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[ducks]

It's those Yankees who don't pay their debts. Pennsylvania, New Hampshire, Vermont are all in the top 10!

More seriously, I don't think there is much of a pattern. I think lenders are better served by concentrating on other factors than location, excluding Texas where unsecured loans are virtually worthless.

[traveler505]

It's those Yankees who don't pay their debts. Pennsylvania, New Hampshire, Vermont are all in the top 10!

More seriously, I don't think there is much of a pattern. I think lenders are better served by concentrating on other factors than location, excluding Texas where unsecured loans are virtually worthless.

The primary pattern, I suspect, is that higher-risk borrowers are more likely to be funded in states with higher rate caps, and that defaults follow risk.  There are exceptions, like PA, where a backlash against the rate caps resulted in social lenders funding HRs at 5% who they wouldn't have touched at 29%, and a small total number of loans allows a few oddities to skew the result.

To get a truer indication of how (if) geography affects defaults, one would have to eliminate credit grade as a factor.

[ducks]

You'd probably have to eliminate other factors as well, such as DTI, loan amount, loan amount as a proportion of income, employment status, and so on.

[Shenandoah]

California and Colorado?

All of the "New Agency Test" lates are from California . . . .

And my very first default ever was from Colorado.

[cubbiesnextyr]

As I wrote in my comment on idf's blog http://p2plendingwithprosper.blogspot.com/2008/01/are-delinquencies-more-likely-for.html

Something to keep in mind is Prosper's history when looking at stats like lates by states.

How long has Prosper been lending in that state? GA was one of the first states that Prosper was allowed to lend in at the max rates, back in the wild west days when all lenders had was a credit grade, DTI, and a story. Prosper was talked about on the radio by Clark Howard, and thus many low rated people from GA flocked to Prosper.

IL didn't allow lending at any meaningful rate (cap was 9% for a while I believe) until later in Prosper's history, after more credit data came viewable and lenders started to learn what to look out for. So their default numbers should be lower.

Some states have rate caps so restrictive, that only AA's can get loans (the northeast tends to have a lot of restrictions like this, "to protect their residents"). This also skews the numbers.

You must always remember Prosper's past when making charts and jumping to conclusions. Perhaps looking at their late rates over time would be a better idea. Is GA's rate of lates in the past 12 months better or worse than Prosper as a whole? Or IL's. Over 6 months?

[Risk_Reward]

Before I read further. Minnesota and Maine.