Prosper 50 State Progress - Blue Sky - Lend Trade Borrow

[Investar]

Prosper Marketplace P2P Blue Sky 50 States SEC Lend Trade Borrow News

LIST OF STATES
and
ELIGIBILITY TO PARTICIPATE
under Blue Sky laws

Participation on the 'new' Prosper is governed by state regulation. Although the U.S. Securities and Exchange Commission acts first, each state has the final say. Here is the list of state clearances. Scroll down for state-by-state news and activity reports.

Last activity: Lend and Trade approved in Mississippi
State count now: 27 lending, 47 borrowing
Last review: 01/21/10

L = LEND  lenders may bid and fund loan Notes on the Prosper Loans Marketplace
T = TRADE  lenders may trade existing Notes on FOLIOfn
B = BORROW  borrowers may request loans on Prosper Loans Marketplace 
◊ = approved to participate, approved in this state

L	T	B	State
—	—	—	———————————————————
		◊	Alabama
		◊	Alaska  **active review
		◊	Arizona
		◊	Arkansas
—	—	—	———————————————————
◊	◊	◊	California  approved at launch, lending restrictions apply
◊	◊	◊	Colorado  approved at launch
◊	◊	◊	Connecticut  approved 25 days after launch
◊	◊	◊	Delaware  approved at launch
		◊	Dist of Columbia
◊	◊	◊	Florida  approved 60 days after launch
◊	◊	◊	Georgia  approved at launch
◊	◊	◊	Hawaii approved just after launch
—	—	—	———————————————————
◊	◊	◊	Idaho  approved 25 days after launch, lending restrictions apply
◊	◊	◊	Illinois  approved at launch
		◊	Indiana
			Iowa  borrowing suspended
		◊	Kansas  **active review, borrowing reinstated
		◊	Kentucky
◊	◊	◊	Louisiana  approved 30 days after launch
—	—	—	———————————————————
◊	◊		Maine  lending approved 15 days after launch, borrowing suspended at launch
		◊	Maryland
		◊	Massachusetts
		◊	Michigan
◊	◊	◊	Minnesota  approved at launch
◊	◊	◊	Mississippi  approved 6 months after launch
◊	◊	◊	Missouri  approved 30 days after launch
◊	◊	◊	Montana  approved at launch
—	—	—	———————————————————
		◊	Nebraska
◊	◊	◊	Nevada  approved at launch
◊	◊	◊	New Hampshire  approved 25 days after launch, lending restrictions apply
		◊	New Jersey
		◊	New Mexico
◊	◊	◊	New York  approved at launch
		◊	North Carolina
			North Dakota  borrowing suspended
—	—	—	———————————————————
		◊	Ohio
		◊	Oklahoma
◊	◊	◊	Oregon  approved 25 days after launch, lending restrictions apply
		◊	Pennsylvania  **active review
◊	◊	◊	Rhode Island  approved 36 days after launch
◊	◊	◊	South Carolina  approved at launch
◊	◊	◊	South Dakota  approved at launch, borrower prohibition lifted
—	—	—	———————————————————
		◊	Tennessee
		◊	Texas  borrower restrictions lifted
◊	◊	◊	Utah  approved at launch
		◊	Vermont
◊	◊	◊	Virginia  approved 36 days after launch, lending restrictions apply
◊	◊	◊	Washington  approved just after launch
		◊	West Virginia
◊	◊	◊	Wisconsin  approved at launch
◊	◊	◊	Wyoming  approved at launch
—	—	—	———————————————————

**active review does not mean approval will be forthcoming. It simply indicates there has been activity, the matter is not dormant. **unresponsive indicates silence despite a known inquiry has been made. Refer to footnotes for additional information.

[Investar]

FOOTNOTES AND ADDITIONAL INFORMATION

Predictions on future activity are gathered from a variety of sources, some are hearsay. We also use information from Prosper's website and SEC filings and state activity at Lending Club to guess how and when states will line up on Prosper. News and clues you provide are added to this collection. Thank you!

ALL STATES
◊ Lend and Trade: only states that are able to invest (bid and fund loans) are able to buy and sell existing loans (trade Notes).
◊ Trade: only securitized notes may be traded (only those loans originated since Prosper reopened July 13, 2009).
◊ Borrow: borrowers must qualify as what were Credit Grades AA, A, B, or C (have a minimum credit score of 640). The letter grades still run AA thru HR but are called a "Prosper Rating" and are not the same as the old scale (discussed here). Borrowers who were known as Credit Grade D, E, or HR are no longer eligible (credit scores 520-639) — with one exception. Borrowers who previously had, or now have, a loan on Prosper may apply for a new loan if their credit score is at least 600 (old Credit Grade D). Any qualified borrower may have up to two active loans on Prosper at a time. Qualifications for a second loan are shown in Prosper Help for Borrowers. Click on "Funded Listings: Can I have more than one Prosper loan?"

