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[bamalucky]

Prosper and any loan seller or third-party servicer servicing a borrower loan shall have the right, without your consent, at any time and from time to time and subject to the foregoing servicing standard, to change the payment date or reduce the principal amount or the rate of interest or the place and manner of making loan payments on a borrower loan, or amend or waive any other term of such borrower loan, or charge off any borrower loan that Prosper or the loan seller or third-party servicer servicing the borrower loan deems uncollectible.

[ira01]

Wow.     No room for Prosper to abuse that one.   What could possibly go wrong?   

[Urbi_et_Orbi]

Where are you seeing this?

[bamalucky]

http://www.prosper.com/account/common/agreement_view.aspx?agreement_type_id=8

[Urbi_et_Orbi]

6. Servicing and Collection of Borrower Loans.

Paragraph 3.

The referral of a delinquent borrower loan to a collection agency on the 31st day of its delinquency shall be deemed to constitute commercially reasonable servicing and collection efforts. Prosper and any loan seller or third-party servicer servicing a borrower loan shall have the right, without your consent, at any time and from time to time and subject to the foregoing servicing standard, to change the payment date or reduce the principal amount or the rate of interest or the place and manner of making loan payments on a borrower loan, or amend or waive any other term of such borrower loan, or charge off any borrower loan that Prosper or the loan seller or third-party servicer servicing the borrower loan deems uncollectible.

Just this section alone should send people running for the hills.

Thanks, Bama.

Nominate for the lobby.

[bamalucky]

Here's a nice link too

http://www.prosper.com/help/topics/lender-collection_agencies.aspx

I'm ok with a lobby move

[Beerbud1]

Second the nomination for the Lobby!

[xraider]

Nice.  Lenders, you squawk too much and it's commercially reasonable for us to write off the loan.

[ira01]

Nice.  Lenders, you squawk too much and it's commercially reasonable for us to write off the loan.

Even better -- remember that loan by the Prosper employee who was using it as Prosper's employee education assistance mechanism?  Or all the other loans by Prosper employees?  So if Prosper wants to reward them for a good blog article or something, they all skip a payment, and on the 31st day Prosper simply writes the principal balance down to $0.  Presto -- Prosper employee loan forgiveness! 

ETA:  Or here's another one -- For every borrower that goes 3 months late, Prosper calls and makes the following deal -- we'll write your principal down to $0.01 if you promise to pay that.  Then Prosper reports the loan as "paid as agreed," and counts it as a PIF loan in its stats.   No more charge-offs!   

[NewHorizon]

What's the big deal.  Prosper is just wanting to do to lenders what credit card companies have been doing to borrowers: change terms at their discretion.  It's what's best for the marketplace.   

[pioneer11]

This is amazing, even considering Prosper's history.

[bankomatic]

Prosper and any loan seller or third-party servicer servicing a borrower loan shall have the right, without your consent, at any time and from time to time and subject to the foregoing servicing standard, to change the payment date or reduce the principal amount or the rate of interest or the place and manner of making loan payments on a borrower loan, or amend or waive any other term of such borrower loan, or charge off any borrower loan that Prosper or the loan seller or third-party servicer servicing the borrower loan deems uncollectible.

They can't do that to existing loans right? Only to the one's made in the future?

[xraider]

Depends on if they want to get sued again.   

[bamalucky]

Oh,now this is just too funny

Prosper has complied in all material respects with applicable federal, state and local laws in connection with the offer and sale of the Note.

[bamalucky]

You acknowledge and agree that (i) the purchase and sale of the Notes pursuant to this Agreement is an arms-length transaction between you and Prosper

Prosper is not acting as your agent or fiduciary