With the tax season upon us, Prosper is finishing their last debt sale of the year just in time for 2007 tax year write-offs (because nothing makes a tax filer more cranky than deferring write-offs while having to pay taxes on the associated income).
We completed a debt sale this week which will be evident as of today on the account pages of lenders who own loans that were sold.
When a loan is sold, it is marked as defaulted on the Prosper site and in the performance metrics. If one of your loans was sold you received or will receive an email notifying you of the default and indicating the sale amount. Sale proceeds will be transferred directly into your Prosper account a few days after you receive your email notification.
Here are the details of the sale:
• Eligible loans were more than 122 days past due as of December 4th, 2007, provided the loan was not part of any bankruptcy filing.
• 701 loans were sold.
• Price range: 2.8% - 14.5% (as % of principal).
Pricing is determined solely by the debt buyer and can vary from sale to sale. Several factors were used to determine pricing in this sale, with homeownership, credit grade and state being primary reasons.
The average rates broke down as follows:
|Category||Average Recovery Rate|
|No Home AA, A||9.6%|
|No Home B, C, D||9.1%|
|No Home E, HR||7.3%|
|No Home NC||4.3%|
|All Loans In Texas|
(with the ex's)
The debt collection law in Texas is very debtor-friendly. For example, certain post-judgment remedies are not available there, such as wage garnishment, and in Texas the homestead exemption is not limited as in most other states. Texas courts often rule in favor of consumers in debt collection cases. Therefore, Texas debts sell for a fraction of what debts from other states do.