It hasn’t happened since September of last year. That was the last time a loan was listed on Lending Club’s platform that did not get funded.
Now, of course, not every listing becomes a successful loan. Some are removed because they fail some form of verification; others are removed by the borrower. But according to Lendstats the last time we saw a valid loan on Lending Club not get funded by investors was in September, 2011.
Good News for Borrowers
So this is good news for any borrower taking out a Lending Club loan. As long as they do everything Lending Club asks of them and all their information on their application is correct their loan will be funded.
If you are a Lending Club borrower there is no need to sit around worrying about whether your loan will get funded. It will. Even when it looks like it won’t.
I have been watching this closely for some time now. On the Browse Notes screen at Lending Club you can sort all the loans by time left. As of this writing the oldest loan on the platform right now has six days remaining and is 90% funded. Clearly that note will easily fund. But it is not always like this.
Just last week I noticed this loan that had just 1 day and 14 hours left and was only 36% funded. Sure enough it funded at 100% and just issued yesterday. Then there was this loan that I thought may be the first loan not to fully fund. The day I checked it had just 1 day and 12 hours left and it was only 14% funded. With a $30,000 loan amount I thought there was no way it would attract more then $25,000 in funding in the last day and a half. I was wrong. It was fully funded before it expired. However, since then it has been removed by Lending Club so this borrower never actually received their money. The fact remains, though, that investors were willing to fully fund that loan.
Where are these Last Minute Investments Coming From?
Now we can’t be sure but it is highly likely this money is coming from within Lending Club itself. There are rules regarding how much the LC Advisor funds can invest in a loan during its first seven days on the platform. But my understanding is that after this time period there are no restrictions. So, on any given day there is probably a large sum of LC Advisors money to put to work and much of it will go towards loans that have been on the platform a while. There is also all the PRIME accounts that Lending Club controls and that may account for some of the late flurry of investment.
Anil over at the Random Thoughts blog had an interesting analysis yesterday that might give us some pause about this last minute rush. His analysis showed that a loan is much less likely to default if it issues within 10 days of its listing date. In fact those loans issued between 14 and 17 days after listing are more than twice as likely to default as those loans that issue within 10 days of listing. So maybe those investors getting in at the last minute will not do as well.
Many Popular Loans Fully Fund in Just a Couple of Days
It is clear that there are many active investors on Lending Club, some with large accounts I expect, who are putting their money to work as soon as loans appear on the platform. Many of the loans I invest in are popular and fund within a week and sometimes much sooner. By the time I get to them some are 90% funded within a day or two. This is why I now invest twice a week in new Lending Club loans rather than once a week which is the way I used to do it. I don’t want to miss out on the popular loans.
What do you think? Have you noticed these loans getting funded at the last minute? Is this a good or a bad thing? As always I am interested in your comments.
I get loan reccomendation notifications via email daily and even though I’m watching those like a hawk, they’re fully funeded some of the time when I look at them. I’m going to stick with the daily looking as it only takes a few minutes each day and I have money sitting idle. Once that’s all invested though I doubt I’ll be so quick off the line as I am now.
This is a big positive for LC and other p2p lenders since it shows that demand for this type of investment far exceeds the supply of borrowers looking for loans. Lending Club could use this statistic to get more borrowers to sign up and grow the market.
On the other hand, the fact that all loans, even those by bad borrowers, are getting funded is a concern because it shows that investors are getting into this without knowing much about how p2p lending works or spending the time to research what the loans they’re investing in. This could lead to bad publicity if LC’s underwriting lets through enough bad loans, hurting the trust or perception of the public for this new type of investment, ie “Lending Club said I was going to get a 15% return, but the guy ended up defaulting and I lost money!”
Also, if demand continues to outpace supply, then interest rates might go down since the loans will still get funded. This could lead to more borrowers signing up for lower rates, growing the supply, which would draw more demand. This may or may not be a good thing depending on where the equilibrium ends up and what the interest rates become.
As conservative investor I have learned of the unspoken rule:
The more creditworthy the loan, the longer it will take to fund.
Data doesn’t support your unspoken rule if Loan Credit Grade is considered as a measure of credit worthiness … more to come
Days to fund the loan, by itself, is a statistically significant predictor of loan loss. However, it does not add anything above and beyond the standard other predictors of loss that people already know. It is merely a weak proxy for all of those things. If people see bad characteristics, they are less likely to fund the loan and it therefore takes longer to fund. There is nothing unique here.
