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I planned to blog in commiseration with Tom about being denied for a loan. Tom was denied for a Zopa loan and I was rejected for a GE Money Bank credit card through Amazon. GE Money Bank took 10 days to tell me that they could not verify my identity despite the promise on Amazon.com of a 30 second approval process. I have a 800 credit score and provided all information including a phone number and they could not verify my identity. They did not bother calling to verify and customer service told me the process is computer automated. Ten days for a computer program to return results? I doubt it…

Sorry /Rant Off
I’ll skip the remainder of my planned rant about Amazon’s relationship with GE Money Bank Read the rest of this entry »

Prosper Marketplace’s recent fee changes on P2P loans are further separating P2P lenders’ interests from those of Prosper. Prosper is loading up more fees at the front of the loan so they will be earning a far greater percentage of their income from loan origination. Lenders, on the other hand, earn all their money from loan payments being made. There has long been concern that Prosper creates and packages loans and moves on to originate the next loan while forgetting about collections. Collection (or even loan fraud) becomes someone else’s problem, but unfortunately the lenders are not allowed to attempt collection leaving them with no recourse other than complaining via the internet.

The fee changes detailed in the Prosper September newsletter: Read the rest of this entry »

Question: What is the difference between my Prosper Marketplace remaining cash and a wide-angle lens for my DSLR camera?

Answer: In a week, they will be one in the same so there will be no difference.

I had $250 in cash in my Prosper account waiting to be loaned out to borrowers, but today I initiated a transfer of my cash back into my checking account. I decided that the only thing guaranteed to be around three years from now - and thus my best overall investment - is a new camera lens. I’ll need to add a little more cash to buy a good lens, but it will be much more useful and enjoyable than watching P2P loans.

Why am I pulling the plug on my Prosper Investment by removing my remaining cash?

Several reasons: Read the rest of this entry »

I received a Prosper Marketplace update via email. There were several interesting items, but it the last item stood out:

Legal Agreement Revisions
A minor change has been made to the following legal agreements, to clarify that selling or buying a recommendation or endorsement is not allowed. Please refer to the links below to view these changes.
Borrower Registration Agreement [PDF]
Lender Registration Agreement [PDF]
Group Leader Registration Agreement [PDF]

This portion of the update seems to directly target Read the rest of this entry »

A Penny Saved answered my questions about his Prosper Marketplace loan.

My major concerns were about home ownership terms and conditions and how quickly the loan would be paid back.

The question:

It says you are a home owner. Can you give the details of your loan (rate, term etc) and your current estimated equity situation in the home? Secondly, how soon do you plan to pay back the loan considering it is only for credit building?

The answer: Read the rest of this entry »

Rate Ladder is promoting a P2P loan from the blogger “The Penny Saved.”

See the loan request.

Honestly, the interest rate of 16% is rather poor considering that the Prosper lending guidance is a negative 18% due to the C credit rating.

Normally, I won’t even consider anything with a lending Read the rest of this entry »

P2P Lending has been in the mainstream media news a great deal lately. I decided to post a roundup of many of the recent news articles on Prosper.com, Lending Club, Zopa, GlobeFunder, and Virgin Money. It is unfortunate that Lending Club entered a quiet period just as they were gaining tremendous growth in loan volume.

CNBC February 5th, 2008: From Zero to Millions: Financing Your New Business:

Online Family Lending Use a lending network designed for inter-family loans, such as CircleLending.com. Tools at that site will help you and your relative come to terms on the length of the loan and the interest rate, and calculate the monthly payment amount. For $99, CircleLending issues a legally binding promissory note and a repayment schedule. For $9 per payment, the company will set up automatic repayments using electronic funds transfer.

Peer-to-peer Lending: Several websites now make it much easier to find an investor who will back your business. Check out prosper.com, lendingclub.com and zopa.com.

Lending Club’s founder financed his first company with personal loans and high-interest credit cards. He eventually sold the business to Oracle. That experience inspired his new company. Lending Club, which launched on Facebook in May 2007 and on its own site last September, uses technology to match borrowers to lenders willing to offer unsecured loans of $500 to $25,000 with three-year, fully amortizing terms.

The author, Laura Rowley, must have used some old notes because Read the rest of this entry »

This extends my posting on the blog roundup of Lending Club quiet period postings…

HollowOak asks: “How far behind is Prosper? Or do they get kudos for having started the SEC filing months ago?”

Lazy Man and Money is calling Lending Club dead:

I have been worked for a number of start-up companies and they had one thing in common - they are extremely fragile. A high percentage of new companies fail.. I’ve talked to a few other Lending Club members… and they said they are gone and never coming back. They feel their trust has been violated. With each day that Lending Club can’t or doesn’t say anything to justify this inactivity, the more trust is lost. I might be blowing this out of proportion, but I’d rather err to the side of being conservative until I have reason to believe otherwise.

LazyMan is correct that their inability to communicate this issue over the next few months (?) is going to hurt Lending Club. It was communicated poorly, so I can understand why many people must assume the worst.

ProsperousLand wondered why he took yesterday off in his catch up post today about Lending Club halting new lenders. Mike had posted previously about Prosper filing with the SEC. RateLadder also posted information on Prosper’s SEC filing. The key line from my perspective from the Prosper filing is: Read the rest of this entry »

So far all my Prosper.com and Lending Club loans are current. I would be annoyed with loan defaults, but currently the number of borrowers who pay the loan in a month or less is starting to bother me. Why does a borrower bother to take out a loan for one month?

Here are a few instances from Lending Club of early paybacks that wasted my time and tied up my money while trying to find and fund loans:
Read the rest of this entry »

Today, I planned to post some interesting information on Prosper.com lending based upon the Webinar (”Using Prosper tools for more effective lending”) that I signed up for with Prosper a few weeks ago. Unfortunately, Read the rest of this entry »