Author Topic: Notes stay too long in "Under Review" status  (Read 3646 times)

runnovato

  • Newbie
  • *
  • Posts: 32
    • View Profile
    • Email
Notes stay too long in "Under Review" status
« on: September 18, 2013, 11:16:37 AM »
I placed orders for my notes about a month ago and about 1/3 of those notes are still "Under Review."  Of all Under Review notes, 1/3 has been there for over two weeks. 

By looking at LC overall data, about 90% of listed notes issued in under two weeks or so.  In my math 1/3 of 1/3 is about 10%, so the numbers seem consistent.  However, the result is a little shocking.  It means that if it takes "on average" 2 weeks to issue a loan, then a month later you will still have 1/3 of your money essentially in cash.  Does it make sense?

Second question, is there a way to dump "Under Review" notes?

Thanks!

Randawl

  • Sr. Member
  • ****
  • Posts: 469
    • View Profile
Re: Notes stay too long in "Under Review" status
« Reply #1 on: September 18, 2013, 03:10:28 PM »
I think your experience is par for the course.  The time to issue may be reduced if LC can hire and train people at a faster rate than their loan volume is growing.  Even if they were fully or even overstaffed, many loans will still take a week or so because the limiting factor would be the borrower taking their time to send in requested documentation for identity/income verification.
I wonder what the loan application expiration time is in the event the borrower fails to respond or simply takes too long.  30-45 days?

As to your other question, there is no way to back out of "Under Review" notes.

runnovato

  • Newbie
  • *
  • Posts: 32
    • View Profile
    • Email
Re: Notes stay too long in "Under Review" status
« Reply #2 on: September 18, 2013, 06:56:25 PM »
The longest note Under Review was there for 56 days!

There quite a few that sit there for over 30 days.  My understanding is that is the function of how fast borrowers send their documents in.  Why not cut it off after say 30 days.  The fact that "most" loans are issued withing 2 weeks - is misleading - obviously resulting in 1/3 of your money sitting in cash a month later.  I can almost guarantee these times will shrink if there was a cut off.  This one month delay will cost almost 1% annually to some lenders. 

Common LC, get on with it! 

Rob L

  • Hero Member
  • *****
  • Posts: 2132
    • View Profile
Re: Notes stay too long in "Under Review" status
« Reply #3 on: September 18, 2013, 07:06:28 PM »
FWIW, it seems to me that this process has actually sped up over the past couple of months. Can't prove it and haven't looked at it closely enough to know for sure, but I do think loans are issuing faster now than they were. Maybe not great, but perhaps a step in the right direction.

runnovato

  • Newbie
  • *
  • Posts: 32
    • View Profile
    • Email
Re: Notes stay too long in "Under Review" status
« Reply #4 on: September 18, 2013, 07:33:19 PM »
FWIW, it seems to me that this process has actually sped up over the past couple of months. Can't prove it and haven't looked at it closely enough to know for sure, but I do think loans are issuing faster now than they were. Maybe not great, but perhaps a step in the right direction.

I am not new to LC, but just coming to realize how long it takes to get your money to collect interest.  1/3 of funds in cash 1 month later is terrible.  My aged account generate about 9% return for low grate (i.e. desirable) notes.  Take away 1% LC fee, 1% cash drag, and whatever % you want to attribute to all the labor that goes into this = 7% return is not all that impressive.  There are preferred stocks, CEFs, and other fixed income instruments that generate that much (with a lot less effort). 

I get a feeling that since many loans have stated interest rates are in 20% range, the process became highly inefficient.  At the same time LC is not doing anything different from what banks have done for decades with credit cards - so why, I ask you, their returns should be higher than your middle of the road asset backed instrument. 

runnovato

  • Newbie
  • *
  • Posts: 32
    • View Profile
    • Email
Re: Notes stay too long in "Under Review" status
« Reply #5 on: September 19, 2013, 11:56:47 AM »
Here is a thread to borrower's discussion on funding speed.  It is probably a good news, since internal inefficiencies can always be fixed. 

If supply of borrowers is limited and may be hard for LC to address in light of high demand, fixing funding speed issues would be an easy way to improve investment returns. 

http://www.lendacademy.com/forum/index.php?topic=890.0