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[onthefence]

So prosper has this tower ad out:

Which points to this advertising link:
http://www.prosper.com/prm/lender5.htm?s=ecc
With this fine print:

*All loans are made by Prosper Marketplace, Inc. and sold to winning bidders registered as lenders with Prosper. Prosper "lenders" are loan purchasers. Rates of return shown are the average annual returns on Prosper loans originated between 7/1/06 and 10/30/07 to borrowers with AA - C credit grades who requested automatic funding, have 0 - 1 current delinquencies and 0 inquiries in the last 6 months on their credit record, as of 11/30/07. For more information, go to http://www.prosper.com/lend/performance.aspx. Each lender's results will differ depending on the default rate of the lender's portfolio, and may vary over the 3-year term of the loans. Loans and returns on loans are not FDIC-insured and have no Prosper guarantee. Loans may lose value.

Emphasis mine.

Off the top, I was surprised that they were now going for automatic funding.  Now, I see that their view date is as of 11/30/07, one month after their loan selection had ended.  For a recent advertising campaign, you would think they would be using recent view dates (unless they are trying to dupe some suckers).

Using their OWN criteria, I get THIS:

AA     4.74%
A     7.33%
B     7.71%
C   11.78%

I don't see no stinking 12.81% return on any of those classes.

If we move forward in time to a view date as of 4/29/08 we get THIS.

AA     7.27%
A     5.91%
B     1.76%
C     10.52%

Come on Prosper.  There is spinning the truth & then there is not even getting your facts right.  If you guys are going to have to tango with the SEC, you need to clean this stuff up now.

[iLIE]

Said search doesn't mention the 39 loans that are late out of 406..This slice won't be used for very long after a debt sale

http://www.prosper.com/lend/performance.aspx?af=1&esba=63&gm=0&gr=0%2c1%2c2%2c3%2c4%2c5&hw=0&iba=255&ibid=0&iwatch=0&lc=0%2c1%2c2%2c3%2c4%2c5%2c6%2c7&lq=&maxAmt=25000&maxDTI=1000000&maxFund=1&maxGrpTLC=1000000&maxND=1&maxQ6=0&minA=0&minAA=0&minAmt=0&minB=0&minC=0&minD=0&minDTI=0&minE=0&minFund=0&minGrpTLC=0&minHR=0&minNC=0&minND=0&minQ6=0&occ=&od=04%2f29%2f2008&oer=10%2f30%2f2007&osr=07%2f01%2f2006&plcgd=&plp=0&sf=10&sh=0&sn=&tg=0

[pioneer11]

Prosper loans that originate on Tuesday afternoons between 1:00 and 2:45 and have a credit rating of AA to HR on a partly cloudy day with the wind from the west at 12 mph gusting to 20 mph and relative humidity between 65 and 65.01% have a return of -35 to +35%*

*Not FDIC insured.  May lose value.  No bank or Prosper guarantee.  Void where prohibited.  Your mileage may vary.  Weight loss not typical.  

[Xenon481]

Now, I see that their view date is as of 11/30/07, one month after their loan selection had ended.

So they are including loans that haven't even made a single payment.....

[Staneslav]

a

[ira01]

Does this surprise anyone here?  I posted an almost identical analysis of this very banner ad almost five months ago, with pretty much the same results -- not only are Prosper's stated conditions ridiculous, but even when you use them you get worse results from Prosper's own performance page than stated in the ads (although back then the stated results were closer to the actual results than they are now).  So even after pointing out to Prosper how bogus this ad is, Prosper is STILL running it almost five months later (and now the difference between the stated results and the actual results is even larger than it was when I first analyzed it).  I would say "just unbelievable" but, of course, it unfortunately isn't.

[Staneslav]

a

[BrassKnuckles]

Prosper loans that originate on Tuesday afternoons between 1:00 and 2:45 and have a credit rating of AA to HR on a partly cloudy day with the wind from the west at 12 mph gusting to 20 mph and relative humidity between 65 and 65.01% have a return of -35 to +35%*

*Not FDIC insured.  May lose value.  No bank or Prosper guarantee.  Void where prohibited.  Your mileage may vary.  Weight loss not typical. 

lol 

[j9359]

And these ROI guestimates don't match the expected ROI for any of the current PP slices:  4.68% - 9.45%

[112233]

if only I could choose my loans after looking at how they peformed

[iLIE]

if only I could choose my loans after looking at how they peformed

I still wouldn't pick any that weren't PIF

[xraider]

poof