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[onthefence]

The establishment of an in-house collections unit would seem to be a lobby-worthy development.

2nd

I'm not so sure, but I don't see any contra-indicators. (How's that for a weak concurrence?)

3rd.

[Mark12547]

The establishment of an in-house collections unit would seem to be a lobby-worthy development.

2nd

I'm not so sure, but I don't see any contra-indicators. (How's that for a weak concurrence?)

3rd.

Too late! I had already moved it to the Lobby just after I wrote "I'm not so sure ..." 

[mothandrust]

Prosper does suck, but in this case, the payment chargebacks are not Prosper's fault.  Federal law allows people to dispute EFTs (electronic fund transfers, which includes Prosper's ACH pulls) with their bank for 60 days, and while as I read it, the bank only needs to reverse the charge if there was an "error," because banks are liable for wrongfully failing to decide such claims, I suspect banks tend to just reverse any disputed EFT in which the customer claims an "error" without requiring proof that it was an error.  

How on earth could it be an "error" when its an automated payment on a loan the guy owes?

Prosper won't do the blender offset because their goal is to homogenize loan pool as much as possible: they don't want loans to stand out as being high quality (e.g. vetted, secured, with PII showing, collateralized) versus the others which would be seen as low quality.

If blenders' income streams could be seized to pay lenders, then lenders know they are going to recover something from him--there's a payment stream that acts as collateral and makes the blender loan more attractive than a non-blender loan.

Plus, it gets lenders to go checking out the individual borrowers and doing due diligence and looking off-site for information, and we all know where that kind of behavior will inevitably lead.

[Fred93]

Prosper won't do the blender offset because their goal is to homogenize loan pool as much as possible: they don't want loans to stand out as being high quality (e.g. vetted, secured, with PII showing, collateralized) versus the others which would be seen as low quality.

Much simpler explanation is that they're just friggin' lazy.

[TotoMMB]

Recap:

Two loans went late at roughly the same time (missed mid-Jan payment)...One about 20 months old, another 2 months old (3.0). The old loan went to Amsher for collections, the new loan went to Prosper In-House.

Update:

After about 3 days in collections, the In-House loan showed a manual payment for slightly more than the regular amount. Not only that, 2 days later there was an automatic pull attempted, for slightly less than the normal amount (add the two payments together it appears they would be the sum of two normal payments). The automatic payment failed yesterday, but the manual payment cleared and has been credited to my account. So, the account is back to <15 days late but still in collections.

And I still haven't seen one dime from Amsher. Not on this current loan or any of the prior 5 COs (not counting BK).

Reaction:

I feel Amsher probably doesn't give two shits. Anything they get they probably figure is a bonus. Prosper on the other hand has a ton more to gain from giving an honest effort to collect. I know some of you have gotten funds from loans that went to Amsher. I don't know how many have In-House loans and how those might be working.

[God-Father]

Promising, but we need a much bigger sample.

[ira01]

Promising, but we need a much bigger sample.

+1.  Absolutely no conclusion can be drawn from an example of two loans.  Prosper may have just been lucky to get a borrower who accidentally bounced a check but would have paid it in short order anyway.  We need to see statistics on how Amsher and Prosper fare on ALL the loans -- something we probably won't see.

[Tokyo Joe]

Amsher resolved a pretty good one for me (assuming the manual payoff in progress goes through).

This loan has become delinquent and the AmSher collection agency is attempting to recover unpaid balances. They have collected $7.49 after 5 days. 17% of recovered funds will be paid to the agency as the service fee for their efforts. Learn more.

http://www.prosper.com/invest/listing.aspx?listingID=103832

This borrower ($15K) had fallen a few months behind in late '08, bit after that paid monthly, and sometimes twice in a month, and had made a payment as recently as Feb 6th, so this might have been a case where the borrower was planning to make the payment anyway. (In which case, I am paying them 17% for payments that would have been made anyway...)

But perhaps the nudge from Amsher was enough to get them to make a payoff, rather than another monthly installment.

[TotoMMB]

Promising, but we need a much bigger sample.

+1.  Absolutely no conclusion can be drawn from an example of two loans.  Prosper may have just been lucky to get a borrower who accidentally bounced a check but would have paid it in short order anyway.  We need to see statistics on how Amsher and Prosper fare on ALL the loans -- something we probably won't see.

I agree. I am in no way championing Prospers collections efforts as fail-safe. In my small sample, they have produced better results than Amsher, and it could totally be a fluke.

One thought that crossed my mind: Seeing as how terrible payback is on the whole platform, could it be possible Amsher got too many loans to be effective? Maybe a couple thousand accounts wouldn't cause a blip, but if they're doing other business (which it appears they are), how much attention can they give to Prosper? And if their fee is based solely on collection amounts, as opposed to them buying the bad debt, they have 0 to lose and everything to gain, especially if someone pays without Amsher even contacting them...

*edit * to fix a couple spelling issues

[ira01]

Promising, but we need a much bigger sample.

+1.  Absolutely no conclusion can be drawn from an example of two loans.  Prosper may have just been lucky to get a borrower who accidentally bounced a check but would have paid it in short order anyway.  We need to see statistics on how Amsher and Prosper fare on ALL the loans -- something we probably won't see.

I agree. I am in no way championing Prospers collections efforts as fail-safe. In my small sample, they have produced better results than Amsher, and it could totally be a fluke.

One thought that crossed my mind: Seeing as how terrible payback is on the whole platform, could it be possible Amsher got too many loans to be effective? Maybe a couple thousand accounts wouldn't case a blip, but if they're doing other business (which it appears they are), how much attention can they give to Prosper? And it their fee is based solely on collection amounts, as opposed to them buying the bad debt, they have 0 to lose and everything to gain, especially if someone pays without Amsher even contacting them...

IIRC, Amsher is a national collection agency -- Prosper's business is probably a tiny fraction of their portfolio, so I strongly doubt they "got too many loans to be effective."  And their only fee is the 17% they keep from collected amounts, so like any collection agency, their incentive is to pick off the low-hanging fruit (the debts that the borrowers pay with little effort from Amsher) and mostly ignore the rest.