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[ks6328]

 
With exactly one week until the one-year anniversary of my first loan origination as a lender, I finally got hit with my first default.

I had three 4+ months late loans ...
Loan#   4+ months late on   Collection agency
13632      09/30/2007        New Agency Test
 9471      11/29/2007        New Agency Test
13597      11/30/2007        Penncro

I figured that the last two had probably rolled to 4+ months late too recently to be included, but it was the third one that was sold today.  (The Prosper blog says that the cutoff was 122 days as of 12/04/2007.)

Loan: Military man eliminating debt and wants to give back!! (Loan #13597)
Borrower: moneymike84
Sale date: Dec-27-2007
Sale reason: Delinquency
Principal balance before sale: $48.21
Loan value before sale: $56.01
Proceeds from sale and forfeited group rewards: $4.12 (approx. 8.55% of principal)
http://www.prosper.com/lend/listing.aspx?listingID=126456

I'm wondering if the other two weren't sold because they are part of the New Agency Test and are going to get some legal action in January (with any recovery above costs coming to me rather than Prosper as it would have if Prosper had repurchased the loans themselves at JDB prices).

That's fine with me, but Prosper should let the lenders know.  HA ... HAHA ... HAHAHAHAHA ... Oh, I crack me up!
 

[LoanChimp]

I'm wondering if the other two weren't sold because they are part of the New Agency Test and are going to get some legal action in January (with any recovery above costs coming to me rather than Prosper as it would have if Prosper had repurchased the loans themselves at JDB prices).

I had 2 loans as part of the test. One recovered, the other did not, but was not sold either...

[Fred93]

Golly, Prosper says the debt sale is completed.  How come these loans weren't sold?

Loan #4389  -- 8.9 months late
Loan #2297  -- 8.8 months late
Loan #2704  -- 7.7 months late
Loan #1984  -- 6.3 months late

[traveler505]

Golly, Prosper says the debt sale is completed.  How come these loans weren't sold?

Loan #4389  -- 8.9 months late
Loan #2297  -- 8.8 months late
Loan #2704  -- 7.7 months late
Loan #1984  -- 6.3 months late

Are they in BK? 

Assigned to the "New Agency" experiment?

[Shenandoah]

Golly, Prosper says the debt sale is completed.  How come these loans weren't sold?

Loan #4389  -- 8.9 months late
Loan #2297  -- 8.8 months late
Loan #2704  -- 7.7 months late
Loan #1984  -- 6.3 months late

The ones in the New Agency Test were not sold.  With a brief search I see at least one of the above was identified as a New Agency Test loan in that thread.

[112233]

Golly, Prosper says the debt sale is completed.  How come these loans weren't sold?

Loan #4389  -- 8.9 months late
Loan #2297  -- 8.8 months late
Loan #2704  -- 7.7 months late
Loan #1984  -- 6.3 months late

would Prosper hold off if they thought there was a chance the loans could be cured without being sold off?

[leporello]

I have 26 4+ month lates. 8 of them are BKs, but the other 18 are "In collections".

[Fred93]

Are they in BK? 

No.  I have others in BK, but these are >4 months late and NOT in BK.

Assigned to the "New Agency" experiment?

Indeed they are.  However, Prosper's note (on the Prosper blog) about the debt sale doesn't say anything about "New Agency Test". 

Prosper says "Eligible loans were more than 122 days past due as of December 4th, 2007, provided the loan was not part of any bankruptcy filing." which is apparently an incomplete or incorrect statement.

[Mtnchick]

Are they in BK?

No.  I have others in BK, but these are >4 months late and NOT in BK.

Assigned to the "New Agency" experiment?

Indeed they are.  However, Prosper's note (on the Prosper blog) about the debt sale doesn't say anything about "New Agency Test". 

Prosper says "Eligible loans were more than 122 days past due as of December 4th, 2007, provided the loan was not part of any bankruptcy filing." which is apparently an incomplete or incorrect statement.

They had to accomplish two things before PD08:

Make the December sale, as promised and not make their numbers look even worse than they already do. They managed to accomplish that by not selling all the "old" loans. How long have the "New Agency" loans been assigned? If it's more than a month, then they should have been included in the sale. If a borrower was contacted by Pencro for months, then the "New Agency" it's a pipedream to think they are suddenly going to pay up after a month of contact.