Alabama
ø Lend: we did not, and do not expect approval
ø Trade: we had expected approval, we do not expect approval
◊ Borrow: approved, no special restrictions
We do not expect approval because Prosper does not verify personal information such as employment and income. This sticking point was also at issue when regulators in Alabama sanctioned the 'old' Prosper (PDF pg2, bottom). Alabama was an early participant in the NASAA states settlement.

Alaska - **active review status per Form S-1A 04/14/09 pg46
ø Lend: we do not expect approval. If approval is granted, restrictions will apply. You must have an annual gross income of at least $70,000 and a net worth of at least $70,000 not counting your home, its furnishings, or your automobile. If you do not meet the 70k income requirement you may still participate if you have a net worth of at least $250,000 not including home and automobile. No Alaska lender may invest more than 10% of their net worth on Prosper.
ø Trade: we had expected approval, we do not expect approval
◊ Borrow: approved, no special restrictions

Arizona
ø Lend: we do not expect approval
ø Trade: we had expected approval, we do not expect approval
◊ Borrow: approved, no special restrictions

Arkansas
ø Lend: we do not expect approval
ø Trade: we had expected approval, we do not expect approval
◊ Borrow: approved, no special restrictions

California - pre-registration began 04/28/09, approved at launch as predicted
◊ Lend: approved with state restrictions, refer to Financial Suitability Requirements for California
◊ Trade: approved
◊ Borrow: approved, temporary interest rate limits have been lifted

Colorado - approved at launch as predicted
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no special restrictions

Connecticut - approved 4 weeks after launch, immediate approval was predicted (approved 08/07/09)
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no special restrictions

Delaware - approved at launch as predicted
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no special restrictions

District of Columbia
ø Lend: we do not expect approval
ø Trade: we had expected approval, we do not expect approval
◊ Borrow: approved, no special restrictions

Florida - approved 9 weeks after launch, immediate approval was predicted (approved 09/14/09)
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no special restrictions

Georgia - pre-registration began 05/21/09, approved at launch as predicted
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no special restrictions

Hawaii - approved just days after launch as predicted (approved 07/16/09)
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no special restrictions

Idaho - approved 4 weeks after launch as predicted (approved 08/07/09)
◊ Lend: approved with state restrictions, refer to Financial Suitability Requirements for Idaho
◊ Trade: approved
◊ Borrow: approved, no special restrictions

Illinois - pre-registration began 05/21/09, approved at launch as predicted
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no special restrictions

Indiana
ø Lend: we do not expect approval
ø Trade: we had expected approval, we do not expect approval
◊ Borrow: approved, no special restrictions

Iowa
ø Lend: we do not expect approval
ø Trade: we had expected approval, we do not expect approval
ø Borrow: borrowing suspended, borrowers prohibited at relaunch 07/14/09

Kansas  **active review status per Form S-1A 04/14/09 pg46
ø Lend: we do not expect approval. If lending is approved net worth restrictions will apply. Lenders must have a net worth of at least $250,000 or have a net worth of at least $70,000 along with an annual income at least $70,000.
ø Trade: we do not expect approval
◊ Borrow: approved, no special restrictions (borrowing has been suspended at relaunch 07/14/09, was reinstated 11/19/09)

Kentucky
ø Lend: we do not expect approval
ø Trade: we do not expect approval
◊ Borrow: approved, no special restrictions

Louisiana - approved 5 weeks after launch, immediate approval was predicted (approved 08/14/09)
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no special restrictions

Maine - approved 2 weeks after launch, approval had not been expected (approved 07/30/09)
◊ Lend: approved, no special restrictions
◊ Trade: approved
ø Borrow: borrowing suspended, borrowers prohibited at relaunch 07/14/09

Maryland
ø Lend: we do not expect approval
ø Trade: we do not expect approval
◊ Borrow: approved, no special restrictions

Massachusetts
ø Lend: we do not expect approval
ø Trade: we had expected approval, we do not expect approval
◊ Borrow: approved, no special restrictions

Michigan
ø Lend: we do not expect approval
ø Trade: we had expected approval, we do not expect approval
◊ Borrow: approved, no special restrictions

Minnesota - approved at launch as predicted
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no special restrictions

Mississippi - approved 6 months after launch, immediate approval was predicted (approved 01/20/10)
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no special restrictions

Missouri - approved 5 weeks after launch, approval had not been expected (approved 08/14/09)
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no special restrictions
Of note, Missouri was an early participant in the NASAA states settlement; the Order by their Enforcement Section (PDF).

