LendingClub.com - My Experience

[willuw]

So, my small business is growing and I went to LendingClub.com for a loan for the business after many good reviews.

Asked for a loan of $2,000.  It was fully funded within a couple of hours.  They asked me to call to verify phone number - I did and they instantly approved me over the phone, they said they released the funds and they would be deposited in my account the next day.

I even received an email that my loan was approved and I would be receiving my funds by the next business day.  

Awesome! Great experience!

Next business day rolls around and I check my account - no funds.  Later I get an email saying my loan had been denied.  What???

I ask them why and they said they "heard" from an "undisclosed source" that my loan was for college education which they can not fund.  

I have my 4 year degree and a technical two year certificate and have absolutely no desire to go back to college and never made a mention of it for this purpose - the loan said for business major purchase..

Well after arguing with several people and supervisors - they refused to honor their loan just because a "source" said it was for college education.  Not happy..

[llecs]

Wow! That's nuts. It's also weird they promised the funds the next day. My $15k loan funded very quickly within a couple of days, and then it took another week before they verified my income, reviewed my pay stubs, etc. Did you answer any questions indicating that it was for school?

[willuw]

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@llecs wrote:

Wow! That's nuts. It's also weird they promised the funds the next day. My $15k loan funded very quickly within a couple of days, and then it took another week before they verified my income, reviewed my pay stubs, etc. Did you answer any questions indicating that it was for school?

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It took mine an hour tops to get funded ($2k) They never verified my income or asked for pay stubs.

I answered no questions which makes me question where they got the whole college education thing even more...

Not cool at all for approving a loan and then declining it the same day the funds were suppose to be in my account for a made-up reason..

[Anonymous]

I'd take my business elsewhere.

But, in case you still want business with them....

I'd call them back, speak to the higher ups, and super-nicely explain (to as many people as it takes) that someone has confused you with another person. You probably already did this, though. Did you confirm whether the "source" provided other identifying information, such as both first and last name, birthday, SSN, etcetera, to differentiate you from another person with a similar name. What they are doing is upholding slander and defamation of character! Offer to pay the loan back in 30 days to prove it. Don't use the funds. Pay it back in 3 weeks, paying increments, such as at 10 days, 15 days, and lastly at 21 days. Then apply for another loan. This should support your credibility. I hope they give you another chance, if not because you want future business with them, then just so you can make a point.

[willuw]

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@Anonymous wrote:

I'd take my business elsewhere.

But, in case you still want business with them....

I'd call them back, speak to the higher ups, and super-nicely explain (to as many people as it takes) that someone has confused you with another person. You probably already did this, though. Did you confirm whether the "source" provided other identifying information, such as both first and last name, birthday, SSN, etcetera, to differentiate you from another person with a similar name. What they are doing is upholding slander and defamation of character! Offer to pay the loan back in 30 days to prove it. Don't use the funds. Pay it back in 3 weeks, paying increments, such as at 10 days, 15 days, and lastly at 21 days. Then apply for another loan. This should support your credibility. I hope they give you another chance, if not because you want future business with them, then just so you can make a point.

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I have taken my business elsewhere - it's a shame as their rate was pretty decent.  They refused to tell me who or what "the source" is or even look into it.  They refused to let me talk to a supervisor telling me they already did and the supervisor can't do anything.  I even offered to send them RECEIPTS of what I used the loan money for to prove that it was definitely not for education.  They declined this as well and said their decision was final (yet they approved it and funds should have already been in my account)  Doesn't seem right to me...

[Anonymous]

Takes all kinds to make a world... lower ranks included.

[Anonymous]

I just wanted to post this info to share.

According to them:

Inquiries don't count if they're not within the last 6 months

4 inquiries is the max

You can reapply six month later if declined (like I was)

Business loans report to personal CR

They only pull TU

The pull is a SOFT pull

They don't ask for SSN unless the system needs to, then it's a hard pull, I believe (you can check on this)

Minimum score is 660

Balance showing on more than one card is too much (you can check on this, too)

The rep said there is no human involvement in the process, so the "system" automatically declines once you've exceeded the limits. I called back, and confirmed that there is no human factor when deciding at all. I'm not sure what they were getting at with the OP's horrible experience, but I think something is severely wrong with they way they processed the application.

A thought occurred to me, too. OP, check on your TU report notes and see if there is a notation there about school loans. I've had some weird notes on my reports that prevented me from getting a higher limit on my personal loans last month that I requested deleted. Check the other CRs, too. I had a couple negative notes about my current and previous addresses that raised some eyebrows unnecessarily, along with some erroneus name spellings. All I had to do was just request the CB to remove them, and presto!, no more questions or delays. Anyway, this may not be your issue, but just wanted to pass along my experience. YMMV.

[Swapmeet]

Try prosper.com. I have recently opened an account and began investing over there, since tax free muni bonds have such low coupons in these days of very low interest rates.

[willuw]

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@Swapmeet wrote:

Try prosper.com. I have recently opened an account and began investing over there, since tax free muni bonds have such low coupons in these days of very low interest rates.

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I actually tried prosper - but I was denied because my credit score was not high enough for them.. 

Some guy from LendingClub has started calling me like 3X a day while I am working telling me to call him immediately but won't state why..Kind of over them already and would rather find the funding elsewhere..

[Swapmeet]

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@willuw wrote:

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@Swapmeet wrote:

Try prosper.com. I have recently opened an account and began investing over there, since tax free muni bonds have such low coupons in these days of very low interest rates.

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I actually tried prosper - but I was denied because my credit score was not high enough for them.. 

Some guy from LendingClub has started calling me like 3X a day while I am working telling me to call him immediately but won't state why..Kind of over them already and would rather find the funding elsewhere..

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Wow, this is odd. The information that I have read says that prosper has easier underwriting requirements, which is why they offer slightly higher returns than Lending Club. Oh well, I guess this just goes to show that I can't believe everything that I read (I read it in the "Prosper vs. Lending Club" article at investorjunky). Maybe Prosper has changed a bit since the article was written.... It seemed reputable at the time, but I trust your first hand experience.