Prosper unveils individual portfolio plans and improves search

Prosper rolled out several upgrades to their website ahead of Prosper Days. Last month Prosper lender HollowOak polled lenders on what upgrades might be coming. There may still be new features announced at Prosper Days but here's how we fared so far:

• The secondary market for loans
• Increase in the minimum credit grade that may create a listing
• Publication of legal actions against defaulting borrowers - Prosper did announce they would sue select delinquent borrowers. This, however, was not tied to the upgrade last night.
• Increase loans servicing fees - Prosper already raised borrower's fees a couple weeks ago.
• Increase state rate caps - Prosper did raise the interest rate cap in the District of Columbia from 6% to 24%. However, Arkansas, Delaware, Kentucky, and Tennessee have had interest rate caps lowered based on the change in federal interest rates.
• A national Prosper license - Lending Club is national but we are still waiting on Prosper
• Increased options on the search loans feature more granular credit data - Search options are improved but it does not feature credit data. Verified friends were added to the search feature.
• Credit report from more than one credit reporting agency
• Reduced minimum bid size - Prosper is at $50. Lending Club is at $25. We found most Prosper lenders do not diversify. In fact, a full 70% have less than 20 loans. A lower minimum bid size would help Prosper lenders diversify.
• Lenders can create their own portfolios - Yes! A nice upgrade here.
• Lenders can publicize their portfolios for other lenders to follow - Yes! It can be shared on your member page.
• Stock options for long-time lenders
• 3rd loans for borrowers - No, but they did change the eligibility criteria for borrowers who wish to create a listing for a 2nd loan, raising the minimum number of recent consecutive on-time payments from 2 to 6 months.
• Borrower refinancing their loans directly
• Revolving credit loans
• The entry of corporate lenders - Globefunder is the best P2P lending option for corporate lenders right now.
• Changes (unspecified) to loan verification - Lenders will no longer see the "Bank account verified" icon. Borrowers do not receive a loan until their bank account is verified so Prosper views this as an unnecessary item to publicize. Andrew Martinez-Fonts from Prosper says, "bank account verification is rarely the item that prevents origination."
• Streamlined borrowing for AA-B credit grades
• Enhancements to the Friends and Endorsements program - No, but Prosper did raise the referral bonus from $35 to $50.
• Complete elimination of groups

Again, there may still be new features announced at Prosper Days but these are the website upgrades. Prosper has detailed information on their blog and I've republished it below:

Portfolio Plans for everyone

Now lenders can create their own portfolio plans, with all of the controls available in the existing portfolio plan templates. Existing standing orders have also been converted to portfolio plans, and will include estimated return data (when available) to help lenders make better lending decisions.

Additionally, lenders can now share their portfolio plans on their member page. If you think you have a great lending strategy, share your plan, and other lenders can copy it for their own use (or even tweak it if they think it needs some changes). Building (or just editing) a portfolio plan is easy, and with built-in performance data, you’ll be able to better predict the performance of your plans.

Social criteria added to search

Ever wondered if having verified friends really makes a difference in a borrower’s default rate? Now you can find out, with four new search criteria added to advanced search, portfolio plans, and the marketplace performance page:

Bids from friends ($): Sum of highest single bids from the borrower’s friendsBids from friends (#): Total number of bids from unique friendsEndorsements: Number of endorsements from the borrower’s verified friendsFriends: Number of verified friends the borrower has

Bidding via API

You can now bid via the API with your personal account. Each account must be activated to allow API bidding. Send an email to APIServices@prosper.com to enable API bidding on your personal account.

Prosper expects developers will begin to create applications that make use of this capability; however, at this time, the terms of service on API bidding is limited to individual accounts.

Bid Source available in loan list

The “Your Account > Lending > Loans” page now includes a new column called “Bid source”, which will indicate what the source of each loan was. For example, if you placed a manual bid, the “Bid source” column will say “Manual”. If a loan came from a portfolio plan, the plan will be named in that column.

Lenders can use this to look back at loans made in the past and determine which bidding strategies are working, and which are not.

2nd Loan Criteria Changed

Prosper updated the eligibility criteria for borrowers who wish to create a listing for a 2nd loan, raising the minimum number of recent consecutive on-time payments from 2 to 6 months. This means that a borrower who wishes to take a 2nd loan on Prosper must have had at least 6 months of consecutive on-time payments (pre-payments don’t count) before he or she is allowed to create a listing for a second loan.

“Bank account verified” icon retired

The “Bank account verified” icon has been retired from the site as of this release. Initially, this icon was added to listings because having a verified bank account was the only hurdle to borrowers wishing to have their 100% funded loans originated, and a borrower’s failure to verify his or her bank account could delay the deployment of a lender’s bid. At present, however, bank account verification is just one of many verification procedures that gate a loan’s origination, and bank account verification is rarely the item that prevents origination. In addition, there are many misunderstandings among new borrowers and lenders over what the icon means, when it is activated vs. hidden, and how it affects the funding of a loan. As a result, we have decided to remove the icon from listings, search, and search results. No loans are originated without a borrower verifying ownership of his or her bank account.

Referral award for new borrowers raised from $35 to $50

If you refer a new borrower to Prosper whose loan is funded, you can earn $50 from Prosper. You can also still refer a lender, and both of you will earn $25 when he or she funds his or her first loan.

Washington DC interest rate cap raised to 24%

Prosper has raised the interest rate cap in the District of Columbia from 6% to 24%. Additionally, Arkansas, Delaware, Kentucky, and Tennessee have had interest rate caps lowered commensurate with the Fed’s lowering of interest rate indexes.