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Author Topic: Prosper not good at amortizing...  (Read 6343 times)

cubbiesnextyr

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Prosper not good at amortizing...
« on: June 16, 2009, 01:33:49 pm »

I have a loan that has made every payment exactly on the due date.  The amount paid each time is 2.088471 (my share at least).  Payment # 36 is coming up and I have 2.138388 of principle left, meaning the payment will have to be higher then the normal payment to get this correct.  That's not what their amortization table shows.  I wonder what they're going to do.?

Something seems screwy here.  I think their math was wrong in there somewhere.  The cumulative effect of having a different number of days between payments perhaps?  30 vs 31 vs 28?

Payment number   Post date [Sorted by Post date, descending order.]    DPD    Type   Status   Total paid   Prosper fees   Late fees   Interest   Principal   Principal balance
4884638    Jun-11-2009    0    Automatic    Paid    $2.09    -    -    $0.10    $1.99    $2.14
4804689    May-11-2009    0    Automatic    Paid    $2.09    -    -    $0.14    $1.95    $4.13
4731620    Apr-11-2009    0    Automatic    Paid    $2.09    -    -    $0.19    $1.89    $6.07
4643032    Mar-11-2009    0    Automatic    Paid    $2.09    -    -    $0.22    $1.87    $7.97
4557992    Feb-11-2009    0    Automatic    Paid    $2.09    -    -    $0.28    $1.80    $9.84
4467491    Jan-11-2009    0    Automatic    Paid    $2.09    -    -    $0.33    $1.76    $11.64
4379290    Dec-11-2008    0    Automatic    Paid    $2.09    -    -    $0.36    $1.73    $13.40
4288981    Nov-11-2008    0    Automatic    Paid    $2.09    -    -    $0.41    $1.68    $15.13
4197433    Oct-11-2008    0    Automatic    Paid    $2.09    -    -    $0.44    $1.65    $16.81
4096512    Sep-11-2008    0    Automatic    Paid    $2.09    -    -    $0.49    $1.60    $18.46
3998113    Aug-11-2008    0    Automatic    Paid    $2.09    -    -    $0.53    $1.56    $20.06
3908884    Jul-11-2008    0    Automatic    Paid    $2.09    -    -    $0.55    $1.54    $21.62
3812726    Jun-11-2008    0    Automatic    Paid    $2.09    -    -    $0.60    $1.49    $23.16
3717593    May-11-2008    0    Automatic    Paid    $2.09    -    -    $0.62    $1.47    $24.65
3612081    Apr-11-2008    0    Automatic    Paid    $2.09    -    -    $0.67    $1.42    $26.12
3419133    Mar-11-2008    0    Automatic    Paid    $2.09    -    -    $0.66    $1.43    $27.54
3246725    Feb-11-2008    0    Automatic    Paid    $2.09    -    -    $0.74    $1.35    $28.96
2884041    Jan-11-2008    0    Automatic    Paid    $2.09    -    -    $0.77    $1.32    $30.31
2566979    Dec-11-2007    0    Automatic    Paid    $2.09    -    -    $0.78    $1.31    $31.63
2198462    Nov-11-2007    0    Automatic    Paid    $2.09    -    -    $0.83    $1.25    $32.94
2028501    Oct-11-2007    0    Automatic    Paid    $2.09    -    -    $0.84    $1.25    $34.19
1768766    Sep-11-2007    0    Automatic    Paid    $2.09    -    -    $0.89    $1.19    $35.44
1627686    Aug-11-2007    0    Automatic    Paid    $2.09    -    -    $0.92    $1.17    $36.64
1482391    Jul-11-2007    0    Automatic    Paid    $2.09    -    -    $0.92    $1.17    $37.80
1348198    Jun-11-2007    0    Automatic    Paid    $2.09    -    -    $0.98    $1.11    $38.97
1218607    May-11-2007    0    Automatic    Paid    $2.09    -    -    $0.97    $1.12    $40.08
823416    Apr-11-2007    0    Automatic    Paid    $2.09    -    -    $1.03    $1.06    $41.19
680848    Mar-11-2007    0    Automatic    Paid    $2.09    -    -    $0.96    $1.13    $42.25
564028    Feb-11-2007    0    Automatic    Paid    $2.09    -    -    $1.08    $1.00    $43.38
459697    Jan-11-2007    0    Automatic    Paid    $2.09    -    -    $1.11    $0.98    $44.39
377377    Dec-11-2006    0    Automatic    Paid    $2.09    -    -    $1.10    $0.99    $45.37
316757    Nov-11-2006    0    Automatic    Paid    $2.09    -    -    $1.15    $0.93    $46.36
257725    Oct-11-2006    0    Automatic    Paid    $2.09    -    -    $1.14    $0.95    $47.30
204481    Sep-11-2006    0    Automatic    Paid    $2.09    -    -    $1.20    $0.89    $48.24
162697    Aug-11-2006    0    Automatic    Paid    $2.09    -    -    $1.22    $0.87    $49.13
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cubbiesnextyr

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Re: Prosper not good at amortizing...
« Reply #1 on: June 16, 2009, 01:35:56 pm »

Interesting, this is from the promissory note:

Quote
Note. The final payment shall consist of the then remaining principal, unpaid accrued interest and other charges due under this Note. All payments will be applied first to any late charges then due, then to any costs and expenses incurred hereunder, then to interest then due and then to principal. No unpaid interest or charges will be added to principal.