So just to be clear, when you say that every loan has been getting funded, do you mean just “funded” or “fully funded”? Because my understanding is that once a loan gets to the 60% funded number it’ll automatically issue regardless of whether it gets any more money beyond that.
@Jacob, If you are trying to put a lot of new money to work looking daily is a good idea. Particularly these days when sometimes there are 200 new loans added to the platform on any given day.
@Jerry, There is certainly plenty of demand from LC investors these days and it seems that there is more demand than supply. I wouldn’t say it is a huge difference, though, particularly for the retail investors. Lending Club believes that EVERY loan on the platform is a good loan and should be fully invested. So I don’t think they are concerned that investors may be choosing bad loans – they would say there are no bad loans on the platform. While that may be true I think we can do some analysis that will lead us to the best loans – but that doesn’t mean the others are bad.
@Bryce, That is a fair point. We are really looking at the effect that all the other factors have on the speed of a loan funding.
@Dan, In this article I am referring to loans that make it on to the platform, so some may only be 60% funded. However, I did a little more research and was surprised to see that since January this year every loan that has been listed and passed verification has been 100% funded.
Reference Prosper on this topic, not Lending Club, I log into Prosper almost daily at noon, Eastern Time, because the best loans get funded within a few minutes. I know I could use automatic invest, but I want to read the listing myself before investing. Makes for some fast reading before worth-blanket2 buys out 90% of the value of many loans within the first 15 minutes of release. This approach is working with my seasoned loan ROI over 15%.
P.S. – I ordered and studied your video course on P2P lending. Learned some valuable points even after having been actively investing in Prosper since 2007.
@DT, Thanks for chiming in. I am glad you found the video course useful. I know that the fast fulfillment of loans on Prosper is still a problem and one that I intend to continue pressing Prosper on.
Hey, really finding this blog insightful, thank you for providing a great resource! I was originally researching Lending Club because I was planning to apply for a loan with them and wanted to know what I was getting into. Now I am considering making some investments in P2P lending myself. But the point I wanted to make was in regards to the 100% funding. My loan is a $12,000 loan that reached funding in the last 24 hours of listing time. I noticed a rush in the 12 hours leading up to the full funding that included $2,950 (about 24.5%) in investment from 54 investors. Then suddenly I was fully funded with 55 investors. According to the list of users who invested in my loan, my final investor was a PL3 from Sunnyvale, CA. That final investment was $9,050. I am thinking that has to be coming from within Lending Club itself. Anyway, typing on my iPad is a pain, but I just wanted to share my experience in getting last minute funding so that someone researching Lending Club as a borrower can see that the last minute rush investments, presumably from within Lending Club itself (though possibly from an outside investor) are, in fact, happening and approved loans are getting funded.
I should add that before this big investment I went from about $2,000 to $2,950 in about 12 hours after only getting $2,000 funded in the first 12 1/2 days. Loan is an A4 at 7.9% Rate of Return.
@Eric, I think you will find that PL3 is actually LC Advisors. From 2007 until early 2010 Lending Club were located in Sunnyvale, CA so I imagine that is the location used for LC’s own account. You are not alone in having such a large inflow of cash on the last day. Just yesterday I noticed four loans that were all 40% funded or less with under a day to go and I checked this morning and they were all funded at 100% and one of them had $20,000 to go. When you are investing multiple millions of dollars in a month you can afford to take big chunks of loans. Thanks for sharing your experience.
The large investment in the last hours was one of a handful of hedge funds. Probably either Lending Club Advisors or Colchis. Lending Club is smart about how they allow hedge funds to buy into their notes. It’s like a doughnut hole. They can start off with some contributions, perhaps up to 30%, but then they may not invest any more while the retail investors do their share. Anything leftover in the last few hours is then open to institutional investors again.
Where do you look on LendStats.com to find the information that shows that all of these loans were eventually fully funded? I am very worried that mine will reach 60% and not fully fund, which will leave me with an additonal payment without fully consolidating all of my revolving debt!
