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Prosper Class Action Suit Settled for $10 Million Over 3 Years
cubbiesnextyr:
--- Quote from: xraider on July 19, 2013, 09:08:46 pm ---Interesting. I wonder if we'll be paid off on the same schedule as our loans. Will Doug Fuller lend his expertise if Prosper defaults?
--- End quote ---
I was thinking the same thing!
bamalucky:
I thought the cheerleaders said this case had no merit?
Fred93:
--- Quote from: xraider on July 19, 2013, 09:08:46 pm ---Will Doug Fuller lend his expertise if Prosper defaults?
--- End quote ---
God I hope not.
Fred93:
Prosper issued $178M in loans before the shutdown.
The settlement is $10M, and guessing lawyers take half, that's $5M to lenders.
Not immediately obvious how to consider the effect of $5M on $178M of lending. Recall that a large fraction (was it 45%?) of these loans defaulted.
We also have not been told how the money will be allocated among the borrowers. Will it be by amount loaned, or by amount invested (I loaned more than I invested because money got recycled), or by amount defaulted, or what?
If the metric turns out to be amount loaned, then multiply your amount loaned by 2.8%
because $5M / $178M = 2.8%
If you want to do an estimate at ROI effect, you'd have to consider the time during which you didn't have this money. Presuming we get money during 2013, that would be about 5 years.
2.8%/5 = 0.6%/year
My ROI for prosper loans for that time period was about 1.5%, so maybe I get over 2% in the end.
Whoopee.
Risk_Reward:
--- Quote from: Fred93 on July 20, 2013, 04:25:58 pm ---Prosper issued $178M in loans before the shutdown.
The settlement is $10M, and guessing lawyers take half, that's $5M to lenders.
Not immediately obvious how to consider the effect of $5M on $178M of lending. Recall that a large fraction (was it 45%?) of these loans defaulted.
We also have not been told how the money will be allocated among the borrowers. Will it be by amount loaned, or by amount invested (I loaned more than I invested because money got recycled), or by amount defaulted, or what?
If the metric turns out to be amount loaned, then multiply your amount loaned by 2.8%
because $5M / $178M = 2.8%
If you want to do an estimate at ROI effect, you'd have to consider the time during which you didn't have this money. Presuming we get money during 2013, that would be about 5 years.
2.8%/5 = 0.6%/year
My ROI for prosper loans for that time period was about 1.5%, so maybe I get over 2% in the end.
Whoopee.
--- End quote ---
The metric should be by loss dollars. say $50 million in uncollected charge offs. 5/50 = 10%
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