A sad statement about the priority of the regulatory agencies and their targeting of the few open markets that allows people to lend to people without needing a bank is apparent by the list of P2P vendors actually open and doing business:
Lending Club – Made it through the regulatory hoops and is now conducting business by connecting worthy borrowers with lenders. All while Citibank, Bank of America, and Chase are reducing credit lines or even closing credit card accounts.
I thought we were supposed to be injecting MORE liquidity into the credit markets, not encouraging big lenders to put in new roadblocks? Okay, so explain this:
Prosper is Currently in a Quiet Period
We have been overwhelmed by the outcry from potential investors around the country who want to participate in peer-to-peer lending. Thank you for your support and your letters to us.
After much consideration we have decided to voluntarily shut down our operation in order to complete our SEC approval for a nationwide peer-to-peer lending platform. As a result, due to regulatory concerns, and in the interest of working toward getting our registration statement effective as soon as possible, we are discontinuing our California intrastate offering at this time.
If you’re an existing lender, your current lender agreements will be unaffected; your existing loans will continue to be serviced; you’ll be able to track and monitor your loans; and you’ll be able to withdraw funds from your Prosper account.
If you are a borrower with an existing loan, you will continue with your current borrower agreement and be unaffected by the registration process.
We want to assure you that Prosper is looking forward to being able to offer a transparent, durable and participatory lending institution very soon.
As a result of this decision, we will not be accepting new lender or borrower registrations or loans, or new commitments from existing lenders effective immediately. Until this process is complete, we are required to be in a quiet period and will be unable to respond to press, blogger or other inquiries related to our SEC registration process, even though we would like to.
We sincerely apologize to the Prosper community members for this inconvenience or disappointment our decision may have caused. We want to thank those of you who demonstrated your support through your active participation whether by investing with us again or referring friends to our site.
Thank you in advance for your understanding, support and patience once more. We look forward to serving the needs of the community in the hopefully not too distant future.
NOT their fault! The same agency – SEC – that could not sniff out a 50 Billion dollar fraud is clamping down on a company helping facilitate $178 Million in loans. That is LESS than .4% of the total Madoff take!
Total Marketplace Statistics Since Inception
Reported as of 3/31/2009
Prosper Members: 834,000 # of Units % of Total
Originated Loans: $178,610,222
Loans Paid in Full: 5,684 20% Outstanding Principal Balance: $66,808,846
Number of Loans: 28,939 Active Loans: 17,401 60% $ Current (≤30d past due): $60,845,131
Average Loan Size: $6,172 Loans Charged-Off 5,854 20% $ Late (≥31d past due): $5,963,715
≥640 Credit Score: 2,082
Average Borrower Rates (≥640 Credit Score): 14.5% <640 Credit Score: 3,772
Average Borrower Rates (<640 Credit Score): 23.7%
Good for the SEC, Madoff, the big banks and bad for the (prudent) investor and the credit worthy borrower.
Who else is out there? Well, there are a lot of places that refer to themselves as “P2P Finance,” but the reality is that they are trying to put lipstick on a pig (credit union or banks) and market it to the Twitter savvy population.
All else being equal, I prefer Prosper as a P2P platform. I was able to get an excellent loan for $25,000 from Prosper. But, while they are in their quiet period, I can recommend the Lending Club platform (yes, affiliate link! I gotta eat.). I borrowed $2000 about 18 months ago and the process was pretty good. I was not happy that I couldn’t get much more than $2,000 (since I was eventually able to get $25K from Proper), but maybe that will change in the future once Propser comes back online and Lending Club has some more competition.
New Hampshire –