You go to the Listings Summary page on Lendstats to see if there are any Partially Funded loans: http://www.lendstats.com/loansum/lcloansum.php?mo=06&yr=12
Most months there are no Partially Funded loans although that changed in June and in July I expect there will be quite a few. It takes a few days for these numbers on Lendstats to update. Often you will see a large investor influx in the large few hours because this is where the LC Advisors institutional money comes on board.
Well, here’s to hoping that I am not one of the lucky few who does not get fully funded after it’s too late to withdrawl!
I believe you can withdraw the loan after it has ended if you don’t get fully funded. Best of luck.
I think the stats must be misleading as I followed several loans today that were in their final hours, and when I checked backed later, there listings were not removed but rather no longer found. It seems the stats page is showing all of the loans that were either partially or fully funded. I don’t know for sure, but I was disappointed to see that not one of the 10 loans I followed were able to fund….even past 40%.
How do you know they did not fund if you were no longer able to find them? Obviously I don’t know the specifics you’re referring to but I suspect you’re wrong. Why? Because today is the 1st of the month & LC deploys anywhere from $10-$12 million in institutional money during the first 2 days of every month. This big chunk all at once tends to fund a large number of loans even if they’re at 20-30% prior the deployment. We see this happen month after month.
I am with Dan on this one. Today alone investors put just under $8 million in to Lending Club. When I checked this morning there were dozens of loans that were due to expire in the next 4-6 hours and every one of them has fully funded. There is also 800 fewer loans on the platform right now than there were just 12 hours ago. With $8 million put to work in one day that funded a lot of loans that were only 30% or 40% funded.
I would have to say that you guys are probably right as someone just contrbuted over 10,000 to my loan and it put me at 99.7% funded since my last message.
That “someone” was almost certainly LC Advisors – the institutional arm of Lending Club.
Confirmed. The contribution came from CCF-LCA-2011 out of San Francisco.
There you go…………& that is why from a borrowers perspective, it’s always wise to time the submission of your loan in such a fashion so that it falls within the first 2 business days of the month.
My comment was based on the fact that I thought that the listing marked as funded could still be found using the previous page it was on during funding. Of those 10, they all reverted to n/a status.
The loans can still be found at the URL for each individual loan.
I currently have a pending loan request for $15,000 on lending club. My credit score is 793 and my loan grade is A1 (Best Possible) yet my loan is currently only 18.5% funded after 5 days (Loan number 1468390). I have my doubts that it will get fully funded at the current pace but I trust what you guys are saying. So as it stands I have 9 days left for it to fund or I will have to seek alternative financing measures. If the loan does indeed reach their 60% threshold can I still leave it active for another 2 weeks to see if it can get to 100%. I know I can if it doesn’t.
Read your borrower membership agreement under Loan Documents. If your listing is approved and funded at 60% or above at the time it expires, your loan will issue without notice. At that time, they cannot withdraw the loan. If you opt to pay them back in full, you’re at a loss on their fees. If you choose to withdraw, you have to email them on the business day before your listing expires.
If your listing expires and is funded below 60%, you can choose to either take the loan or put up a new listing. You can’t change the amount, terms, and interest. You are however allowed to change your category and description. Your listing is back to zero at that point.
(This is how I understood the agreement. Please correct me if I’m wrong)
David, I feel confident that your loan will fund. I just checked and I can see your funding is only happening slowly. But as JE points out below a loan can be 50% with 12 hours to go and end up fully funded in one hit.
What happens is that LC leave your loan there for the retail investors and then towards the end of the listing cycle they bring in the institutional money. This money is invested in very large chucks often $10K or more per loan. So with a $15,000 loan you should have no problem getting 100% funded. But it might not happen until the last day.
I was following a $35,000 loan that was about to expire tomorrow and it was only 58% funded. I figured if it reaches 60%, he should decide as early as now whether to take that loan or not, before it’s too late to withdraw. It got fully funded a few hours ago. It was an F1.
