Buzz kill time! After five on-time payments, one of my Lending Club loan borrowers has just stopped paying the bill. I’d hoped this wouldn’t happen (of course I hoped this wouldn’t happen!), but it is sort of interesting to see how Lending Club handles it when someone stops returning their phone calls (literally).
When I logged into my account, I noticed it no longer listed my loans as “Issued and Current (2),” but rather “Issued and Current (1)” and below that, “Late 31 – 120 days (1).” Uh oh! So I checked in on it – August’s payment hadn’t gone through, and the one at the end of September had just “failed” as well. I’m not exactly sure what it means for a payment to “fail,” though. I suspect it might mean that my borrower had their payments set up as automatic withdrawals from a checking account, and when Lending Club went to take the money, there just wasn’t enough in the account.
At the bottom of the loan page, Lending Club helpfully listed the actions they had taken, in reverse chronological order. Here’s a screenshot (if it’s too small to read, click on the image to view it full-size):
Of course, that “Engaged external collections agency” at the top doesn’t thrill me one bit. But it’s really nice to see that Lending Club has been doing a lot to try and get payments out of my defaulted borrower. It’ll be interesting to see what happens from here. If a collections agency buys the debt, will I get a portion of my money back? Or will the collection agency try to collect without buying the debt, and so maybe I’ll have to wait?
If the collection agency buys the debt for pennies on the dollar, I could be out 22 bucks in free Lending Club opening-bonus money. I guess I can’t feel too bad about it, especially when I know people not paying their bills is simply a part of life. But… dangit!