Author Topic: "Credit for Ineligible Loan"  (Read 20552 times)

core

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Re: "Credit for Ineligible Loan"
« Reply #15 on: November 06, 2014, 11:52:01 AM »
Sounds like "no harm no foul", if what I have been told is correct.

Many of the notes would have been worth slightly more after the first payment and FICO change.  You guys got gypped.  It is not no harm no foul.  And who is there to verify that they took all the loans that they were supposed to, not just the good ones?  Nobody.  Y'all just have to take their word for it.  It all sounds damn suspicious to me.

avid investor

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Re: "Credit for Ineligible Loan"
« Reply #16 on: November 06, 2014, 12:00:21 PM »
Just trying to honor the LC 13th Amendment, core.   ;)

kbenson99

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Re: "Credit for Ineligible Loan"
« Reply #17 on: November 06, 2014, 12:02:41 PM »
An example note refunded to me is https://www.lendingclub.com/account/loanPerf.action?loan_id=22101306&order_id=36226607&note_id=57454347.  If you attempt to access the performance page or detail page, you will receive a "Sorry, you do not have access to this loan" or an "Invalid Note or Order specified" exception.  Given the exception, it is logical that these are loans (policy code, institutional, etc) that were not supposed to be released to retail investors.

I noticed the exception on Nov 2 and sent LC an email looking for an explanation.  The reply I received was that it was forwarded on to the "appropriate team for further review as it may be related to a system bug".  Haven't received a follow-up on the refund yet.

BruiserB

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"Credit for Ineligible Loan"
« Reply #18 on: November 06, 2014, 12:34:29 PM »
I have around 20 of these.


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Randawl

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Re: "Credit for Ineligible Loan"
« Reply #19 on: November 06, 2014, 12:49:59 PM »
I have a bunch of these as well.  These are technically "refunds" related to some error on LC's part, but they put the credited money under adjustments/credits.  Doesn't "adjustments/credits" get reported as taxable income?  Odd that they didn't include the loan or note ID.  Also odd that part of the "refund" included accrued interest, but yet the sum total of remaining principal was also put into adjustments/credits.  Will those loans get charged-off?  Or are they simply going to "disappear"? This is odd on quite a few levels to say the least.
« Last Edit: November 06, 2014, 12:51:37 PM by Randawl »

core

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Re: "Credit for Ineligible Loan"
« Reply #20 on: November 06, 2014, 01:00:16 PM »
Nobody has used the word incompetent yet in this thread.  I see from the counts posted that this is obviously not just a few notes here and there.  This is the Bozo the Clown Show.

What is troubling though is that LC apparently reserves the right to buy back notes at any time, for whatever reason they want to make up.  Right now it's not really an issue since rates cannot go lower, but it won't always be this way.  Also even if we give them the benefit of the doubt and say that this time they only bought back notes that were involved with this fiasco; what about next time?  When they can selectively start plucking notes out of accounts there is lots of room for shenanigans there.

kbenson99

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Re: "Credit for Ineligible Loan"
« Reply #21 on: November 06, 2014, 01:30:26 PM »
Email response I received about the loans I questioned on 11/2 is as follows:

"Due to a system error, some loans that were not eligible for investment by retail investors were made available through the Lending Club platform.   ........were ineligible loans affected by this system error.  We have resolved the issue, removed all Notes corresponding to ineligible loans from investors' account and credited investors in the amount of any outstanding principal and accrued interest for such Notes."

So, sounds like policy 2 loans, institutional, etc....

rawraw

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Re: "Credit for Ineligible Loan"
« Reply #22 on: November 06, 2014, 01:57:28 PM »
Based on this forum's love of high interest rates, I'd have to gather it was subprime notes.

Randawl

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Re: "Credit for Ineligible Loan"
« Reply #23 on: November 06, 2014, 03:15:32 PM »
Based on this forum's love of high interest rates, I'd have to gather it was subprime notes.

I'd say you are right that they are the policy code 2 loans.  I've almost been refunded 1% of my entire portfolio, and they're still coming.

Edit:  I haven't made any new transfers that would skew the results.  My average age is ~16 months.
« Last Edit: November 06, 2014, 03:20:58 PM by Randawl »

muflafler

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Re: "Credit for Ineligible Loan"
« Reply #24 on: November 06, 2014, 03:18:47 PM »
I had 8 "Credit for Ineligible Loan" when I posed this morning, but now I am up to 22 in total.  It's about 2.2% of my total Notes that have been returned/refunded.

parker

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Re: "Credit for Ineligible Loan"
« Reply #25 on: November 06, 2014, 03:56:39 PM »
I had 10 loans credited for ineligibility so far today out of ~650.

I was able to find one loan that was credited. It was subGrade A3. Interestingly almost all of the fields in the loan detail were blank. It was a NoteType = 1.

Parker

GS

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Re: "Credit for Ineligible Loan"
« Reply #26 on: November 06, 2014, 04:12:59 PM »
It's hard to believe that an A3 would be subprime ...

Kombinator

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Re: "Credit for Ineligible Loan"
« Reply #27 on: November 06, 2014, 04:49:42 PM »
The notes that were erroneously issued and have now been refunded were not really Cat 2, just made it through due to a glitch, they did not pass any of the underwriting models, older or updated, and as resulte LC reasonably had to remove them from circulation.  It was basically a bug that they fixed, not great but not terribly alarming either.

parker

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Re: "Credit for Ineligible Loan"
« Reply #28 on: November 06, 2014, 07:02:50 PM »
email rcvd from lc

Due to a system error, some loans that were not eligible for investment by retail investors were made available through the Lending Club platform. We have resolved the issue and removed all notes corresponding from ineligible loans from investors' accounts and credited investors the amount of any outstanding principal and accrued interest for such notes.

rawraw

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Re: "Credit for Ineligible Loan"
« Reply #29 on: November 06, 2014, 07:17:36 PM »
I had 10 as well (out of 1000 notes)