Last night we did one of the biggest releases of code to the Prosper site that we’ve ever done. What? You didn’t notice anything? Perfect.
One of the less glamorous sides to building web sites (or building anything, come to think of it) is that sometimes you have to stop working on the sizzle and get working on the steak. To use another analogy, someone had to frame up the canvas before Picasso could start laying down paint.
So this release is largely behind the scenes. If you’ve gotten this far, you might like to know what a few of those improvements are, so here goes…
Institutional lenders
One of the few visible changes to the site is to add an improved interface for our institutional lenders. Since the site launched over two years ago, we have had a handful of institutional lenders (hedge funds, money managers, etc.) participating on the platform. In this release we improved the account infrastructure that allows us to support institutional lenders, and hope to have many join our lender community. From the outside, however, you won’t see any differences - institutional lenders won’t appear differently than individual lenders. If you are an institutional lender who would like to participate in Prosper, please get in touch.
Credit reporting
As you probably know, Prosper reports borrower payment activity (and inactivity) to Experian and TransUnion on a monthly basis. This is important both for improving (or negatively affecting, as the case may be) borrower’s credit histories, and also for establishing Prosper as a mainstream credit provider. Our new code automates more details, which will help us continue to report accurately and in a timely manner every month, as the volume of payment activity increases.
Bankruptcy tracking
As of this release, we’re automating more of our bankruptcy tracking to set the stage for us to be able to start giving lenders the bankruptcy chapter number and filing date in the future.
Loan originations
We’ve also made some back-office improvements to our data handling process that should help us avoid delays in the pre-funding verification process.
We hope you enjoy the changes and hardly notice a thing. If you have any requests for the next release, please leave a comment.
We made an update to the site last night to add a new feature to portfolio plans.
Prosper has updated the criteria in the templates for the Conservative, Balanced, Moderate and Aggressive portfolio plan models. This will not change the criteria of your portfolio plans; however, if you wish to alter your plan criteria to match the updated criteria, we make it convenient for you - just click the “Update” link on your list of portfolio plans.
If you have used one of the templates in the past to create a portfolio plan, you’ll see something like this in your list of portfolio plans:
You can review the new criteria, and when you click “Update”, you’ll be able to adjust the amount to bid, diversification, and/or plan criteria. Once you confirm the plan changes, all of the updated criteria will replace the previously saved criteria.
Of course, if you choose not to update your plan, the criteria will remain the same. Maybe you are happy with the criteria as they are, or you customized the plan with your own criteria, so if you want to ignore the update, just click “Ignore”, and the message will go away until the next update. For now, you’ll need to ignore each update individually as they come along.
Updates aren’t just available for the Conservative, Balanced, Moderate, and Aggressive portfolio plan models. If you copied a plan from a friend, and your friend updates the plan criteria, you’ll have the opportunity to update that plan, too.
We’re all taught: when in polite company, don’t talk about money, sex, politics, or religion. I don’t know about the last three, but when it comes to money, people are decidedly tight-lipped. A cousin once confided in me (after a few drinks) that he’d racked up $50,000 in credit card debt. You could have knocked me over with a feather! Here’s a guy who went to college, has a good job, and seems to live a normal lifestyle. And he’s overspent enough to feed a quarter of a million children for a day.
How could I have not known this? I mean, he’s family, right? But people are very private with their money, and I would argue, without reason.
With the exception of having a mortgage, debt is looked down on in the United States. But according to CardRatings.com, 60% of Americans don’t pay off their credit card bill every month. So it’s not uncommon to carry a balance. What can set you apart from the crowd, though, is paying off your credit card balance in a smart way. That’s where Prosper comes in.
Okay, so you think Prosper is a cool idea, and you put up a listing. You’re really hoping that some of those lenders notice you with that picture of your cute dog and adorable kids. And maybe if you’ve got stellar credit, you will get some bids. But chances are you probably won’t.
There is something you can do about it. Tell someone. Seriously. Do it. It will help.
When you ask for a loan on Prosper, you’ll probably upload your picture, and you might write a long story about how much that kitchen remodel set you back. Or how you wrecked your car, but it was, like, totally not your fault.
And we Prosper lenders get that. We know you need a loan; otherwise you wouldn’t have jumped through Prosper’s hoops to ask for one. But we’re looking for a little commitment from you, too.
So tell someone, already. I did it, and I managed to get a great loan at an embarrassingly low interest rate.
No, we haven’t started making loans to canines. But this borrower has a $200 bid from a neighbor and fellow church-goer. Missmanhattan says “Mike is a neighbor and personal friend of mine.”
