Anyone Ever Use - Posted by Jake

Posted by John Corey on September 30, 2006 at 06:13:38:


The group has been set up. Creative Real Estate Financing is the title. I can email you an pointer to the group as I sent one to myself when they approved the group.

A couple of observations based on my limited time on Prosper.

  1. Your credit score will define who looks at your loan.

  2. Your interest rate will define if you get funded if the credit score is reasonable. If the credit score is bad then how you explain yourself will matter.

  3. As the credit score goes down you find that people get real picky about seeing your budget and other evidence that the loan is solid. I suspect you will get someone upset with the idea that you are going to use the funds to trade futures. Hence you could end up with negative PR on the forum and that might damage your ability to get funded.

  4. If you do not need the cash then borrowing less might be a good idea. New borrowers who do not present well but are not asking for that much seem to get funded. Borrowers who ask for a lot and have a great story can still struggle. Given that most loans are funded in $50 or $100 chunks it will take a lot of people to support a larger loan so lots of people have to collectively buy into the story. With a smaller loan the list will be smaller and might be made up of just a few lenders who lend a large sum (large for Prosper).

  5. Some lenders will only lend to people who select the auto fund option and have a verified home. The auto fund says that once there is enough pledged the process stops and you do not have the chance that the interest rate will be bid down. The verified home means that they have checked to see that you really do own a home.

  6. Being a lender is a good experience for learning about Prosper. You can just as easily start out as a borrower. That is up to you.

Let me send you that email and we can continue…

If anyone else wants to check out Prosper send me an email (just click on my name where you see “Posted by John Corey” in the heading).

We can continue the discussion here for those who want to follow along.

John Corey

Anyone Ever Use - Posted by Jake

Posted by Jake on September 28, 2006 at 14:16:32:

Has anyone ever used to either loan money or to obtain a loan? Seems like an interesting idea…

Re: Anyone Ever Use - Posted by John Corey

Posted by John Corey on September 28, 2006 at 14:58:35:

Correction in the subject line as to the domain name spelling.

I started using the service to learn more about it. I am creating a new group to focus on RE as we know and love it here.

My views.

Prosper presently suffers from growing pains. Too many new borrower and lenders who are learning their trade. Newbies all. Nothing wrong with that but it means a lot of questionable loans.

Prosper as a firm is too new so in many states they are stuck with loan limits on the rate that are not aligned with the borrower risks. Hence there are many quality borrowers who can not pay enough to make it worth while.

There are borrowers who are high risk or they fall outside the model. People who have joint income but the scoring focuses on the one person who registered. Or people like you would find here who can make a bunch on a deal but do not verifiable income, prior credit issues or other events.

As Terry Vaughan says, what good is a high credit score when something can happen tomrorow that completely changes the situation. Hence a AA quality borrower might have a problem in 30 days. As the loans are unsecured you get lumped in with the other creditors.

What do I like?

That more people will be educated about credit. That more people will consider lending privately. That it is fun to bid down an interest rate if you are the borrower. That there is a community of lenders.

I definitely think the idea is interesting. How it might work in the larger market remains to be seen.

If you want to join together in a group on Prosper let me know. I figure the RE savvy folks can group together and see if there is a way to use Prosper for lower cost financing. Granted it would be better if an LLC was allowed to join rather than just an individual.

My Prosper ID is: TrueHardMoneyLender

I bet that is not much of a surprise to some.

The group is not approved yet but the group request has been submitted so I can keep you posted if you care.

John Corey

PS. The UK has Zopa. It was started by some folks I worked with at Egg plc (UK online bank). I was running software development at the time. Zopa is making noises about coming to the US.

Re: Anyone Ever Use - Posted by Jake

Posted by Jake on September 29, 2006 at 19:51:09:

Thanks for the spelling correction! It’s for anyone interested. I think it’s a great idea, but I also agree with the kinks that need to be worked out. But the overall idea is great. I’d love to be kept updated on your group. I’ll write it down so I dont forget it.

Im actually going to attempt to get a small loan to trade futures with. Not sure if people will go for it or not, but I figure it’s worth a shot. Im gonna go for approximately $8,000. I actually have the money but wanna test out their system. I only plan to trade with $5,000. Im going to set the first 3k aside to pay the first 6 months or so, to give my self even more breathing room. Ive been demo trading for a few months now and have done extremely well. I figure it’s about time I went at it with real money.

I’m also interested in loaning money as well. I just want to get more information on how the whole system works,etc. btw - Ive also heard talk about Zopa coming to the US… group URL - Posted by John Corey

Posted by John Corey on September 30, 2006 at 06:20:27:


As you used a bogus address in your post here I can not send you the URL.

Here is a shorten version (meaning it will display in this message without wrapping problems). It goes to the Prosper page for the Creative RE Financing group I created.

John Corey