back in business

Looks like danteshek might get another crack at Russia: Reopens for Lending By Brad Stone Back in October, we reported that the SEC was forcing, a peer-to-peer lending site, to temporarily stop taking new loans as it evaluated whether the company should register as a securities broker. Although it is still waiting for SEC approval, Prosper says it has gotten a thumbs-up from the California Department of Corporations to start brokering new loans from residents and businesses in California. The site will be open to borrowers nationwide. In its first incarnation, as you might recall, Prosper was strictly an auction-based online market for personal loans. Lenders competed with each other to make three-year fixed-rate loans to prospective borrowers, who described why they needed the money and threw in the occasional story of personal hardship for good measure. The new Prosper will do a bit more — and less -– than that. The site will no longer accept loan listings from individuals with credit scores under 640. That’s not surprising, as the default rate of Prosper loans had been creeping upward last year, and many of Prosper’s competitors have concluded these unreliable borrowers are not worth the risk. Prosper is also introducing what it is calling the Open Market Initiative, a way for lending institutions to put any loan–an auto loan or small business loan, for example–up for sale and allow any person or institution to bid on it. Prosper will vet lenders and require three payments to have already been made on any loan up for sale.

Can I securitize these loans?