This borrower was referred to Prosper by someone who was an existing lender, and has already placed $650 in bids on the loan. By referring the borrower, Zorg (the lender) will also enjoy $50 when the borrower’s loan gets funded.
He’s already got a $50 bid from a friend, and an endorsement from his kid (probably unverified because you have to be 18 or older to get verified). And with an estimated return of 24.61%…
So give it a try. I know it’s a little weird asking friends and family for money. But when you’re only asking them for $50, and their small bid can help you get your whole loan funded, it’s easier than you think. Heck, if you invite them to Prosper, you’ll each get $25.
So what’s stopping you? Leave a comment and let me know.
Last night we released some big changes to the Prosper site.
Nationwide lending at 36% interest rate cap
After a couple years of turning away Nevadans completely and forcing Pennsylvanians to set their interest rates below 6%, we are opening up the marketplace to borrowers in almost every state of the union, with a marketplace-wide rate cap of 36%. Learn more on our new legal compliance page.
Minimum instant transfer amount lowered to $50
For lenders who install Prosper’s Facebook application, we’ve lowered the minimum transfer requirement from $500 to $50. Additionally, the maximum instant transfer amount has been raised to 50% of your active loan value.
What this means is that with as little as $100 in active loans, you can instant transfer $50 to Prosper for that “must have” loan that you just came across.
Prosper’s Facebook application keeps your Facebook friends updated on your Prosper lending activity, and is a great way to share Prosper with your friends and family.
Second loan criteria updated
The requirements for borrowers who wish to take a second loan on Prosper have changed. The new rules for whether a borrower is eligible for a second loan are dependent on the borrower’s credit grade, and the factors taken into consideration include time since last loan originated, consecutive months of on-time payments, and whether the borrower’s credit grade has dropped or not.
Lender servicing fee for AA changed to 1% per annum
The lender annual servicing fee for AA borrowers has changed to 1%. Listings created on or after April 15 will be subject to this new servicing fee. Learn more about fees and charges.
Listing durations standardized at 7 days
Along with some other changes to the listing creation process, we have fixed the duration of all new listings to 7 days. This change is part of a larger effort to simplify the listing creating process, and help more borrowers create fundable listings.
Your tax forms are right here
If you are a lender who owned loans in 2007 or earlier, and are eligible to receive a Consolidated Form 1099 from Prosper, your 1099 is available from the “My Account > Statements” page. Learn more about tax reporting.
There are many other changes under the covers, and some not-so under the covers. We hope you enjoy the changes, and look forward to getting your feedback. Please leave a comment.
We generally don’t like to pre-announce new features here at Prosper. But over the past few months we’ve put so much time and energy into a new feature called “Predictive Bidding” that we’re too excited to keep it under wraps any longer.
After mining our database of lender activity (don’t worry, no canaries were harmed), we detected some common patterns in lender activity before bids were placed:
Lenders scrolling heavily on the listing page, back and forth between credit data and Q&A.
Lenders clicking “Bid Now”, checking the estimated default, backing out, then clicking “Bid Now” again, then backing out, then sending a message to the borrower.
Lenders reporting the listing, then asking the borrower a question, then inviting a friend to look at the listing.
In each of these patterns, the likelihood that the lender would then place a bid on the listing was upwards of 95%! In an effort to save our lenders some precious time, we decided that when we observe these patterns (among others), we should just go ahead and place a bid on the lender’s behalf. It’s kind of like a portfolio plan where the main criterion is your excitement level!
We’ll be rolling out this new “Predictive bidding” feature on April 1st. And in the following months, we look forward to extending predictive bidding with these improvements:
Predictive Portfolio plans – lenders who run the same search more than 10 times in a week will have a portfolio plan created for the full amount of their cash balance.
Eye tracking – using that webcam mounted on your monitor, we’ll detect when your eyes get big and excited about a juicy loan. If your account’s got $50 in it, you’re in.
Predictive funds transfers – if your account ran out of money because of all those predictive bids, don’t worry – we’ll initiate a transfer for a fresh $500. You deserve it.
All these predictive features aren’t just for lenders, either. Based on some borrower data that is finally coming to light, we’re starting to see correlations between how a borrower fills out the registration form, and her credit grade, income level, and loan purpose. When we can predict these characteristics to 98% accuracy or better, we’ll bypass the Experian score pull, and auto-insert the income and listing description (everyone puts in $100/mo. for food anyway).
We hope these improvements to the marketplace are helpful to borrowers and lenders alike.
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Andrew is a Product Manager at Prosper and today is April Fool’s.
