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Messages - yojoakak

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721
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/

That explains it!

(Of course, there's no mention of this anywhere on LendingClub's website, except buried down in a few of the prospectuses.)

723
Investors - LC / Re: Loss Mitigation Strategies
« on: November 22, 2012, 09:55:44 AM »
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've heard that FICO scores can actually go down when someone pays off their credit card and/or closes the account. Is that true? If so, then a declining FICO score after a debt consolidation would not be surprising.

724
Investors - LC / Recent spate of bankruptacies?
« on: November 21, 2012, 01:47:16 PM »
It seems like a lot of my loans recently went into bankruptcy.

Is anyone else seeing the same thing? Or is it just a a bit of bad luck on my part?

725
Investors - LC / Nonaccrual loan, what is the purpose?
« on: November 20, 2012, 12:31:52 PM »
It appears that once a loan goes into Default, if a payment is made it all goes towards principal. The interest has been cancelled.

So could someone take out a LendingClub loan, wait for it to default, pay off the principal, never having paid a cent in interest, and be done with it? Sounds a little hinky to me.

Maybe it makes sense for banks, where loans are considered assets, but what purpose does this have in a LendingClub context?


"A loan that has reached its 120 day of delinquency is classified as a nonaccrual loan; we stop accruing interest and reverse all accrued unpaid interest. Once a loan is deemed uncollectible, 100% of the outstanding balance is charged-off, no later than the 150 day of delinquency. Any payment received on a nonaccrual loan is first applied to the unpaid principal amount of the loan and then to any interest due."

https://www.lendingclub.com/fileDownload.action?file=10-Q-JUN-30-2012.pdf&type=sf10q

See also:
http://www.investopedia.com/terms/n/nonaccrual-loan.asp#axzz2CmiwMnVS
http://www.wib.org/publications__resources/cfo__finance_digest/feb12/moularas.html

726
Investors - LC / Re: Default on first payment
« on: November 19, 2012, 07:01:27 PM »
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.   ::)

If so, then why isn't anything noted in the Collection Log? I mean, someone must have contacted someone to arrange that, right?

Take a screen shot though. It would not surprise me if one day a payment shows up and magically gets back-dated so that it looks like nothing weird ever happened.

727
Still don't know why they would have two lines of processing but it has resolved itself today.

Like I said in another thread, I've seen so many unexplained anomalies, my suspicion is there is a team of people working full-time at Lending Club whose job it is to do nothing but go around and try to fix up the Payment Histories.

728
Investors - LC / Re: FOLIOfn Selling Strategy... Flawed?
« on: November 19, 2012, 01:28:59 PM »
"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".


Every State has its own laws. LendingClub says it is doing everything within those laws.

Do you have reason to believe LendingClub is conducting business contrary to any law?

http://www.seclaw.com/bluesky.htm

http://blog.lendingclub.com/2011/06/10/is-lending-club-available-in-my-state/

https://www.lendingclub.com/foliofn/faq.action#ga3

https://www.lendingclub.com/info/prospectus.action

729
Investors - LC / Re: Default on first payment
« on: November 19, 2012, 01:11:59 PM »
In  my experience the Payment History and the Collection Log fall somewhere between a ledger and a Ouija board.

Things don't always match (between a note and you account activity, sometimes even between 2 notes for the same loan), things get changed retroactively without notification, duplicated rows come and go, dates that are in the future, rows that are missing, etc. etc. etc.

I've seen so many unexplained anomalies, my suspicion is there is a team of people working full-time at Lending Club whose job it is to do nothing but go around and try to fix up the Payment Histories.

730
Investors - LC / Re: FOLIOfn Selling Strategy... Flawed?
« on: November 19, 2012, 04:57:06 AM »
Seems what you're all dancing around is thus:

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.
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.

It would be nice if Foliofn published some of the details of transactions, like a ticker. As it is one only has one's own sale history to try and eke out that information.

Quote
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...

That is beyond the scope of the current discussion.

Quote
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?"

That is also beyond the scope of the current discussion.

731
Investors - LC / Re: Default on first payment
« on: November 19, 2012, 04:29:55 AM »
I mean the Loan Performance page, the one where you can see the Payment History and Collection Log.

Also, what do you mean by "default"? (that word has a specific meaning on LendingClub)

732
Investors - LC / Re: Default on first payment
« on: November 18, 2012, 07:59:47 PM »
Can you post a link to the Loan Performance page please?

733
Investors - LC / Re: Tool to find the default rate on a single note?
« on: November 18, 2012, 06:25:35 PM »
I haven't used it but doesn't Lendstats have something like that?

http://www.lendstats.com/loansearch/lc/lcloanfilter.php?sdm=01&sdy=2011&edm=08&edy=2012&sho1=2&ex1=1

734
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.

I did a search on "Nonaccrual loans". That could be EXACTLY what was happening.

But the only mention of this I can find on Lending Club's website are buried in some of its SEC filings:

"A loan that has reached its 120 day of delinquency is classified as a nonaccrual loan; we stop accruing interest and reverse all accrued unpaid interest. Once a loan is deemed uncollectible, 100% of the outstanding balance is charged-off, no later than the 150 day of delinquency. Any payment received on a nonaccrual loan is first applied to the unpaid principal amount of the loan and then to any interest due."

https://www.lendingclub.com/fileDownload.action?file=10-Q-JUN-30-2012.pdf&type=sf10q

(Of course, since a payment had just been made the month before, on 4/17/11, I'm not sure why that loan would be classified as "Default" but it must have been.)

I REPEAT: I would more likely trust a "guess" by someone on this board  than an "answer" by one of the Lending Club staff.

THANKS!

735
Investors - LC / Re: Tool to find the default rate on a single note?
« on: November 18, 2012, 12:21:04 PM »
"default rate on a single note"

What do you mean by "default rate"?


http://www.investopedia.com/terms/d/defaultrate.asp

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