Last update: May 14, 2020
Since the emergence of COVID-19, we’ve taken and will continue to take aggressive, proactive steps to try to protect investor returns.
With the speed of change and unemployment rising, we’re temporarily adjusting our income verification policy for borrowers, which help us determine whether borrowers can repay their loans.
As a result of the test, we anticipate 95% of borrowers will be verified (versus a historical rate of approximately 60%).
- Effective May 13, 2020, LendingClub is taking additional steps to verify the income of borrowers that, due to their good credit standing, previously may not have been subject to verification.
- Specifically, we are doing a temporary test where 90% of applicants will be subject to new verification policy and 10% will be subject to the original policy in order to assess the effectiveness of the test.
- 90% of applicants will pass through the test verification policy. Under previous policy, a borrower would be considered “income verified” if their income was verified at greater or equal to 90% of their stated income; they would have been considered “source verified*” if their income was verified at less than 90% of the stated income on their application or if their employment was verified. During the test, we will not consider employment verification alone as sufficient; all borrowers noted as “source verified” will be those where income is verified but is less than 90% of stated income.
- The remaining 10% of applicants will continue to be processed through the original policy in order to measure the effectiveness of the test.
These are unprecedented, temporary measures intended to address an unprecedented time. We will continue to adjust and adapt as needed to help protect investor returns and will continue to update investors on platform changes.
*Even if a borrower’s income is verified at less than 90% of stated income, they still must meet DTI underwriting requirements.