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Author Topic: Prosper failed to verify income on reported listing  (Read 5150 times)

DCS

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Prosper failed to verify income on reported listing
« on: July 31, 2008, 09:28:55 pm »

(copy/pasted from verified forum by request)

A borrower posted to the .com forum a couple of weeks ago asking why she wasn't getting bids.  I took a quick look and noticed that her credit numbers looked OK, but she had not stated income and thus no DTI was calculated.  I told her that if she could state her income and if her DTI was 40% or less, she'd qualify for the portfolio plans.

http://www.prosper.com/lend/listing.aspx?listingID=365073

https://connect.prosper.com/p/3951/18045.aspx#18045

She replied with a follow up question on a Friday evening, so I PM'ed her back a response to avoid the weekend posting delay.  This started a cordial back and forth for several messages, as she had some questions about Prosper.

She reposted her listing with a stated income range of $50k - $75k, apparently just high enough to get her to 40% DTI.  Portfolio plans fired away.

http://www.prosper.com/lend/listing.aspx?listingID=367698

I noticed in her new listing text she said, "My income changed from my other listings because I figured my income from my employer incorrectly."  So I checked her previous listings, and indeed, she had stated an income in the very first of seven listings: the lowest range of $1 - $25k, which yielded a DTI of 156%!

She "figured incorrectly" by more than $25k?

Worried that I may have just directed a pig to the lipstick counter, I reported the listing.  I specifically told Prosper I was suspicious of the stated income because it had jumped so much from a previous listing and had been increased to just barely enough to qualify for the portfolio plans.

When the listing funded, it was pending verification for a week.  Then it became a loan.

I then contacted the borrower and asked her what post-funding verification she experienced, noting that lenders have read inconsistent stories from borrowers about the process Prosper implements.  Her response:

Quote
The verification that I went through was sending a voided check for my bank account verification, the first one they didn't receive and then they sent me an email to fax a copy of the check which I think that they should have done in the first place.

I don't know if they verified anything with my job that I get my benefits through. If they did check it would have been easy enough for them to because it is automated.

I think that they tried calling me on my house and cell phone, because I had a different CA number on my caller ID, but no messages. I tried calling the number back and line was busy.

I did see that on the lenders board, that lenders were wondering about the verification process. I did have everything ready to be faxed, because no one seems to know what they would ask for.

If you have any more questions please let me know! Thanks

So, no faxing of W-2 or paystub!
« Last Edit: July 31, 2008, 09:30:44 pm by DCS »
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ira01

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Re: Prosper failed to verify income on reported listing
« Reply #1 on: July 31, 2008, 09:39:39 pm »

Well, if we're recreating the other thread here, I'll add my part:

If Prosper was going to ignore my report and not verify income anyway, why the heck did they even bother to hold the loan in "pending verification" for a week?!?!

Probably because they were waiting for the mailed, then faxed, voided check.

This is ridiculous (though certainly expected) conduct by Prosper.
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Urbi_et_Orbi

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Re: Prosper failed to verify income on reported listing
« Reply #2 on: July 31, 2008, 11:13:32 pm »

Lobby?

nonattender

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Nothing that I ever say is "professional advice" - principally, because I suffer from an infinitely inescapable prinicipal/agent problem, in that I am, in principle, always acting as my own agent.

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Fred93

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Re: Prosper failed to verify income on reported listing
« Reply #4 on: August 01, 2008, 12:01:55 am »

Does somebody have that famous quote from silly prosper-shira?  Something about prosper's "crack team" of fraud investigators.

112233

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Re: Prosper failed to verify income on reported listing
« Reply #5 on: August 01, 2008, 12:21:32 am »

Does somebody have that famous quote from silly prosper-shira?  Something about prosper's "crack team" of fraud investigators.

this one?

Quote
Prosper's fraud detecting abilities are much more sophisticated than snippets of information coming from snooping lenders here and there. We have bank records, address records, phone records, IP addresses, and other copious amounts of information about the borrowers that lets us do a much more thorough and definitive assessment of risk and fraud. Your snippets (which are additive to the data we already have) are more valuable coming through your "Report this listing" reports than being posted on the forums.
http://www.prosperreport.com/prosper/forums/archive/threads/3/0/7/30759.3.HTM#post380243

Cushie

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Re: Prosper failed to verify income on reported listing
« Reply #6 on: August 01, 2008, 01:19:29 pm »

Lobby?

Yes, please. 

And re-reading that thread you linked, Numbers, sure does get my blood boiling.  We gave them every opportunity and they just turned their backs. 
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christoofar215

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Re: Prosper failed to verify income on reported listing
« Reply #7 on: August 01, 2008, 07:09:41 pm »

So, no faxing of W-2 or paystub!

Prosper almost NEVER verifies W-2s or paystubs.

You'll be hard-pressed to find a recent loan where that verification actually happened.  FTR, all they did with me is setup a 3-way call with my bank to verify my account.


That was it.  Originated the next day after the phone call.
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ira01

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Re: Prosper failed to verify income on reported listing
« Reply #8 on: August 01, 2008, 07:13:57 pm »

So, no faxing of W-2 or paystub!

Prosper almost NEVER verifies W-2s or paystubs.

Yeah, why should Prosper do anything to catch or deter loan fraud -- it is the lenders who take it in the shorts when a borrower claims $100K+ but really makes $20K, and Prosper already collected its origination fee (and gets to brag about its origination numbers, not that they are anything to brag about).
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