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Lending Club $35,000 Pre-Approved Offer

The last post in this topic was posted 2238 days ago. 

 

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Seems I get about one of these preapproval offers about once a month from both LC and Prosper. 'Best offer' rates are considerably higher than what the local CU offers.

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A family member of mine just got a LC "pre-approved up to $35,000" loan letter last week... When they went to the website and plugged in the requested information... It came back they were eligible for a $7,700 loan at a 27% interest rate... They did not take it. That's with a clean TU report and a TU score of 673.

Edited by Decafgranny

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Do you remember what amounts were offered?

 

Same as what decafgranny's family member - all the offers come in at 'up to $35,000' - let me know if you want a pic/copy. I own a few notes from LC and folks have about a snowball's chance in hell at getting in with their 'best offer' rate of 6.7%

Edited by JoeDirtPharmD

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A family member of mine just got a LC "pre-approved up to $35,000" loan letter last week... When they went to the website and plugged in the requested information... It came back they were eligible for a $7,700 loan at a 27% interest rate... They did not take it. That's with a clean TU report and a TU score of 673.

 

 

Hah.. Try Clean TU w/ 771... 6500 bucks at 21% or so...

 

Righto LC... Righto...

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I applied to try to get another soft on TU this month. With a 752 TU 08 LC offered me $5400 @ 14.99%. No thanks but better than some offers others have gotten it seems :/

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It seems if you arent loaded up with debt.. and you dont select Debt consolidation.. the rates are jacked.

Edited by nysbadmk8

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LC seems like a great alternative to the loan shark down on the street corner (especially if you're dealing with broken legs from past dealings with such a shark). Other than that, hard to imagine that any other money source (short of a finance company) wouldn't come in cheaper.

 

With near 800 FICO's (770 myFICO TU, 832 TU08), my loan option was limited to a new money 36-mo loan of $3250 at 13.98% (eff APR 17.63%). The disparity in stated vs effective rates suggests a hefty fee add-on of something like $200 up front (I haven't reviewed actual details).

 

Based upon what's been reported here and what I've observed, I'm going to guess that LC sets itself up for "adverse selection" with a consequence that investors in their notes realize a considerably subpar return vs the projected profitability of investing in the notes.

 

By setting rates at relatively non-competitive rates, applicants for LC loans likely will be those who have been shut out from other conventional sources, likely based on risk factors that aren't fully reflected in their credit score alone. This would suggest that applicants have a higher default risk than expected, and that loans to this subgroup will realize lower repayment rates, to the detriment of LC investors. (This scenario is borne out in one review at:

http://www.cbsnews.com/news/the-lending-club-a-critical-review/

Edited by hdporter

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LC seems like a great alternative to the loan shark down on the street corner (especially if you're dealing with broken legs from past dealings with such a shark). Other than that, hard to imagine that any other money source (short of a finance company) wouldn't come in cheaper.

 

With near 800 FICO's (770 myFICO TU, 832 TU08), my loan option was limited to a new money 36-mo loan of $3250 at 13.98% (eff APR 17.63%). The disparity in stated vs effective rates suggests a hefty fee add-on of something like $200 up front (I haven't reviewed actual details).

 

Based upon what's been reported here and what I've observed, I'm going to guess that LC sets itself up for "adverse selection" with a consequence that investors in their notes realize a considerably subpar return vs the projected profitability of investing in the notes.

 

By setting rates at relatively non-competitive rates, applicants for LC loans likely will be those who have been shut out from other conventional sources, likely based on risk factors that aren't fully reflected in their credit score alone. This would suggest that applicants have a higher default risk than expected, and that loans to this subgroup will realize lower repayment rates, to the detriment of LC investors. (This scenario is borne out in one review at:

http://www.cbsnews.com/news/the-lending-club-a-critical-review/

 

LC has an origination fee of 1.1 - 5.0%, depending on the risk. LC pockets the origination fee.

 

https://www.lendingclub.com/public/rates-and-fees.action

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I will hereby concede that LC is 08, BW. ;)

 

Their score today matched my 08 from Barclay's 3 days ago exactly.

 

Now that I've B* off all my INQs LC is actually willing to lend me money at less than 28.99%, lol.

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OK, I"ll change the notation,

 

but it does make LC less useful

 

if they switched from TU04 to TU08. :(

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Didn't want to thread-jack the JG Wentworth discussion,

 

so I'll put it here.

 

Those of you who haven't seen this commercial,

 

MAY get a chuckle.

 

Easily offended people SHOULD NOT click on the link:

 

https://www.youtube.com/watch?v=JzVR32tyGT8&feature=player_detailpage

 

 

Im offended, That was easy..

 

Oh wait.. I think I read those instructions wrong.

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A family member of mine just got a LC "pre-approved up to $35,000" loan letter last week... When they went to the website and plugged in the requested information... It came back they were eligible for a $7,700 loan at a 27% interest rate... They did not take it. That's with a clean TU report and a TU score of 673.

 

Are you sure? That score would put them around a C5 rating, which is 16.24% at the time I funded some loans, and LC recently lowered interest rates.

 

Pre-edit: I just checked my highest interest rate note that I funded, it is a D5 at the user is borrowing at 19.97% and their credit score was slightly higher. I'm guessing not just the score but other factors decide the grade they give the consumer. 27% would be like an F or G rating. Did you family member recently have any new delinquencies, hard inquiries, etc added?

 

EDIT: I read others posts and they are getting whacked rates as well. Odd. I have quit about of B grade notes issued from 9.67 to 11.99% and their ratings were 700.

Edited by dockworker

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My rate went from 28.99% to 14.99% by going from 6 -> 0 INQs while adding 2 new accounts and a 774 TU08.

15% for a 774 is still criminal lol.

 

Sent from my SM-G900V using Tapatalk

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My rate went from 28.99% to 14.99% by going from 6 -> 0 INQs while adding 2 new accounts and a 774 TU08.

15% for a 774 is still criminal lol.

 

Sent from my SM-G900V using Tapatalk

 

 

I about choked on my drink when they offered me 1250 at 28.99% with a 769, haha. 1250! 29%! Who are you, Credit One? :P

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My rate went from 28.99% to 14.99% by going from 6 -> 0 INQs while adding 2 new accounts and a 774 TU08.

15% for a 774 is still criminal lol.

 

Sent from my SM-G900V using Tapatalk

I about choked on my drink when they offered me 1250 at 28.99% with a 769, haha. 1250! 29%! Who are you, Credit One? :P

What in the world do you do with 1250...

 

I have a few dollars invested on the other end... I see 20k-35k and guys with 660-730 getting 12-15%. I don't understand their algorithm.

 

Sent from my SM-G900V using Tapatalk

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I would like to eventually put a few eggs in this basket down the line as well, in addition to the more secure assets I have. I, too, am confounded by their criteria. I think what's largely holding me back is I have short history (<2 yrs) with higher CL cards. I think though that once D* kicks in that will probably counteract that. We will see next month. For science!

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I'm really surprised by some of the rates in this thread. I just got a loan through them for $14k @ 11.99 w/ a 677 on TU (Asked for $20k and got it but only took what I needed). Clean report with the score being down to utilization issues, but still. Only reported $55k in income, which they never asked for verification on.

 

Seems they're all over the place?

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The last post in this topic was posted 2238 days ago. 

 

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