@ Peter and JE – I appreciate your insite. That is how I understood the agreement as well JE. I just figured they might give you an option to let your loan stay in funding status a few more weeks even if it reached the 60% threshold (not sure I see the harm in doing so). I guess it is to protect the investers and not tie their money up in something that isn’t earning any interest. Peter I feel confident now that it will get funded but like you said probably not till the last day. Thanks again
I suppose they have to make sure that notes for individual loan request are sold in equal duration. If you’re listing is not fully funded after the 14 day period, you can “relist” not “extend”. You’ll be back to square 1, without any assurance that you’ll have more notes sold to investors compared to the initial listing. If Lending Club invests on the remaining notes to fully fund the request, it works for them in both ways, their investors notes get closed (investors would be happy with that). Plus Lending Club themselves will earn interest on their investment. Their investors are happy. Their borrowers are happy. They’re happy. It’s a win-win for them. Let us know if yours get fully funded. If not, then you’ll be the first not to fully fund since September 2011.
@ JE – Sounds good. I will let you guys know whether it gets fully funded. Thanks again and take it easy.
I see you’re approved and fully funded. Keep us posted if it issues smoothly. Congrats!
Yep. Just as you said. I was about 30% funded with 5 days left then one big investor got the remaining 70% of the $15,000 by themselves. I will keep you posted but I don’t see any reason it would’nt issue. Thanks again for your help.
Congrats David! I am in the same boat as you right now, but I feel much more confident after reading what you, JE and Peter discussed.
DG, If you just placed a loan on Lending Club right now you have chosen the very best time to list. Next week there will likely be more than $30 million coming to the platform from LC Advisors and they will be looking to fund as many loans that are at least seven days old. So, by Tuesday of next week I would bet you will be fully funded.
Peter – Thank you for your comments. Because of your recommendations and website, my loan will be 10 days old by Monday next week. Per your strategy, my intent was to have it listed early in the month with the hopes of having it fully funded within a few days.
I’m hopeful that this will be the case for me as well. I received an offer letter in the mail on Monday and submitted a loan request, which is now sitting at 30% funded (on a loan of $7,000).
Have any of you noticed the bank account verification taking longer than the 2 – 3 business days they mention on the site? I’m not yet in worry territory, but I did notice that as of this morning, the verification debit still has not hit my account.
Thanks everyone! Really enjoying the site, and the loads of information that show up in the comments!
Same here – I was 30% funded with 3 days left, then one big investor (CCF-LCA-2011 a/k/a Credit Card Funding – Lending Club Account 2011 perhaps?) funded the final $6,000 of my loan.
It would be interesting to know whether they’re securitizing these loans or keeping them on the books.
CCF is the Consumer credit fund of Lending Club Advisors, a subsidiary of Lending Club that takes investors’ money ($500,000 minimum if I recall) and invests it in Lending Club notes. They hold the notes until maturity.
@Peter – You were right, I got funded by Tues, Sept 5. I was 25% funded on Friday, August 31st for a $27k loan after my loan had been listed for 7 days. First thing Saturday morning September 1st (after the first 7-day period) my loan was fully funded with an additional $20k by LCA.
However, my loan status has now reverted back to “In Review” for some reason after it said “Approved”
Congrats on the funding. Yes, it looks like LC Advisors put $6-8 million in loans to work this morning and your loan was one of the lucky recipients of part of that cash. Not sure what is going on with your change of status but it probably isn’t anything to be concerned about. Their underwriters are slammed this time of the month.
Let us know when you get your money.
In response to JC, bank verification is between 2 to 3 days. You will have an amount less than a dollar debited from the checking you provided when you submitted the loan.
I was observing a loan that issued exactly 14 days from the time it was listed, being 30% funded after a week and then fully funded by one investor after 7 days. Which confirms what Peter said about the 7 day wait time where LC is limited as to how much to invest.
It takes about 2 more business days from the date it is issued before it’s completely processed. So that person had the money he needed in about 16 days from the time he submitted the loan.
Of course, this is not always the case. I have seen listings that was fully funded even before the 14 days expiration only to see that it has been removed. Perhaps, the borrower could not or did not provided sufficient documents to verify his income. Nonetheless, his listing was fully funded regardless of his eligibility. Although you have been pre-qualified, you still need to be screened further.
@JC – It did not take mine more than the 2-3 days to verify my bank account. I’m very comfortable with the advice from JE and Peter on this site …they nail it every time. You’ll get your fully funded loan, especially since you timed it right by applying at the end of the month like me.
