Author Topic: How long are loans "In Funding"  (Read 10835 times)

fetish

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How long are loans "In Funding"
« on: June 30, 2014, 10:01:39 AM »
Hello all,
I just joined LendingClub earlier this month and have put about $25k into it. Right now I have 750 notes [a few big ones, some cash not invested yet, etc] but one thing that concerns me is the number of loans still "In Funding" - presently 623 of those notes are in funding and not earning payments, I don't think. I tend to only invest in loans that are >12 days left an > 65% funded already, so my feeling is that most of my loans should have funded-up relatively quickly. Of the 623 notes I have that aren't active/current/in grace period/etc, I have:

5 loans from 6/10/2014
41 loans from 6/17/2014
9 loans between 6/18 and 6/22
161 from 6/23
83 from 6/24
80 from 6/25
103 from 6/26
50 from 6/27
27 from 6/28
25 from 6/29
39 from 6/30.

My concern, obviously, is for the older loans - at what point does the loan either go live or my money refunded? Right now it seems to be in a black hole.  Anyhow, I just want to know if this is "normal" and when I should really start to worry.

Thanks!

LonghornSF

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Re: How long are loans "In Funding"
« Reply #1 on: June 30, 2014, 10:06:58 AM »
IIRC they cap the in funding period at 14 days, so you'll get your money back if the loan hasn't issued by then. On average it's more like 3-5 days though. You could probably easily calculate the figure from the data that LC provides.

fetish

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Re: How long are loans "In Funding"
« Reply #2 on: June 30, 2014, 10:34:32 AM »
IIRC they cap the in funding period at 14 days, so you'll get your money back if the loan hasn't issued by then. On average it's more like 3-5 days though. You could probably easily calculate the figure from the data that LC provides.

That response is disconcerting then - some of those loans are > 14 days and all of them older than about 10 days I can confirm are 100% funded... yet are still in a review, and I assume earning neither interest nor payments.

kbenson99

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Re: How long are loans "In Funding"
« Reply #3 on: June 30, 2014, 10:42:52 AM »
What you are seeing is normal.  After a loan has been 100% funded, it has up to 30 days from the time it was listed to be issued.  Per LC customer support, "A loan application will be removed and funds returned to investors if our underwriting team is unable to issue the loan after 30 days."

You will also see a major slowdown towards the end of the month in regards to the speed of loan issuance (noted in other posts in this forum).

lascott

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Re: How long are loans "In Funding"
« Reply #4 on: June 30, 2014, 12:11:22 PM »
IIRC they cap the in funding period at 14 days, so you'll get your money back if the loan hasn't issued by then. On average it's more like 3-5 days though. You could probably easily calculate the figure from the data that LC provides.
That response is disconcerting then - some of those loans are > 14 days and all of them older than about 10 days I can confirm are 100% funded... yet are still in a review, and I assume earning neither interest nor payments.

When first starting out it can seem painfully slow and a bit tedious.  A little annoying when you get 1/2 your fund's "not issued".

Overall after a couple months it still seems like a great new 'asset class' overall if you approach it right, pick funds with reasonable methods, and diversify.

Lending Club Loan Listings, Issuance, and Impact on Yield from Non-performing Period
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Fred93

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Re: How long are loans "In Funding"
« Reply #5 on: June 30, 2014, 03:32:11 PM »
You wait for the loan to  fund, then ...
you wait for the loan to issue, then ...
you wait for the first payment (up to 45 days after issue).

Of course often the loan doesn't issue, in which case you cycle back and try again.

It really is a slow start getting your money going.  It can be very painful when you first go thru this, and watch every day.

hoggy1

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Re: How long are loans "In Funding"
« Reply #6 on: June 30, 2014, 04:35:20 PM »
I felt the same way getting started. It gets less painful when cash left to invest gets small and payments get deposited every day.
Steve

Rob L

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Re: How long are loans "In Funding"
« Reply #7 on: June 30, 2014, 05:30:14 PM »
Maybe a bad analogy but I remember feeling the same way when I got a new job.
Work a couple of weeks, turn in the time card and get paid a couple of weeks later.
Long time between pay checks but the bills (like time and the tide) wait for no man.

BruiserB

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Re: How long are loans "In Funding"
« Reply #8 on: June 30, 2014, 08:28:58 PM »
Expecting to see a lot of notes issue in the next day or two.

This has to be an equally frustrating experience for borrowers....I wonder how many walk away or find an alternate source for the funds while they wait for Lending Club to process?

I'm hoping that at least Lending Club has been re-releasing funds to investors that are tied up in loans that won't be approved so that we can redeploy the money into other loans sooner.

rawraw

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Re: How long are loans "In Funding"
« Reply #9 on: June 30, 2014, 08:57:31 PM »
Expecting to see a lot of notes issue in the next day or two.

This has to be an equally frustrating experience for borrowers....I wonder how many walk away or find an alternate source for the funds while they wait for Lending Club to process?
Its basically borrowers dragging their feet on submitting documents and signing documents.  The borrower has a lot of control in the timing.  And the lower grade, the more they verify.

BruiserB

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How long are loans "In Funding"
« Reply #10 on: June 30, 2014, 09:56:46 PM »

Expecting to see a lot of notes issue in the next day or two.

This has to be an equally frustrating experience for borrowers....I wonder how many walk away or find an alternate source for the funds while they wait for Lending Club to process?
Its basically borrowers dragging their feet on submitting documents and signing documents.  The borrower has a lot of control in the timing.  And the lower grade, the more they verify.

No, I understand that is the reason for some of the delayed issuances......however this end of month/end of quarter delay seems due to Lending Club wanting to manage their numbers.  Many of us investors have seen almost no new loans issued in the last week to ten days.  Many of these borrowers have no doubt supplied everything Lending Club has asked for but are having to wait for the next month/next quarter to have their loans issued.


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Fred

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Re: How long are loans "In Funding"
« Reply #11 on: July 01, 2014, 12:33:41 AM »
however this end of month/end of quarter delay seems due to Lending Club wanting to manage their numbers....

Anyone has data or official statement to back this up?

Fred93

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Re: How long are loans "In Funding"
« Reply #12 on: July 01, 2014, 05:20:24 AM »


More loans do issue in the early days of a month vs other days, and said loans have suffered a longer wait time than loans issuing at other times. 

I don't ascribe any cause to this.  I don't know why it occurs.
« Last Edit: July 01, 2014, 05:22:13 AM by Fred93 »

Rob L

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Re: How long are loans "In Funding"
« Reply #13 on: July 01, 2014, 08:06:43 AM »
Nice work

BruiserB

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Re: How long are loans "In Funding"
« Reply #14 on: July 01, 2014, 10:11:57 AM »
however this end of month/end of quarter delay seems due to Lending Club wanting to manage their numbers....

Anyone has data or official statement to back this up?

Only my own data....34 loans issued last night/this morning in my account.  This compares to 2 issued yesterday, 1 on the 27th, 1 on the 26th, 1 on the 25th, 9 on the 24th, 6 on the 23rd.....

I doubt 34 people just happened to finally get their final documentation in to Lending Club yesterday.  I didn't add any new money to my account in the the last month, only reinvested my payments, so my funding of notes has been relatively even, but the issuance isn't.

I also had 59 notes issue on 6/2 which was the first business day of last month.
« Last Edit: July 01, 2014, 10:16:10 AM by BruiserB »