SKFox

As always, you can see all of my Prosper coverage in one place.

I waited longer then I planned too when it came to writing this entry. Prosper has been on the war path. In just the last few weeks they have:

• Issued trademark infringement notices to sites critical of them
• Removed members profiles that are critical and threatened them with suspension.
• Accused Prospers.org of phishing for their users information.
• Fostered such a “good community” on their blog that four days can pass without a single comment passing through their intense moderation

Back to my regularly scheduled post…

The short version…

Member since May 2006.

HR borrower the first time around, paid it off. ($1,000.00 @ 12.50%)
D borrower second time around, 25% paid off, never late. ($4,500.00 @ 13.50%)

Put $50 into my friends loan.

Emailed (in fairly accusatory tone) by Prosper because I talk about them on this blog. How nice of them to notice. It’s probably because I get a lot of traffic from the search engines on prosper keywords and/or because I am a Prospers.org member. Check my freshly minted stats for proof.

The long version…

I joined Prosper on May-16-2006 at 4:49 PM looking to consolidate some credit cards that were being a hassle. I joined a group right away, didn’t get many results, and started looking for other groups. I applied to several. Most I never heard back from, some sent me a nice denial letter, and finally one accepted me. I emailed back and forth with the group leader a few times, then setup a phone conversation for the weekend. We ended up being on the phone for about four or five hours as I recall. He walked me through what Prosper was and wasn’t and how he could help me fund my loan. We went through my five previous (unsuccessful) listings and discussed what about them wasn’t working. By the end of our conversation, my GL decided to fund my loan entirely on his own. This was not unheard of at the time, but rare nonetheless. We stayed in touch and have developed a good working relationship.

In February of 2007, having paid off my previous loan, I discussed another Prosper loan with my group leader. In the time since my first loan, by credit grade had improved from HR (high risk) to D (moderate risk). I asked for substantially more this time and my group leader agreed to fund part of it and leave the rest for the community for chip in on. The key here was going to be several fold to fund successfully:

• Make sure that members of the community could find me and my listing.
• Tout my improvement in credit grade and payment history.
• Do NOT auto-fund the loan so that the rate can be bid down.
• Explain work history, budget, and goals for the loan. Prove that previous goals were attained.

It all went very well. My rate went from 17% APR to 13.5% APR and had 135 bids over 7 days. The money was deposited in my bank account a couple days after close.

It is possible for a high risk borrower to get a loan on Prosper successfully. Don’t expect overnight money. This is a process that takes time, energy, patience, and the understanding that you are taking real money from real strangers. So many borrowers at Prosper default without ever making a payment that it is staggering. My Prosper payments have come first and carry more weight with me because they came from real people just like me and you that are looking to invest their money, get a return, and make a real difference in the lives of ordinary people.