Author Topic: Do you see more late notes during the holidays  (Read 7259 times)

Mullery

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Do you see more late notes during the holidays
« on: December 17, 2012, 07:39:32 PM »
Hello fellow LC investors.  This is my first holiday season as a LC investor and I am noticing a larger number of notes entering the grace period and falling to a late status this month.  I have only been investing for about 4 months, so I could be entering the "rocky" 5-9 month period of the bulk of my 400+ notes.

I was wondering if any LC veterans can share their experience from past holidays seasons.  I would expect with the financial stress many people experience during the holidays that we might see a higher # of grace period and late notes.  I have sold a few riskier notes on FolioFN in the past, but I am riding most of these out and hoping they return to current after the holidays.

Thanks and Happy Holidays!

Matt

veggivet

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Re: Do you see more late notes during the holidays
« Reply #1 on: December 17, 2012, 07:50:02 PM »
Funny you should mention this today. I check my accounts daily and had 5 notes go into grace period today. I've never had that many in one day. Two of the notes have already paid back more than $25, so they will probably go back to current. I don't recall if this happened last year around this time, but it would make sense to me that cash flow might be tighter for many at this time of the year.

brycemason

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Re: Do you see more late notes during the holidays
« Reply #2 on: December 17, 2012, 08:48:12 PM »
I had a rash of late notes in early December. 1.5% of my portfolio (10 notes out of 820 or so). Some have already come current, and many others have a good chance of healing.

william

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Re: Do you see more late notes during the holidays
« Reply #3 on: December 17, 2012, 09:41:07 PM »
I usually experience this but not during the holiday season right after (January). Probably because that's when the credit cards bills start coming in after a huge holiday shopping spree.

DanB

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Re: Do you see more late notes during the holidays
« Reply #4 on: December 17, 2012, 11:07:57 PM »
Hold on! I thought that most investors here were pretty much convinced that these borrowers were using our money to pay down & subsequently shred their credit cards & arrest their misguided spending habits?? If that is even remotely true then the time of the year should have little to do with their ability to pay their debt to us, should it not?  :)

Mullery

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Re: Do you see more late notes during the holidays
« Reply #5 on: December 17, 2012, 11:34:11 PM »
DanB, I know you're probably joking, but I'm sure a lot of borrowers do exactly what you are describing.  Shred those credit cards and become more responsible with their spending habits.  I'd wager that a large number of the ones who don't change end up with the notes we are talking about.  Many of them find a way to bring them back to current, but some don't.

yojoakak

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Re: Do you see more late notes during the holidays
« Reply #6 on: December 18, 2012, 06:10:18 AM »
I feel like I've had a lot of bankruptcies lately. It is a little worrying. Or maybe I've just been noticing them more.

TcH

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Re: Do you see more late notes during the holidays
« Reply #7 on: December 18, 2012, 06:47:10 AM »
I am in the same bucket.  I had 6 loans (out of 400+) go into grace period this week.  Normally I have 3 a month max and to have 6 in one week is a little disturbing. 

I also have seen it harder to sell notes on Folio during the last 30 days.  I normally dump these notes with multiple grace period payouts. 

All of it seems strange.

DanB

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Re: Do you see more late notes during the holidays
« Reply #8 on: December 18, 2012, 06:25:48 PM »
Mullery.........The vast majority of borrowers pay without any problems or fanfare, but having said that, I'd wager that a large percentage of investors here don't really understand the behavior of that smaller group that pay but only with consistent drama, delays etc etc..................or sometimes, don't pay period.

Investors may understand on a theoretical level, but it's not the same as actually experiencing it. If they had experienced it, they'd be much more leery at everything that borrowers say they will or won't do & have much less "faith" that late borrowers will catch up & that someone being late once will straighten things out.  I used to be one of those borrowers, so been there, said & done all that.

DanB

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Re: Do you see more late notes during the holidays
« Reply #9 on: December 18, 2012, 07:20:39 PM »
Here's one I like, Homeowner from Colorado with $80K+ income who took out a $15k loan:

This purpose of this loan is to help build my credit score.
I don't have a sad story or some desire to buy some depreciating asset. I simply need to build my credit score.

The proceeds of this loan will be held in a bank account and the monthly payments will be automatically deducted from that bank account.

The only reason I am willing to pay interest is to demonstrate reliability and increase my credit score. In our society the price for doing that is paying an interest rate. I fully understand that and am accepting of it.

He made 3 payments & then walked away.

yojoakak

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Re: Do you see more late notes during the holidays
« Reply #10 on: December 18, 2012, 07:32:09 PM »
Here's one I like, Homeowner from Colorado with $80K+ income who took out a $15k loan:

This purpose of this loan is to help build my credit score.
I don't have a sad story or some desire to buy some depreciating asset. I simply need to build my credit score.
...

That's a prosper loan, ain't it? Not that LC doesn't have its share of those kinds of borrowers as well, I'm sure.

http://www.sec.gov/Archives/edgar/data/1416265/000141626512000205/listing_20120329-1650.htm
« Last Edit: December 19, 2012, 08:48:30 PM by yojoakak »

howler99

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Re: Do you see more late notes during the holidays
« Reply #11 on: December 19, 2012, 07:03:31 PM »
I'm seeing a higher number of grace period and late notes. I consider myself fairly financially responsible, but personally if I'm going to get stretched it will be in January. If you're already in trouble in December, it will probably take a while to dig yourself out.

TcH

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Re: Do you see more late notes during the holidays
« Reply #12 on: December 19, 2012, 10:28:29 PM »
Strike 6.  I am at 10.  What the heck!  I just sold 5 notes at a 19% discount. 

yojoakak

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Re: Do you see more late notes during the holidays
« Reply #13 on: December 20, 2012, 12:11:19 AM »
Maybe people stopped paying their debts because they think the End of the World is supposed to happen on Friday. http://en.wikipedia.org/wiki/2012_phenomenon

Hopefully they're start paying again once they wake up on Saturday and find out they're still here!
« Last Edit: December 20, 2012, 12:14:01 AM by yojoakak »

william

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Re: Do you see more late notes during the holidays
« Reply #14 on: December 20, 2012, 12:25:12 AM »
The really must think its the end of the world because I've never had so many hit grace period in 1 day. Lets just hope they did not take out the money because they think they will not have to pay it back.