The first debt sale was in Dec 2006 with 51 loans sold.
- 27 - 30%: Homeowners with any credit grade
- 15 - 18%: Non-homeowners with a credit grade of D and above
- 3.0 - 3.7%: Non-homeowners with a credit grade of E and HR
- 16 - 19%: Homeowners
- 2.4 - 3.3%: Non-homeowner
Here are the details from this third sale:
- Eligible loans were 122 days past due as of July 26, 2007, provided the loan was not part of any bankruptcy filing
- 309 loans were sold
- Price range: 1.8% - 26% as a percent of principal balance
- AA-A = 23%
- B-D = 13.3%
- E, HR, NC = 8.1%
In the second Loan sale it seems the primary determining factor was homeownership, and some lenders had changed their bidding strategy to factor that in. One lender who goes by the name of PrintAns commented in the Prosper forums, "I hadn't viewed homeownership as good or bad when picking the listings until the last bad loan sale. When they sold bad loans more was given for loans where the borrower was a home owner. I now use home ownership part of my criteria."
In a way it seems unfair for Prosper to be changing the rules of the game, but in reality it is the debt buyers that change their criteria and the amount they are willing to pay for different types of loans based on the changing economic conditions in the marketplace. It probably doesn't help that liquidity for all types of debt purchasing has been drying up throughout the economy.
John Witchel, Prosper's CTO, commented about the debt sale process on his blog several months ago. He specifically mentions two challenges they face in these debt sales. The first is that Prosper is a new and different asset class, and the debt sales are typically geared more toward established asset classes like credit card debt. The second challenge is volume. It takes a certain volume to attract debt buyers, which is the primary reason for the infrequent timing of the debt sales.