Author Topic: Lot of loans but not quality loans  (Read 11182 times)

lascott

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Lot of loans but not quality loans
« on: May 25, 2015, 11:08:45 AM »
In the last week or two there were a ton of quality loans I picked up (quality that matched my BV+P2PPicks and LendingRobot criteria).

Lately there are hardly any "quality" loans but there are "plenty" of them. See graphic.  LendingClub keep get a source of loans from different places and rotate what they put in the retail investor bucket.  Anyone else find this all strange.

Current loans


My LendingRobot investments in the past few weeks just showing volume of quality loans found differences.
« Last Edit: May 25, 2015, 11:11:51 AM by lascott »
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

brycemason

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Re: Lot of loans but not quality loans
« Reply #1 on: May 25, 2015, 11:24:02 AM »
Defining quality as matching your (or my) criteria may be a bit of a misnomer, as perhaps LC has found other ways to compensate for the apparent loss in the traditional metrics upon which we filter or score. Only time will tell.

I recall one time I think in early 2013 when this sort of thing happened. Everyone was moaning their filters didn't make many matches, and then a few of us discovered that the share of loans with public records had shot up from a basal rate of maybe 5-10% to like 40% of all loans on the platform for that period. I casually joked that perhaps LC got the mailing list of Bankruptcy Anonymous, and it turned out not to be far from the truth (although LC didn't disclose what group and I'm of course making up a hyperbolic name for humor).

Marketing channels will produce applicants of differing characteristics.

mchu168

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Re: Lot of loans but not quality loans
« Reply #2 on: May 25, 2015, 11:27:13 AM »
Quality borrowers are celebrating graduations and heading out on summer vacations.  The deadbeat borrowers are hanging out applying for loans. Loan quality is driven by the applicants.

PhilGD

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Re: Lot of loans but not quality loans
« Reply #3 on: May 25, 2015, 12:53:39 PM »
Defining quality as matching your (or my) criteria may be a bit of a misnomer, as perhaps LC has found other ways to compensate for the apparent loss in the traditional metrics upon which we filter or score. Only time will tell.


What other ways could LC compensate us besides assigning each loan the appropriate interest rate? I can agree with your logic that certain filtering schemes may no longer be valid; however, for those of us who use credit algorithms to judge loan quality, our methods should be more resilient than filtering.

According to my own model, many loans posted within the past several days have been assigned expected default rates far lower than what is appropriate; hence, the corresponding interest rate is not high enough to compensate for the level of risk.
« Last Edit: May 25, 2015, 12:57:31 PM by PhilGD »

brycemason

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Re: Lot of loans but not quality loans
« Reply #4 on: May 25, 2015, 01:11:42 PM »
I mean that LC has more to judge rates than they make available to investors. Perhaps the set of information we don't see looks better.

aliengar0

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Re: Lot of loans but not quality loans
« Reply #5 on: May 26, 2015, 09:30:12 AM »
I'm in a similar situation where my filters haven't picked up more than 2 loans per day in the past week, but it's nothing worth being concerned about yet

lascott

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Re: Lot of loans but not quality loans
« Reply #6 on: May 27, 2015, 05:44:56 PM »
Things have picked back up some. Whew... about was about to buy some bonds <grin>
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

Fred

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Re: Lot of loans but not quality loans
« Reply #7 on: May 28, 2015, 02:21:30 AM »
Things have picked back up some.

My note-picking algo didn't show any slowdown this past week. ;)

Fred93

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Re: Lot of loans but not quality loans
« Reply #8 on: May 28, 2015, 05:18:49 AM »
I've done very well in the last week.

lascott

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Re: Lot of loans but not quality loans
« Reply #9 on: May 28, 2015, 10:57:14 AM »
Jerks -- :) -- maybe I'm just more conservative in my note picking -- actually I'm sure of it! (ie. my LendingRobot criteria and my additional criteria on P2P-Picks picks).
« Last Edit: May 28, 2015, 10:59:09 AM by lascott »
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: Lot of loans but not quality loans
« Reply #10 on: May 28, 2015, 02:08:26 PM »
Do you have cash in your account to invest in new notes?

At PeerCube, I frequently get messages from users for not enough quality loans, filter criteria is too tight, automated lending not working etc. Majority of times it turns out that they don't have enough cash balance in their accounts. Just couple of days ago, a user messaged me that automated lending may be broken because in May, only 44 orders were placed versus 90 orders last month in his account. Turned out that he only has $24 in available cash right now and available cash balance never went above $71 in the month of May. So his cash was being deployed as soon as it was showing up in the accounts but not enough cash to place more orders.

Jerks -- :) -- maybe I'm just more conservative in my note picking -- actually I'm sure of it! (ie. my LendingRobot criteria and my additional criteria on P2P-Picks picks).
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lascott

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Re: Lot of loans but not quality loans
« Reply #11 on: May 28, 2015, 03:23:03 PM »
Do you have cash in your account to invest in new notes?

At PeerCube, I frequently get messages from users for not enough quality loans, filter criteria is too tight, automated lending not working etc. Majority of times it turns out that they don't have enough cash balance in their accounts. Just couple of days ago, a user messaged me that automated lending may be broken because in May, only 44 orders were placed versus 90 orders last month in his account. Turned out that he only has $24 in available cash right now and available cash balance never went above $71 in the month of May. So his cash was being deployed as soon as it was showing up in the accounts but not enough cash to place more orders.

Jerks -- :) -- maybe I'm just more conservative in my note picking -- actually I'm sure of it! (ie. my LendingRobot criteria and my additional criteria on P2P-Picks picks).
Thanks for your concern and follow up.  I could understand as a tool site that could be frustrating.  I have done something similar to that before and set my cash limit >0 and hit that limit. LendingRobot does send emails daily (or weekly/monthly now if you want) and it includes your current balance so that can be informative.  I get your point thought that they (Peercube) were purchasing whatever they could when money was available.  Certainly the beauty of these automated systems and without you guys, I would never have gotten into P2P lending.

From my graphics in my initial post I was getting quite a few notes a few weeks ago. I get more than that since P2P-Picks via BV is also getting me notes. Since my criteria didn't change I had to assume it was the notes being offered that was different.
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

lascott

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Re: Lot of loans but not quality loans
« Reply #12 on: June 22, 2015, 06:06:59 PM »
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

kya

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Re: Lot of loans but not quality loans
« Reply #13 on: June 22, 2015, 07:56:35 PM »
yes purchased many today...hope i wasnt wearing "rose colored glasses" lol

thezfunk

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Re: Lot of loans but not quality loans
« Reply #14 on: June 23, 2015, 11:47:07 PM »
Quality borrowers are celebrating graduations and heading out on summer vacations.  The deadbeat borrowers are hanging out applying for loans. Loan quality is driven by the applicants.

Not to throw this off topic but your jesting is actually what I see.  On Prosper, almost all of my defaults are from notes originated in the months of June-early Sept.  There are a couple of outliers but it follows over the last few years.  I don't know how to explain it.