2cents

[Xenon481]

would Prosper hold off if they thought there was a chance the loans could be cured without being sold off?

Contrary to statements made by Prosper employees, it doesn't appear that way since they have sold off two loans now (one in this batch) that were actively making payments (albeit interest only).

[traveler505]

Are they in BK?

No.  I have others in BK, but these are >4 months late and NOT in BK.

Assigned to the "New Agency" experiment?

Indeed they are.  However, Prosper's note (on the Prosper blog) about the debt sale doesn't say anything about "New Agency Test". 

Prosper says "Eligible loans were more than 122 days past due as of December 4th, 2007, provided the loan was not part of any bankruptcy filing." which is apparently an incomplete or incorrect statement.

They had to accomplish two things before PD08:

Make the December sale, as promised and not make their numbers look even worse than they already do. They managed to accomplish that by not selling all the "old" loans. How long have the "New Agency" loans been assigned? If it's more than a month, then they should have been included in the sale. If a borrower was contacted by Pencro for months, then the "New Agency" it's a pipedream to think they are suddenly going to pay up after a month of contact.

2cents

The new agency is apparently a collections law firm.  Collections law firms have much bigger teeth than collection agencies.  The threat of being sued has already brought in payments from borrowers who were ignoring Penncro, and the filing of lawsuits in January (assuming it happens) will likely bring more.  Once a judgment is obtained,a collection law firm, unlike a collection agency, can take the borrower's money (by wage garnishment, bank account levy, etc.) rather than merely attempting to persuade the borrower to turn it over.

[Fred93]

The new agency is apparently a collections law firm.  Collections law firms have much bigger teeth than collection agencies. 

Yep.  Doug Fuller in his famous interview, said he was gonna have Prosper buy loans and then have the law firm work on 'em.  We complained that if he did that we lenders wouldn't get the benefit of the improved collections effort.  Doug was then silent.  We don't know if he's going ahead with that plan, or changed the plan, or what.  Do we?  Somewhere I have the email from Prosper belatedly announcing the "new agency test".  I haven't read it lately so don't remember exactly what it said.

Perhaps he's now on a modified plan where they leave the loans owned by the lenders while they do the lawyer thing.  Would be nice if they told lenders what they were doing.  I coulda missed something, but seems like Prosper employees missed it too... The announcement of the sale by Prosper, for example, says all loans that were 122 days late on 12/4 and not in BK... and doesn't mention the lawyer category at all. 

[traveler505]

IIRC, someone reposted a statement from Prosper on the .com forums saying that the "New Agency" was in fact a law firm, and that lawsuits woould be filed in January.  (Or perhaps I just imagined that.)  I rarely read the .com forums anymore; I figure that, in the unlikely event that something meaningful is said there, it will be reported here in the real Prosper forums.

[ks6328]

Assigned to the "New Agency" experiment?

Indeed they are.  However, Prosper's note (on the Prosper blog) about the debt sale doesn't say anything about "New Agency Test". 

Prosper says "Eligible loans were more than 122 days past due as of December 4th, 2007, provided the loan was not part of any bankruptcy filing." which is apparently an incomplete or incorrect statement.

And you are surprised at this?   
 

[lenderguy]

Make the December sale, as promised and not make their numbers look even worse than they already do. They managed to accomplish that by not selling all the "old" loans. How long have the "New Agency" loans been assigned? If it's more than a month, then they should have been included in the sale. If a borrower was contacted by Pencro for months, then the "New Agency" it's a pipedream to think they are suddenly going to pay up after a month of contact.

As was stated above about the "New Agency" being a law firm, there is something everybody should know:

IIRC, these borrowers are all California residents, which means there is no question that California law (and therefore California courts) have proper jurisdiction.  I know for a fact that lawsuits in California cannot be filed overnight.  First, you must make a formal demand for payment, second, you must serve the papers and wait for a trial date.  (I do not know if a borrower can receive a default judgement if he fails to file a formal answer.  The formal answer is a procedural thing in a special type of limited civil action, which is the type of action that will apply in most cases.)