Montana - approved at launch as predicted
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no special restrictions
Of note, Montana sanctioned the 'old' Prosper, was an early participant in the NASAA states settlement.

[Investar]

FOOTNOTES AND ADDITIONAL INFORMATION — CONTINUED

Nebraska
ø Lend: we do not expect approval
ø Trade: we had expected approval, we do not expect approval
◊ Borrow: approved, no special restrictions

Nevada - approved at launch as predicted
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no special restrictions

New Hampshire - approved 4 weeks after launch as predicted (approved 08/07/09)
◊ Lend: approved with state restrictions, refer to Financial Suitability Requirements for New Hampshire
◊ Trade: approved
◊ Borrow: approved, no special restrictions

New Jersey
ø Lend: we do not expect approval
ø Trade: we had expected approval, we do not expect approval
◊ Borrow: approved, no special restrictions

New Mexico
ø Lend: we do not expect approval
ø Trade: we had expected approval, we do not expect approval
◊ Borrow: approved, no special restrictions

New York - approved at launch as predicted
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no special restrictions

North Carolina
ø Lend: we do not expect approval
ø Trade: we had expected approval, we do not expect approval
◊ Borrow: approved, no special restrictions

North Dakota
ø Lend: we do not expect lending to be approved
ø Trade: we had expected approval, we do not expect approval
ø Borrow: borrowing suspended, borrowers prohibited at relaunch 07/14/09

Ohio
ø Lend: we do not expect approval
ø Trade: we do not expect approval
◊ Borrow: approved, no special restrictions

Oklahoma
ø Lend: we do not expect approval
ø Trade: we had expected approval, we do not expect approval
◊ Borrow: approved, no special restrictions

Oregon - approved 4 weeks after launch, approval had not been expected (approved 08/07/09)
◊ Lend: approved with state restrictions, refer to Financial Suitability Requirements for Oregon
◊ Trade: approved
◊ Borrow: approved, no special restrictions
Oregon was one of five states driving the nationwide NASAA sanction against the 'old' Prosper. Oregon was an early participant in the settlement that resulted (PDF of their sanction here).

Pennsylvania  **active review status per Form S-1A 04/14/09 pg46
ø Lend: we do not expect approval. If lending becomes approved, to participate you must have an annual gross income of at least $70,000 and a net worth of at least $70,000 not counting your home, its furnishings, or your automobile. If you do not meet the 70k income requirement you may still participate if you have a net worth of at least $250,000 not including home and automobile. No Pennsylvania lender may invest more than 10% of their net worth on Prosper.
ø Trade: we had expected approval, we do not expect approval
◊ Borrow: approved, no special restrictions

Rhode Island - approved 6 weeks after launch, immediate approval was predicted (approved 08/19/09)
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no special restrictions

South Carolina - approved at launch (no delay in lending as predicted)
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no special restrictions

South Dakota - approved at launch as predicted
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no restrictions, borrower prohibition lifted

Tennessee
ø Lend: we do not expect approval
ø Trade: we had expected approval, we do not expect approval
◊ Borrow: approved, no special restrictions

Texas
ø Lend: we do not expect approval
ø Trade: we do not expect approval
◊ Borrow: approved, special restrictions have been lifted

Utah - approved at launch (no delay in lending as predicted)
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no special restrictions

Vermont
ø Lend: we do not expect approval
ø Trade: we do not expect approval
◊ Borrow: approved, no special restrictions

Virginia - approved 6 weeks after launch, two weeks earlier than predicted (approved 08/19/09)
◊ Lend: approved with state restrictions, refer to Financial Suitability Requirements for Virginia
◊ Trade: approved
◊ Borrow: approved, no special restrictions

Washington - approved just days after launch, earlier than predicted (approved 07/16/09)
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no special restrictions
We had predicted Washington to come on board in August or September. Prompt approval may have resulted because Prosper was fresh in their minds. They had just sanctioned the 'old' Prosper, were an early participant in the NASAA states settlement.