I think this will be a surprise to borrowers...
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Xenon481

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Re: Prosper not good at amortizing...
« Reply #2 on: June 16, 2009, 01:36:02 pm »

Wow.  Even something as simple as that.  Unfortunately, I haven't had any go to 36 months yet so I can't corroborate.

ETA: Nominating to The Lobby.

cubbiesnextyr

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Re: Prosper not good at amortizing...
« Reply #3 on: June 16, 2009, 01:37:08 pm »

Wow.  Even something as simple as that.  Unfortunately, I haven't had any go to 36 months yet so I can't corroborate.

ETA: Nominating to The Lobby.

Fine with me.
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vsqueen

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Re: Prosper not good at amortizing...
« Reply #4 on: June 16, 2009, 01:55:35 pm »

http://www.prosper.com/invest/listing.aspx?listingID=13239

This loan went 36 on time payments.  All payments were $3.91 except the last payment.  That amount was $4.06. 
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cubbiesnextyr

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Re: Prosper not good at amortizing...
« Reply #5 on: June 16, 2009, 01:59:04 pm »

http://www.prosper.com/invest/listing.aspx?listingID=13239

This loan went 36 on time payments.  All payments were $3.91 except the last payment.  That amount was $4.06. 

Wow.  I'd be pissed if I was the borrower...
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ira01

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Re: Prosper not good at amortizing...
« Reply #6 on: June 16, 2009, 02:26:00 pm »

http://www.prosper.com/invest/listing.aspx?listingID=13239

This loan went 36 on time payments.  All payments were $3.91 except the last payment.  That amount was $4.06. 

Wow.  I'd be pissed if I was the borrower...

Me too.  We all knew (although most borrowers probably didn't) that the last payment would often be larger than usual due to any late payments along the way, but for Prosper to screw up the amortization is really beyond belief even for Prosper.  That is the meat and potatoes of their whole operation -- how hard is it to get that right?
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DCS

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Re: Prosper not good at amortizing...
« Reply #7 on: June 16, 2009, 02:35:12 pm »

I have my first loan that has gone late because of the larger payment at the end.

http://www.prosper.com/invest/listing.aspx?listingID=16145

This one had gone 4+ months late at one point, so the amount over the usual payment is larger than it would have been had there been 35 previous on-time payments.

However, the borrower has made a manual payment of her usual amount ($1.65 for my part).  As the borrower has come this far and been on-time for the last year and a half, I can only guess that the remaining balance ($0.56 for my part) will be paid next month.
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yankeefan

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Re: Prosper not good at amortizing...
« Reply #8 on: June 16, 2009, 02:57:30 pm »



Something seems screwy here.  I think their math was wrong in there somewhere.  The cumulative effect of having a different number of days between payments perhaps?  30 vs 31 vs 28?


Prosper calculates interest on a daily basis (rate/365, I think).  The payment schedule is monthly.  Getting the loan in June,  the borrower is paying 31 days interest instead of 30 and 5/12 days (365/12), so he's not paying down as much principal as the payment calc expects.  Plus, there is a Leap year to put in another day of interest.

The math works, but the payment and the payoff calcs are different, as you suspect.   
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Urbi_et_Orbi

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Re: Prosper not good at amortizing...
« Reply #9 on: June 16, 2009, 02:58:15 pm »

Not top hijack, but based on the comments above, I was looking at the payment tables for one of my loans with pay-off in proress..
http://www.prosper.com/invest/listing.aspx?listingID=10540

Quote
Payment
number         Post date   DPD  Type    Status           Totalpaid Prosperfees Late fees Interest Principal Principalbalance
OP4908175   Jun-15-2009  35  Manual   Processing      $0.00  -  -  -  -  - 
OP4893971   Jun-09-2009  0    Manual   Paid              $0.05  -  $0.00  $0.00  $0.04  $0.00 
OP4821276   May-12-2009  0   Manual   Paid              $1.66  -  -  $0.02  $1.64  $0.04 

How is it possible to be current on May 12 and on June 9 - and then be 35 DPD on June 15?
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brianguy

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Re: Prosper not good at amortizing...
« Reply #10 on: July 13, 2009, 12:18:47 pm »

I knew something was wrong with OP.  it really is principal, even though this has nothing to do with Prosper being our pal.
unlike in school (younger grades), when they like to tell kids how to spell principal because the person in charge is their pal. 
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brianguy

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Re: Prosper not good at amortizing...
« Reply #11 on: July 13, 2009, 12:20:06 pm »



Something seems screwy here.  I think their math was wrong in there somewhere.  The cumulative effect of having a different number of days between payments perhaps?  30 vs 31 vs 28?


Prosper calculates interest on a daily basis (rate/365, I think).  The payment schedule is monthly.  Getting the loan in June,  the borrower is paying 31 days interest instead of 30 and 5/12 days (365/12), so he's not paying down as much principal as the payment calc expects.  Plus, there is a Leap year to put in another day of interest.

The math works, but the payment and the payoff calcs are different, as you suspect.   

that makes good sense...
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cubbiesnextyr

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Re: Prosper not good at amortizing...
« Reply #12 on: July 23, 2009, 02:15:52 pm »

To close the loop on this:

The borrower PIF and even was able to cover the larger final payment.  The borrower had 36 automatic payments made, exactly on the due date.  At 28.75% rate to boot! 

I netted $74.85 on my $50 loan, a $24.85 profit, which covers about half of one of my "make 2 payments and stop" loans. 
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