Author Topic: Cancelled notes: any analysis on those  (Read 6240 times)

Kombinator

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Cancelled notes: any analysis on those
« on: October 22, 2013, 05:53:25 PM »
Wanted to see if anyone has done any analysis on some parameters that cause notes that pass all the screens and get funded to be ultimately not originated by the platform. 

Seems this ratio is very steady at about 32% of total notes / dollars committed month after month, and so far I have not ben able to explain it.  It is clearly creating a cash drag, so I wonder if anyone has managed to keep a better ratio of invested to originated on a stable basis, and if so is there a criteria that affects this in a meaningful fashion?

maxdriver

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Re: Cancelled notes: any analysis on those
« Reply #1 on: October 31, 2013, 04:53:48 PM »
What are you using for loan filters? My cancellation rate is much lower.

avid investor

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Re: Cancelled notes: any analysis on those
« Reply #2 on: November 01, 2013, 10:47:37 AM »
I suspect that the cancellation rate goes up roughly with the interest rate.  Underwriting would look for more information from the borrower, the borrower doesn't bother to provide it, or when they do, it doesn't support approval of the loan, and it is cancelled.

Kombinator

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Re: Cancelled notes: any analysis on those
« Reply #3 on: November 01, 2013, 08:33:17 PM »
That actually seems to make sense, I guess as a side effect of higher rate loans, they are higher risk and lower reliability, which is causing a larger percentage of them to not bother to provide or verify documentation in the end and thus lead to high cancellation rates on the order of 32%.

rawraw

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Re: Cancelled notes: any analysis on those
« Reply #4 on: November 01, 2013, 10:13:48 PM »
In my experience, my DEFG notes have a much higher "return to lender" ratio than my ABC

AnilG

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Re: Cancelled notes: any analysis on those
« Reply #5 on: November 02, 2013, 02:30:48 AM »
For loans listed between Sept 1st and 7th 2013

Credit Grade = A
% Loans Not Issued = 28%

Credit Grade = B
% Loans Not Issued = 32%

Credit Grade = C
% Loans Not Issued = 41%

Credit Grade = D
% Loans Not Issued = 49%

Credit Grade = E
% Loans Not Issued = 56%

Credit Grade = F
% Loans Not Issued = 58%

Credit Grade = G
% Loans Not Issued = 52%
---
Anil Gupta
PeerCube Thoughts blog https://www.peercube.com/blog
PeerCube https://www.peercube.com

Lovinglifestyle

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Re: Cancelled notes: any analysis on those
« Reply #6 on: November 02, 2013, 09:51:10 AM »
Very informative--thanks!

Kombinator

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Re: Cancelled notes: any analysis on those
« Reply #7 on: November 02, 2013, 10:48:48 AM »
Great, Anil wonderful data, thank you, very helpful.

Would you be able to share just how and where you obtained the data that allowed you to run the above analysis, unlike prosper cancelled loans don't stay in the notes.csv file, so hard to be able to track them on account level.  Don't know if that is doable, but if not, how are you tracking them even on population level, is there a field that can be used?
« Last Edit: November 02, 2013, 11:24:31 AM by Kombinator »

brycemason

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Re: Cancelled notes: any analysis on those
« Reply #8 on: November 02, 2013, 06:22:29 PM »
He's saving all the browseNotes files. Good job, Anil. I've definitely experienced a larger proportion of As and Bs getting issued than my higher risk portfolio.

AnilG

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Re: Cancelled notes: any analysis on those
« Reply #9 on: November 02, 2013, 07:41:22 PM »
Longitudinal data collection with PeerCube and some transformation for finding the answer.

Great, Anil wonderful data, thank you, very helpful.

Would you be able to share just how and where you obtained the data that allowed you to run the above analysis, unlike prosper cancelled loans don't stay in the notes.csv file, so hard to be able to track them on account level.  Don't know if that is doable, but if not, how are you tracking them even on population level, is there a field that can be used?
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Anil Gupta
PeerCube Thoughts blog https://www.peercube.com/blog
PeerCube https://www.peercube.com

lascott

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Re: Cancelled notes: any analysis on those
« Reply #10 on: July 12, 2014, 11:30:08 AM »
I don't think it is my imagination but in the past few weeks I have noticed a LOT more notes going through and less being canceled. Others notice anything? ie. the info I get in these emails"
- Order complete: # Note(s) not issued
- Order complete: All Notes issued

Aside: I had a thread on this canceled notes percentage topic ( http://www.lendacademy.com/forum/index.php?topic=2296.0 ) and Anil ponited me to this older one.

For loans listed between Sept 1st and 7th 2013

Credit Grade = A
% Loans Not Issued = 28%

Credit Grade = B
% Loans Not Issued = 32%

Credit Grade = C
% Loans Not Issued = 41%

Credit Grade = D
% Loans Not Issued = 49%

Credit Grade = E
% Loans Not Issued = 56%

Credit Grade = F
% Loans Not Issued = 58%

Credit Grade = G
% Loans Not Issued = 52%

Tools I use: (main) BlueVestment: https://www.bluevestment.com/app/pricing + https://www.interestradar.com/ , (others) Lending Robot referral link: https://www.lendingrobot.com/ref/scott473/  & Peercube referral code: DFVA9Y

AnilG

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Re: Cancelled notes: any analysis on those
« Reply #11 on: July 12, 2014, 06:17:07 PM »
Table 2 in my blog post at https://www.peercube.com/blog/post/21 has better number on loans issued as percentage of loans listed.

I don't think it is my imagination but in the past few weeks I have noticed a LOT more notes going through and less being canceled. Others notice anything? ie. the info I get in these emails"
- Order complete: # Note(s) not issued
- Order complete: All Notes issued

Aside: I had a thread on this canceled notes percentage topic ( http://www.lendacademy.com/forum/index.php?topic=2296.0 ) and Anil ponited me to this older one.

---
Anil Gupta
PeerCube Thoughts blog https://www.peercube.com/blog
PeerCube https://www.peercube.com