Author Topic: I don't get it  (Read 3281 times)

hoggy1

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I don't get it
« on: November 21, 2014, 10:14:45 AM »
Here are two loans. Both missed payments a few days ago, both should be in grace and I should be able to offer them for sale on Folio.

But, both are listed as current with payments pending so can't be sold.

https://www.lendingclub.com/account/loanPerf.action?loan_id=14689622&order_id=21302532&note_id=45326786
https://www.lendingclub.com/account/loanPerf.action?loan_id=15540894&order_id=22591735&note_id=46373691

Does LC have any hard and fast rules?
Steve

rawraw

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Re: I don't get it
« Reply #1 on: November 21, 2014, 10:57:31 AM »
Did you contact LC?

hoggy1

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Re: I don't get it
« Reply #2 on: November 21, 2014, 12:34:44 PM »
Sent
Steve

GS

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Re: I don't get it
« Reply #3 on: November 21, 2014, 03:40:30 PM »
I see that quite often, too.  Some go IGP the next day, some sit there for a few days before going IGP, or get paid quickly and never get the status change, but do show IGP in the payment log.

I'd like to hear their response, if you don't mind sharing.


hoggy1

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Re: I don't get it
« Reply #4 on: November 21, 2014, 04:24:06 PM »
I'll post their response. One just changed to IGP.
« Last Edit: November 21, 2014, 04:53:32 PM by hoggy1 »
Steve

hoggy1

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Re: I don't get it
« Reply #5 on: November 22, 2014, 02:38:36 PM »
You can read my exchange with LC below. Both loans now show as IGP as they should.

I applaud your effort to collect borrower payments for past due amounts. But these loans both had missed payments as clearly reported in the collection log. At the moment those scheduled payments were missed the loans were by definition in Grace Period and should have become available for sale. If that is not the case, then all late loans which have not been written off and for which collection efforts are ongoing could be considered "payment pending" and not salable.

The status of a loan can't be determined by some individual agent at Lending Club. Loan status should be fixed by account activity and automatically updated as documented by Lending Club here ...
http://kb.lendingclub.com/investor/articles/Investor/What-do-the-different-Note-statuses-mean/

Before your response below was sent, one of these loans was indeed changed to IGP. The other still shows current. I am arguing this should not be possible. If it is the case that a) LC has made contact with the borrower and b) the borrower has agreed to correct the deficiency, and c)  LC has resubmitted the transfer request (wherein a payment is indeed again pending) then this should be indicated in the collection log.

Steve
----------------------------------------------------------------------------------------------------------------------------------------
From: Lending Club Investor Services [investing@lendingclub.com]
Sent: Friday, November 21, 2014 6:39 PM

Subject: RE: In Grace

Hello Stephen,

Thank you for your email.

Upon further review, both loans 14689622 and 15540894 are pending due to our efforts to extract the borrowers' payments. During that time frame when Lending Club is processing a payment that was received on the loan corresponding to the listed Note, that Note is not eligible to be sold on the Note Trading Platform. To learn more about ineligible notes that can't be sold, please click here.

We hope this information is helpful. If you have any questions, please feel free to reach out to us.

Thanks,
Rene
Steve

bobeubanks

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Re: I don't get it
« Reply #6 on: November 22, 2014, 05:08:18 PM »
Quote
our efforts to extract the borrowers' payments.

Extract. Nice. Do they use waterboarding for that?

GS

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Re: I don't get it
« Reply #7 on: November 23, 2014, 01:04:52 PM »
It sounds like some quirk in their system.  They can't change the loan status to IGP because that would free it up for sale, and it can't be sold because LC has rescheduled the hit on the borrower's bank account trying to get payment, hence it's still "pending". 

That makes sense, but it seems like they should be able to go IGP and keep the note as "pending".

I bet what has happened in the past is that some people sold the notes at a discount as soon as they went IGP, then the payment came through in a day or two ... the sellers complained, and LC didn't like explaining that the note went IGP while the delayed payment was still pending ... so LC came up with this system to avoid that problem.