I am considering making a listing to borrow money (probably several months in the future) and have some questions about one's credit rating. I assume that the only thing a potential lender will see is the score. But it would be nice if Prosper could reveal things like late payments, collections, etc...

Let me explain my situation. My credit rating is probably somewhere around B I would guess. I have never had a late payment, no defaults, no collections, etc... The reason for the B rating is because of extensive use of credit for income/investment properties. My main debt is mortgages on these properties. My only revolving credit card debt is at a fixed rate (5.99% and less). This is from ONE large purchase that we are paying off over 3 years or so. The credit cards that we use daily are paid to zero every month.

Anyway, my point is that I would like a lender to know some these things, and not only go by the credit rating, and I'm wondering if they will have any more information from Prosper. Or do I simply need to tell them myself in my (future) listing?

Thanks.

Mike

Hi Mike,

Your credit score (or grade, as we display it) factors in all of those elements that you're describing: debt burden, late payments, collections, etc. So although you can add as much detail as you want to your listing, the idea is that your credit grade will reflect all of those elements.

Best regards,
Andrew

Hi Andrew,
I think you are implying that Prosper's credit grade is merely the FICO score which summarizes magichael's credit experience. However, whatever detail magichael provides related to the credit grade received is completely subjective.

Unless the FICO formulae is transparent, i.e. publically available someplace, how am I supposed to know, as a lender, the components of how the FICO scores is derived? magichael has an interesting point. B)

First of all, these are Experian Plus scores, not FICO scores. Furthermore, the full version of the FICO formula is highly proprietary.

That notwithstanding, the significance of various chunks is typically broken down as follows:
Past payment history 35%
Outstanding debt 30%
Length of credit history 15%
Recent credit applications 10%
Types of credit and loans you have 10%

What does this actually mean? Beats me -- there are various online simulators that purport to recalculate a credit score while you play around w/various changes to accounts, adding new latenesses, new accounts, etc-- better than nothing, i suppose

wow - like the fifth interesting topic on this forum tonight.

OK, isn't Chris Larsen (prosper-CEO) quasi-famous for the eloan thing about finally sharing their own FICO scores with consumers? How funny is it that no one knows what the FICO score actually represents! Is it really that meaningless a gesture? Come on Chris - drop the other shoe! - cause a meltdown, and make a profit off it! I'll help!

funny thought - Is FICO that open to manipulation (or emulation) that it has to be kept secret? ahhaha...

-todd

The formula is the secret sauce of Fair Isaac -- you'd better bet that they keep its precise derivation fairly secret! It certainly is open to manipulation, even w/the minimal info publicly available.

Hey cellerdoor,

How'd you put that signature line on the bottom of your posts. Enquiring minds want to know.

Tom

go to "my controls"
choose "edit signature"
voila!

Thanks, let's see if it works....

Cellardoor:

Could you elaborate on the "proprietary" nature of the Experian Plus/FICO scores? Are you saying that the formulae is "secret", covered under some type of IP law?

Do you have a web link to these online simulators you reference?

Thanks! What an interesting signature you have!

yes to secrecy -- even the scoring formulae for the non-FICO scores are proprietary. Typically, even when licensed out to end users (corporations that lend, say, vs individuals checking on their own scores), they function as black boxes.

I just realized that all the simulators are free, but typically packaged w/one-time purchases -- eg, myfico.com requires the purchase of at least 1 credit report, before one gets the fico simulator.