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See Peter's article on a E-grade load just like this!
http://www.lendacademy.com/why-is-this-e-grade-loan-paying-just-6-interest/
As for why I think FICO is important, I have seen analysis where FICO is correlated with risk. But this isn't my reason. I do credit card refinancing loans almost exclusively. Generally you'll see a FICO bump after turning those credit cards into installment loans. Since we don't know these people in person (like a loan officer), the FICO is the best way I can use to monitor if they actually cut up those credit cards or if they seem to be increasing in risk afterwards.
I just called lending club investment services. The rep informed me that the borrower may have called to request a "one off" delayed payment and as long as it was within the grace period, it's OK.
Still don't know why they would have two lines of processing but it has resolved itself today.
"Yes, sir, officer." On a less snarky note, I think you dislike the fact that I'm right - that this is rather a gray area. What you likely don't realize is that I, too, dislike that it's a gray area. If I had my druthers, all loans (not "notes") would be available to both borrowers and lenders, regardless of state. As is, that's not the case, and there's some uncertainty around the legality of these notes trading outside of the states where they're approved. Which is why you don't like the "explicitness" of the model I suggest - since you know it is "iffy".
Seems what you're all dancing around is thus:You put a note up for sale and either it gets bought or it doesn't get bought. That IS the signal to go find some similar notes and put them up for sale. It doesn't have to be explicit.
The ability for Folio-only investors to signal to investors in approved states their willingness to purchase X note for y% markup, and then
have the approved-state investors "do your bidding", after which they'll put that particular note up on Folio for the non-approved to buy.
Personally, I think LC is on shaky legal ground allowing the sale of notes on its secondary market to users in states where the notes are
not approved (and I think anyone who systematically did such as a venture would likely be treading further onto shaky ground), but with
that said, I think that's really where what you're all talking about ultimately winds up. So, if someone's gonna do it - let's get on with it...
Am I reading this wrong or is that the model that you're all hoping appears? This thread feels a bit like being back in high school:
"Yeah, I'd, uh, like to buy an ounce of... baseball tickets. Something pretty high - I mean... up near.. the owner's box, you know?"
I would more likely trust a "guess" by someone on this board more than an "answer" by one of the Lending Club staff...Sounds like GAAP to me. Nonaccrual loans payments go to principal, not interest UNLESS no risk of loss exists because of an abundance of collateral, which these notes don't have. I don't know how they handle the accounting of loans on their end, though. But seems they placed it on nonaccrual.
