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Moderator Emeritus
Posts: 32,869
Registered: ‎08-04-2007
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Info on Lending Club

I applied for and received a loan in July from the P2P site, Lending Club, for $15k. I posted several times about my experience with them (all postive, IMO) and based on other posts and my own experience I made the comment on a few posts that LC doesn't report. Well, I was wrong. They reported for the first time today on EX. I got the loan in July and made payments in August and September and it finally reported today.

 

We are in the process of buying a home, but at least we didn't pull the trigger yet with the lender. Sigh. Smiley Sad

Established Member
Posts: 28
Registered: ‎03-30-2009
0

Re: Info on Lending Club

isn't it good that they reported? sorry if i'm not getting this...but if you're making your payments, you want that to be reported? right?

 

i'm looking into lending club as well and wondering if it can help repair your credit.

Moderator Emeritus
Posts: 32,869
Registered: ‎08-04-2007
0

Re: Info on Lending Club


littlebird wrote:

isn't it good that they reported? sorry if i'm not getting this...but if you're making your payments, you want that to be reported? right?

 

i'm looking into lending club as well and wondering if it can help repair your credit.


In most cases, you wouldn't want it to report. In my case, the new account created a ding in FICO scores (12 or so points lost). It pulled down my AAoA by 6 months. And I'm looking to buy a home within the next 3-4 weeks and my DTI took a hit due to the reported payments. Despite prior disclosure, the lender said they wouldn't factor it in if it doesn't report, but now they will. Aside from these, there's no real benefit to having an installment report. Even after the new account ding goes away within 6-12 months and AAoA rebounds, the score gain is minimal at best and maybe there's even a permanent loss up to the point it gets paid off.

 

IMO, don't get it to repair your credit. The best way, per new credit, are revolving accounts like CCs. Even a secured CC is a fantastic way to start all the while minimizing the impact per inquiries. Installment TLs are a tiny part of FICO scoring and they only help your mix of credit if you're carrying a balance. Once it goes to $0, then it is removed permanently from your mix. Probably the only time you'd want it to report is if it is one of your only TLs where a payment history helps when you have none to show or if it is older than your AAoA at which it helps offset the avg. age when you add future, new accounts.

 

And as an update, it has reported to TU and EX, but not EQ. As of the date of this post, I've had it over 3 months.

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