[pplinvestor]

Borrower is over 30 days late and "Borrower requested that Lending Club cease and desist all communications" is noted in the collection log.  Did Lending Club cross the line in its collection efforts?  I saw several notes having the same log entry recently.  At the time like this, I feel like I'd better be a Borrower, instead of lenders.

[Fred93]

There is a federal law that says if borrower asks a collection agent to cease communicating, then they must do so.  You don't need justification.  You just need to put the right words in writing.  Professional deadbeats (and an occasional honest borrower) know about the law, and push this button.  Does not necessarily imply anything about the collection agent's actions.

[kya]

from: pplinvestor on June 10, 2015, 10:43:26 PM

[kbenson99]

Yep, it's the Fair Debt (deadbeat) Collection Practices Act at work; see http://en.wikipedia.org/wiki/Fair_Debt_Collection_Practices_Act and http://www.nolo.com/legal-encyclopedia/should-i-tell-debt-collector-stop-contacting-me.html.  Some borrowers (aka deadbeats) have a chip on their shoulder and can't be bothered to take responsibility for their debts and have the chutzpah to throw out the cease and desist request.  Once the cease and desist is made, LC can't do much except to sell the debt or sue.

Once I see this message in collections, I consider it a complete loss and move on.

[avid investor]

There are multiple flavors of this.    For example, a debtor can indicate that they don't want any calls at work.  (Face it, it is embarrassing and you could face job loss.)

Just because communication may have been halted, that doesn't mean that collection efforts cease.  There can still be judgments, etc.  Even for those debtors that are really trying to right their financial ship, it can take time.  Getting phone calls every few days just adds more stress.  I've seen these situations turn around.