West Virginia
• Lend: we had expected approval immediately, expect approval shortly
• Trade: we expect approval
◊ Borrow: approved, no special restrictions

Wisconsin - approved at launch as predicted
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no special restrictions

Wyoming - approved at launch (no delay in lending as predicted)
◊ Lend: approved, no special restrictions
◊ Trade: approved
◊ Borrow: approved, no special restrictions

ABOUT BLUE SKY LAW
and
CONTACTS FOR YOUR STATE

Prosper made application to sell and trade securitized notes in the 50 states and the District of Columbia via standard protocol known as a Blue Sky filing. The "Blue Sky" law is a state law that regulates the offering and sale of securities primarily to protect the public from fraud. Though the specific provisions of these laws vary among states, they all require the registration of securities offerings and sales. Each state's blue sky law is administered by its appropriate regulatory agency.

QUESTION:  When it says "Lend: we do not expect approval," does it mean "never-ever" or "not in the immediate future?"

ANSWER:  Either one could apply. We'll get a better handle on each state as we go along. There may be a few "never-evers." Some "not in the immediate future" might take awhile. There are states who cannot handle the P2P revolution. For them it will be an evolution. Some states will have to rewrite regulation, others will need legislative action. It is way too soon to accept defeat in any state.
 
Most states can easily approve the secondary market where lenders buy or trade existing notes via FOLIOfn. That activity parallels well understood traditional schemas. The primary platform where the securitized notes (loans) are created is the sticky wicket. It is uncharted territory. Some lenders will need to poke-n-prod their state regulators and legislators repeatedly to get the process moving.

Here are some places to go for help:

• BlueSkyLinks.com — find your state regulator. Free, one-stop access to the official websites and resources of Blue Sky regulators in all 50 states and the District of Columbia.

• RollCall-Congress.org — find your state legislators by entering your zip code. Provides office locations, phone numbers, websites, email contacts, more, in all 50 states.

• Prosper's FixTheCreditCrisis.org — OFFLINE not available last I checked. They provided a template letter with address for you to contact your state legislator.

[deskguy]

 thanks for your efforts. so far marylanders could only borrow, which doesn't interest me.

 deskguy

[go4reward]

Maryland - Borrow only, no lending, no trading.

No lending for Maryland?! What a bummer! 

[Investar]

thanks for your efforts. so far marylanders could only borrow, which doesn't interest me. deskguy

No lending for Maryland?! What a bummer! 

We don't know that yet. As it says in the opening paragraph, some clues are hearsay. Maybe what we think we know about Merryland will be just that. Hearsay. I for one am going to see what I can find out when the time comes!

[foofiter]

Glad to see that GA is on the list for all clear.

Which also raises the questions:

- Currently, where are the "big" lenders from?
- How does this affect availability of funds to lend? significantly less or no?
- Will interest rates go up as a result of lower supply? I say yes
- Will this also reduce the number of applications due to less money to borrow?

Only one true way to find out but stuff I have in mind.

Foo

[Beerbud1]

Glad to see that GA is on the list for all clear.

Which also raises the questions:

- Currently, where are the "big" lenders from?
- How does this affect availability of funds to lend? significantly less or no?
- Will interest rates go up as a result of lower supply? I say yes
- Will this also reduce the number of applications due to less money to borrow?

Only one true way to find out but stuff I have in mind.

Foo

Sir, no disrespect intended but "did you ever lend to anyone from GA while prosper was still operating?"......
I did, and it was a mistake. I loaned to several Georgians, only to find out it was a mistake. Even if you discount out the scammers, the others were just as unreliable.

I read long after I made my decisions, that loaning to Georgians as a whole is a mistake. It was discussed on Prospers.org, on at least one thread, maybe more.
I know from first hand experience and reading what other folks experienced That loaning to Georgians as a whole is a mistake.
If you choose to loan to them when prosper re-opens I wish you all the luck in the world.

Beerbud1

[Investar]

I read ... that loaning to Georgians as a whole is a mistake. It was discussed on Prospers.org, on at least one thread ...

According to LendingStats National "Heat Map" New Hampshire is your stand-out with a borrower delinquency rate of 43%. Otherwise the most intrepid region IS the deep south with Alabama and Georgia leading the way at 32% Dq — along with Texas where the delinquency rate is 33% despite borrower interest is restricted to 10% or less which should make repaying easier.

Mississippi is right in there with 30% Dq. Louisiana bucks the regional trend at 27% Dq, a "heated state" number more typical nationally. The southwest is little different. New Mexico and Arizona have 31% Dq. As for California, the state with the largest number of participating borrowers anywhere, they 'boast' 27% of their consort delinquent. All observations as of 02/17/09.

