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[Mtnchick]

ROFL. Complaints about Penncro's effectiveness?  No way.

Too little, too late.

I haven't received that email yet, BTW. Must be with my VIP invite to breakfast at PD

[ks6328]

Note that though Prosper's email security FAQ http://www.prosper.com/security/email.aspx says

Why does Prosper include my name and screen name in email?

Since people who send spoof email often don't have your first and last name as well as your Prosper screen name, receiving an email that contains this information should increase your confidence that the email was sent by Prosper.

There may still be cases where spoof emails could contain your first and last name as well as your Prosper screen name, so seeing this information isn't a foolproof indicator that Prosper sent an email. However, if this information in not included, you should be extra cautious about responding to the message in the email.

the email I received does not contain my screen name.

Prosper made such a big deal about the .org security, yet they can't follow their own security rules in their own emails.  Not for the first time.  The "Prospers.org in member descriptions" warning emails also did not contain screen names.

<sarcasm>Way to go, Prosper.</sarcasm>
 

[Mtnchick]

ROFL. Complaints about Penncro's effectiveness?  No way.

Apparently Doug has decided it's the collection agency's fault. It will be interesting to see if he's right.

I STILL think they should hire one ruthless collections guy/gal for inhouse a few months THEN send to the collection agency. But whadda I know.

[ira01]

I didn't get the email either, nor did my wife.  However, my mother-in-law did.  It's amazing that an internet company can't seem to manage to properly accomplish simple tasks like sending out emails. 

While I am in favor of this change, once again I am dismayed by Prosper's blatent breach of its legal agreements.  Prosper's Lender Agreement states, in paragraph 6(c):

When a payment becomes thirty (30) days past due, Prosper will assign the loan account to the collection agency you selected at the time of registration. If there are multiple Lenders on a loan to a borrower, and one or more of the other Lenders selects a collection agency different from the one you selected, you agree that Prosper will use the selected collection agency common to the Lender or Lenders who have the greatest ownership interest in the loan. In the event of a tie among the Lenders as to their choice of a collection agency, the agency will be selected at random by Prosper. The borrower's identity, contact information and other personally identifiable information will be provided to the collection agency to which the delinquent Note is assigned for collection, but you will not be provided with any such borrower information.

Nothing in the Lending Agreement authorizes Prosper to unilaterally decide to change collection agencies mid-stream.  And while Prosper is apparently giving a half-assed opt-out opportunity for lenders who don't want to change, nothing gives them the right to put the burden of requiring compliance with the Lending Agreement on lenders.  Moreover, what about the lenders who never get Prosper's email (like my wife and I)?  Or those who don't see it within the one week time period provided by Prosper to respond?  Will Prosper never learn that its legal agreements are BINDING on Prosper?  It certainly expects borrowers to abide by their agreements (not that more than about 80% do) -- a little reciprocity would be nice.

[patio11]

I wouldn't get too vexed about a Prosper about-face on the legal agreements when the change doesn't adversely affect our interests.  The legal agreement isn't a magical spell that we invoke because it is magic, it is rather just an agreement which is designed to protect Prosper and ourselves.  To the extent that Prosper's actions are not destructive to those ends, hang the text.

Speaking of which, I think we are seeing one of the first major policies of Doug Fuller here.  "Either improve collections or we will find someone that will."  Frankly, I'm not imagining that too many of you folks with lates are that vexed over a chance to better the collection performance.

[ira01]

I wouldn't get too vexed about a Prosper about-face on the legal agreements when the change doesn't adversely affect our interests.  The legal agreement isn't a magical spell that we invoke because it is magic, it is rather just an agreement which is designed to protect Prosper and ourselves.  To the extent that Prosper's actions are not destructive to those ends, hang the text.

Speaking of which, I think we are seeing one of the first major policies of Doug Fuller here.  "Either improve collections or we will find someone that will."  Frankly, I'm not imagining that too many of you folks with lates are that vexed over a chance to better the collection performance.

Totally not the point.  Either a legal agreement is valid and binding, or it isn't.  Prosper doesn't get to pick and choose which provisions apply and which can be disregarded at will.  Moreover, while I think the change is a good one, another lender (who may or may not have received the email from Prosper) may not.  Maybe AmSher is owned by Doug Fuller's brother-in-law, and that's the real reason for the change (ok, probably not, but that too isn't the point).

[Nontyper]

Totally not the point.  Either a legal agreement is valid and binding, or it isn't.  Prosper doesn't get to pick and choose which provisions apply and which can be disregarded at will.  Moreover, while I think the change is a good one, another lender (who may or may not have received the email from Prosper) may not.  Maybe AmSher is owned by Doug Fuller's brother-in-law, and that's the real reason for the change (ok, probably not, but that too isn't the point).

