't have a paid subscription, Google the headline and click through from Google and it will unlock the paywall.

Two other things I've seen:

1) Person applies for a loan, they realize they can optimize their rate by obtaining a loan with a different purpose, lower amount etc. and applies for a more optimized loan.

2) Spouse 1 applies for a loan, realizes there are more efficient ways to borrow be it credit score, or the reasons listed above and applies for a loan under Spouse 2.

LendingClub is definitely cannibalizing their own business by trying to refinance borrowers very early on causing many widespread pre-payments, but that is a separate issue and likely wouldn't be related to a prepayment on the 1st payment.

Can't you just join the Payment History file with LoanStats to get the time series for FICO scores?

Doesn't necessarily catch most recent FICO change except at the monthly posting, but should help build the FICO trend.

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Formerly a "Certified FICO Professional", whatever that means.

I agree with with nonattender that the movement of credit card debt into installment loans is a risk for FICO models.

Traditionally it was assumed that installment loans were more safe or beneficial for scoring, and generally accompanied some type of asset, be it a car, home or degree.

If borrower behavior remains the same and the credit card debt is simply transferred from revolving to installment resulting in a significant FICO increase, then the risk is mis-priced and those borrowers will appear more "safe" than they actually are as a result of refinancing their credit card debt with an installment loan.

There is definitely a high correlation that if two loans are outstanding and one goes bad, the other is very likely to go bad as well.

Also agree, that investors should have the information disclosed as it materially impacts someone's decision on which loan to invest in and the risk level.

@SeattleSun - were you able to get access then to Folio as an LLC structure?

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@Anil can probably speak to this. I believe he has a decent understanding of Prosper's BRV structure.

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Anil, did you get them in a data release and now they're gone? Any idea on time frame when they may have been released?

Most of mine are more seasoned so not much luck there.

Maybe some of their new test loans?