Bottom line, to experience a portfolio default rate ranging above 32% you'd have to somehow manage to find the bad borrowers no matter where you looked. In that case I suggest a strict focus on South Dakota where the Dq rate is zero. Okay, small joke (please don't hit me), borrowers in South Dakota are prohibited from participating on Prosper so you can't go wrong there!

[Investar]

 - Currently, where are the "big" lenders from?
 - How does this affect availability of funds to lend? significantly less or no?
 - Will interest rates go up as a result of lower supply? I say yes
 - Will this also reduce the number of applications due to less money to borrow?

- Eric's "Prosper Lender List" has your answer (click for full table from this link). Unfortunately, you'll have to research them one at a time to see where they are from ("Apply Filter" does not include location, plus some locations on Eric's are hidden — for those insert the username into the open Prosper URL to see where they are from i.e. "prosper.com/groups/member_home.aspx?screen_name=USERNAME"). Still, this will not tell you who intends to continue lending or whether any barred from 'LEND' will opt to 'TRADE' as a substitute.

- Assuredly, there will be an impact on funds available, at least over the early course. I believe the impact is largely contingent on how many states provide what clearances. 100 smaller lenders can effect one big fish.

- I agree, loan rates will likely rise for two reasons: 1) money shortage initially, and 2) lender's insistence on a better risk/reward ratio. During the cooling-off period most have seen how risk interferes with reward over time. In the 'heat of battle' we were continually refreshing our portfolios with new loans that did not falter until later and this inflated our true success-to-term stats.

- Applications will not diminish. Listings were practically infinite before, will be again. Each day there were some 2,200 active listings. Each day only 100 to 150 funded successfully. The number of failed attempts will probably increase in the near term because of a smaller available money supply. That's a good thing in my book. I prefer a borrower with a roster of unsuccessful listings. They often provide valuable insight into the borrowers immediate past history.

[foofiter]

Sir, no disrespect intended but "did you ever lend to anyone from GA while prosper was still operating?"......
I did, and it was a mistake. I loaned to several Georgians, only to find out it was a mistake. Even if you discount out the scammers, the others were just as unreliable.

I read long after I made my decisions, that loaning to Georgians as a whole is a mistake. It was discussed on Prospers.org, on at least one thread, maybe more.
I know from first hand experience and reading what other folks experienced That loaning to Georgians as a whole is a mistake.
If you choose to loan to them when prosper re-opens I wish you all the luck in the world.

Beerbud1

I am not interested in lending to Georgians as much as I am interested in being a LENDER from Georgia. I have lended to Georgians and they are all paying currently.

Foo



« Last Edit: April 23, 2009, 12:42:02 AM by foofiter »
« Moderator Edit: text, author, verbatim April 23, 2009 cached by Investar »

[go4reward]

- Applications will not diminish. Listings were practically infinite before, will be again. Each day there were some 2,200 active listings. Each day only 100 to 150 funded successfully. The number of failed attempts will probably increase in the near term because of a smaller available money supply. That's a good thing in my book. I prefer a borrower with a roster of unsuccessful listings. They often provide valuable insight into the borrowers immediate past history.

That could be good news for lenders because we, the lenders, have more ammos now.

[Beerbud1]

I am not interested in lending to Georgians as much as I am interested in being a LENDER from Georgia. I have lended to Georgians and they are all paying currently.

Glad to hear all your borrowers from Georgia are paying.
Do they know one of there lenders is a fellow Georgian?  Maybe thats why?
 



« Moderator Edit: text, author, verbatim April 21, 2009 cached by Investar »

[Investar]

LIST OF STATES
Last activity: A separate California Only Prosper reopened on 04/28/09
Last review:  04/28/09

Just to be clear, the national Prosper Marketplace remains in the dark. What began operating on Tuesday April 28, 2009 is a mini-Prosper — a separate home-state-only entity beyond the reach of the United States Securities and Exchange Commission. It has its own set of Lender Agreements and Promissory Notes. It does 'borrow' most of the national platform Prosper has proposed to the federal securities regulators.

P2P Lending News has a meaningful recap on the matter titled, Prosper Relaunches in California Without SEC Approval. The post characterizes platform changes and Prosper's national posture after the weekend-long outage that ran Saturday the 25th thru Monday the 27th — and did not produce the 'new' Prosper many had expected.

[foofiter]

I really hope that they get SEC approval soon. I can't wait to get back in the game!

Foo