This is whats wrong with America now, no common sense can be used because a lawyer will be waiting around to F it up...

[xraider]

Got the email last night.  I'm surprised that the default (if you don't respond) is to change the collection agency on existing loans. 

Here's something from AmSher: http://www.amsher.com/press/aca_feb05.html

I know I don't like Penncro, but can't say that I'll like AmSher.  However, I don't think Penncro's done a thing for me, so I'll just respond (as I suspect most lenders will) by ignoring the email. 

Of course, it's too much to hope that no more of my loans will go late.

 

[lenderguy]

This is whats wrong with America now, no common sense can be used because a lawyer will be waiting around to F it up...

Um what you fail to recognize is that there are legal mechanisms to void a contract.  One party can't stop performing just because they don't feel like it.

[ira01]

This is whats wrong with America now, no common sense can be used because a lawyer will be waiting around to F it up...

Um what you fail to recognize is that there are legal mechanisms to void a contract.  One party can't stop performing just because they don't feel like it.

Exactly.  And the answer here was simple -- Prosper should have tried sending an email (actually sending it to all lenders would have been a nice bonus) explaining that it would be to lenders' benefit to try a new CA, asking for consent, and only transfering loans with 100% affirmative consent.  Given the very positive response in the other thread, where many lenders here switched their default CA to AmSher, that probably would have generated a fair volume of loans (particularly on loans that had a modest number of lenders).  If that proved ineffective, then perhaps transferring loans with a majority of affirmative consent (51%) would have been acceptable.  But an opt-out system (especially with only a week to respond and many lenders not receiving the email at all) is ridiculous.

[HollowOak]

I think sometimes Prosper is between a rock and a hard place.

They have a legal agreement with lenders. They can see that complying with the legal agreement does not give the desired results. They'd like to try something new. I cannot believe that lenders are so shortsighted that they won't give Prosper leeway to attempt alternative means to improve the situation for lenders.

Sure, Prosper isn't following the legal agreement, but we know that following the legal agreement isn't getting lenders what they want. Should Prosper just write a new legal agreement and wait until enough lenders sign up to the new legal agreement? I think the old lenders will again feel wronged because they are left out of alternative solutions.

I believe that if tested in court (IANAL and this is a nontyper clause), that the legality of the opt-out mechanism will withstand a court test, if it comes to that.  Besides, to sufficiently challenge any of this from a legal standpoint, you'd have to show actual damages to lenders and I don't see how the alternative that is proposed can be any more harmful to lenders.

Technical issues with email delivery also seems to be not something that should stop the entire process.

I think lenders are well advised to give Prosper some leeway here to try alternatives and not to simply kwetch about Prosper not following the legal agreement - we know already what the legal agreement gets us and that's not much.

Beat up on Prosper for the things it doesn't do right, but don't beat them up if they are trying to improve the situation.

[nonattender]

This test is clearly in the best interest of lenders.  Why you're trying to make an issue of it is beyond me.

If Prosper is willing (and they appear to be) to accept whatever liability might arise from doing it this way,
then I certainly don't care since I see the move as a potential long term benefit for both me, and Prosper.

Go to lunch, Ira.  Have a cocktail.

-t

[Mtnchick]

At what point do we draw the line at letting them "try something new" against a current legal agreement?

I think we can all agree that the LENDERS would like to try new things too - so can we just arbitrarily change the agreements and do so? Why can't I just ignore the TOS and contact the lates myself?  If they can change the rules willy nilly, why can't we? Because they are the upper hand. We are the peons.

[HollowOak]

At what point do we draw the line at letting them "try something new" against a current legal agreement?

I think we can all agree that the LENDERS would like to try new things too - so can we just arbitrarily change the agreements and do so? Why can't I just ignore the TOS and contact the lates myself?  If they can change the rules willy nilly, why can't we? Because they are the upper hand. We are the peons.

It's a valid question. I don't think there is a correct answer, but I think your example isn't the line either. Prosper is attempting to work outside the legal agreement with the interests of all lenders involved and with (one hopes) due consideration to the legal ramifications of doing so to itself, the lenders and the borrowers.

If you (hypothetically)  decide to waive some of the contract clauses and attempt to contact the borrower, there is no similar assurance that you have in mind the requirements of any laws in doing so, have the interests of PMI or the other lenders in mind.

However, if you do contact the borrower, I would speculate that Prosper would do very little except abrogate your access to their site and whatever else is necessary to insulate themselves and other lenders from legal issues created by your doing so.

So, go ahead. Give Prosper email notice that you intend to alter the terms of your lender's agreement with them and go ahead to contact some of your late borrowers. Let us know how that works out for you. I'm sure if that you report success, more lenders will follow your pioneering effort.

[Mtnchick]

I won't be lowering myself to their level