Yes, it looks like there was an issue with the verification. I received an email yesterday afternoon stating they had been unable to complete the debit and asking me to re-enter my information to try the process again. I’m almost positive the information was correct the first time, but there’s no way I can be 100% sure. This time I copied and pasted the routing and account numbers directly from my bank’s website into LC’s data fields. Hopefully the second time will go smoothly. My credit union changed their name seven years ago or so, and occasionally the old name will show up on verification systems, so I’m hoping that doesn’t cause any issue.
As of now I am sitting at 45% funded and hopeful that the rest will come through next week. Thanks again to everyone – hope y’all are having a safe and happy holiday weekend.
So it looks like y’all were right! My loan was 100% funded today, with the last 40% or so being picked up by LCA.
And I discovered the cause of the delay on the bank account verification – my obvious error, which has since been corrected. I’m hopeful that can be completed in the next couple of days.
I appreciate everyone’s assistance and information!
Congrats JC. It might take more than a couple of days as $16 million in loans were funded over the long weekend.
It is also important to note that the agreement states that if at any time your credit score drops below 660, they have the right to remove your listing. So if you’ve already been qualified, avoid credit applications and don’t shop for loans.
Application Status: Under Review
Loan Status: Removed
does this mean I didn’t get approved for the loan?
Yes, that typically means that while your credit qualified you to apply for a loan, Lending Club found something in your application that didn’t meet their requirements. You can always request an explanation from them as to why you were denied.
Peter,
I have the same status as linda. Could I possibly still get approved. I
I got 100% fully funded within hours. Is there any reason I won’t get the loan now as long as I verify all the information they want. Or is there another “approval” that needs to be passed. First time borrower and definitely interested in the future as a lender. Thanks.
You will need to pass the verifications that Lending Club request. This can involve just simple address verification to requests for financial information and detailed fraud prevention questions. As long as there are no red flags during the verification process your loan will get approved.
Hey, I know this article is a bit old now so I’m wondering if all loans are still be funded as they were in 2012? Has this changed at all or is Lending Club still working out pretty well?
Yes, all loans are still getting fully funded at Lending Club. There is far more investor demand today than there was two years ago so yes, you could say Lending Club is working out pretty well.
What are the credit requirements now for LC? i’m pretty sure i qualify but just checking.. i was sent a preapproval notice.. but forgot to use it when i requested my loan.. my loan is funded but under review so just wondering how long that process takes and if i will be notified if something else is needed…
Hi Terry, The process is reasonably quick – just 3-4 days typically. I expect you will hear from someone at Lending Club by Friday at the latest. It doesn’t matter that you forgot to use the pre-approval notice, they will still go through the same verifications with you.
thanks for the quick response and yes, it was approved today.. assuming all i need to do now is wait for the funds to be deposited i have to say this was a pretty amazing experience.. ONLY feedback would be some communication with LC.. it’s kind of nerve racking to keep watching a website for updates.. would love to have a POC that helps me through the process.. but that’s just me 🙂
This is an online process so there isn’t a lot of human touch involved. Once you are approved and fully funded you should see funds in your account within 24-48 hours.
One more question. If you want to make additional payments to the balance so as to lower the amount of interest paid over time or pay it off early how do you so that if payments Are automatic?
Yes Terry, you can make additional payments whenever you like. This will reduce the total interest you will pay. And you can also pre-pay the balance early if you like. You can always call Lending Club for a payoff balance. Regular payments will be taken from your checking account automatically.
I applied for a loan July 9, and my loan became “fully funded” in a week. My status STILL says “under review” with the fully funded loan about to expire in two days. What happens if it expires while “under review?” I’ve only had to verify my bank and email, they have not asked for anything else.
This is the same for me.
Applied for a loan on the 4th of September, it was fully funded in under 24 hours…
I verified everything they asked me for within 1 business day, but I my status has remained “Under Review” for the last 4 business days.
Reklaw, Loans can stay under review for several days. It may be something specific to your application or it may be they have experienced a spike in loan demand and they are getting behind. Either way, you will find out in a matter of days.
Does anyone have experience with the lending club funding process? Yesterday my loan was at “approved” status with 5 days remaining and funding at 0%. This morning status still shows “approved” and funding at 0%, however the remaining days have increased to 28 days and 17 hours. Any insight on funding timeline here?
Wow! I’m so glad I came across this site. I’m approved (B1 level) and have been in funding for only a couple of days now. It’s a bit nerve-racking every time I log on to see activity. I’m doing credit card refinancing, so I sure hope I get fully funded. It’s a slow process in the beginning, huh? I’m only 4.81% funded with 11 days to go! As a newbie, you definitely get that feeling like it won’t happen. I am happy to have read all these responses. Thank you.
B1 loans tend to move a little more slowly than the higher interest loans but every loan is still getting funded. There have been a huge number of loans on Lending Club in the last couple of weeks, as they did a big end of quarter push, but the oldest loan has been on there for 10 days. EVERY loan that was approved on the platform 11, 12, 13 and 14 days ago has been fully funded. So, you may have to wait a few days but it will happen for you.
If you like I don’t mind you posting a link to your loan here so others can view it and possibly invest.
Hi Peter and thank you. My fingers are crossed. Here’s the link: https://www.lendingclub.com/browse/loanDetail.action?loan_id=29224631&previous=browse
I woke today to being fully funded! I feel a huge relief off of my shoulders. I had a little over 9 days left, so this was a huge surprise this morning. Everything is verified, so I guess now I wait.
Congratulations Amy. That is earlier than I expected. Thanks for letting us know.
Hi Peter and thank you. My fingers are crossed. Here’s the link: https://www.lendingclub.com/browse/loanDetail.action?loan_id=29224631&previous=browse
Hi, I’m getting worried my loan is only 45 percent funded and I only have 4 days left. It’s very slow going and in need of this loan. And help about getting or not getting funded. I’m asking for 12, 000
Michelle, There are some loans today that are taking 12-13 days to fully fund. But rest assured EVERY loan is still being funded. Be patient, I am confident you will be fully funded in 2-3 days.
Hi Peter, do you know if this 100% funding percentage and last day trend rings true for Prosper as well?
Hi Joan, At Prosper it runs more like 90-95% of loans getting funded. You still have a good shot at it but it is not 100% like at Lending Club.
I’m very curios at who fully funded my loan, I was invested by one person at a hundred percent within 10 minutes of filling the info out. I really can’t see why I would be, one I didn’t realize that you had to have a credit score of 660 or greater plus my DTI is over 30 percent. I applied for a moving and relocation loan. The credit terms on interest is high. I didn’t know any of this until after I read the borrowers membership agreement. I had already applied. Why would I qualify instantly and what does this mean? They asked for verification of a couple items. The investor I.D is EDFNP from San Mateo, CA
Hi Sharon,
At both Lending Club and Prosper loans get randomly split into one of two categories: whole loans for large investors and fractional loans for small investors. Your loan was put in the whole loan bucket. These large investors have different investment criteria, some like lower interest rates, others like higher interest rates. Clearly your loan appealed to one of these investors. And typically, these large investors will fund your loan immediately, which is what happened in your case.
You will still have to go through verification but as long as you provide everything to Lending Club quickly you should see the money in your account soon.
This can’t be right. I checked the browse notes section and cannot find my loan. It has been “funding” for 8 days but doesn’t exist in the notes section. So I think they must hide some loans from being findable.
I hope you were able to obtain your loan. If you give us your loan number we can do some digging to find out what happened.
Hello…
I applied for a $20,000 consolidation loan on 4/14 and was approved. The loan was fully funded by the next morning. Email and bank verification is done. Requested documents (W-2 and two months pay stubs) were submitted day one. Loan continues to say “under review”. Is there any chance my loan will not get a final approval in the underwriting process and then I get an “adverse action” notice? Why is it taking so long? Please advise…any feedback would be helpful. Thanks!
I have to say the approval process is slowwww. It still says final review for the last 6 days and I haven’t been asked for any documentation. I’m use to being approved next day by my credit union. Not being fully funded yet just adds to the pain. Also I must have missed the fine print but apparently there is an origination charge! Oh well. Live and learn.
This is my second loan with LC. The first one was approved and funded quickly. I submitted the application and was told it funded 100% within hours. The process is taking longer than the first one because I had to resubmit some documents that were too blurry when I scanned them. I checked my account status yesterday and it said everything was complete and funds would be deposited into my account but I never received an email from them confirming this. I thought maybe it was because it was Friday afternoon or something. Should I be worried?