Collection Agencies

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If one of your loans becomes delinquent, you will use a collection agency to help attempt to recover unpaid balances. You may select a unique collection agency for each new bid, but you will select one as your default agency when you are setting up your lender account.

How is the collection agency determined?

On delinquent loans with multiple lenders, Prosper will use the collection agency selected by the lender or lenders who have the most loan funds outstanding on the loan. In the event of a tie, the agency will be selected at random.

Because one collection agency will have responsibility for collection, all of the lenders on the delinquent loan will pay that agency's fees out of any amounts collected. If no amount is collected, lenders do not pay collection fees.

How do collection agency fees work?

Collection agencies charge a percentage of any recovered funds as the service fee for their efforts. This percentage varies by collection agency, but is typically between 15 and 30% of the funds recovered. The percentage the collection agency keeps also goes down over time, so the collection agency has an incentive to collect delinquent amounts promptly.

What happens if the collection agency can't collect?

If the collection agency can't collect payment from the borrower after a reasonable period of time (within 3 months), the loan will be considered uncollectable, marked as "Defaulted", and sold to a debt buyer. The borrower will not be able to borrow ever again from Prosper, and since we report delinquencies to credit reporting agencies, this default will adversely affect their credit report. Learn more about default sales and debt buyers.

The following is a list of the collection agencies that Prosper has partnered with to provide collection services to Prosper lenders.

AmSher

http://www.amsher.com/

AmSher is a family business. The firm started in 1939 as a credit-clothing store, later expanded into the credit furniture business and, in 1986, evolved into the nationally ranked receivables management firm. AmSher is headquartered in Birmingham, Alabama with a second collections location in Tulsa. They are licensed to collect in all 50 states.

Fee for collection services:
17% of funds recovered*

Prosper Performance

	Last 3 Months			Lifetime
	AA-A	B-D	E-HR	AA-A	B-D	E-HR
Sent to agency:	$319,575	$1,454,715	$536,842	$319,575	$1,454,715	$536,842
Collected: Gross Net after fees	12% -	8.25% -	11.88% -	12% -	8.25% -	11.88% -
Accounts sent:	155	948	875	155	948	875
Brought current: In mo. 1 at agency In mo. 2 In mo. 3 In mos. 4+	11.61% 10.97% 0.65% 0% 0%	6.75% 4.96% 1.27% 0.53% 0%	8.11% 5.94% 1.6% 0.57% 0%	11.61% 10.97% 0.65% 0% 0%	6.75% 4.96% 1.27% 0.53% 0%	8.11% 5.94% 1.6% 0.57% 0%

Firstsource, LLC

http://www.firstsource.com/

Firstsource Solutions Limited is a global provider of collections and outsourcing solutions. Our focus is on delivering exceptional results to our clients. Our global standards, proven expertise and extensive experience have supported many of the nation's most prestigious companies dramatically improving their collection efforts. We ardently address and challenge ourselves on issues of performance, productivity, results, reporting processes, automation sophistication and associate satisfaction.

Fee for collection services:
15% of funds recovered in the first month*

Fee decreases to 10.5% in the second month and to 7.35% thereafter.

Fee increases by 5% for any payment collected which brings borrower balance current.

Prosper Performance

	Last 3 Months			Lifetime
	AA-A	B-D	E-HR	AA-A	B-D	E-HR
Sent to agency:	$11,700	$17,552	$22,449	$12,000	$58,298	$74,473
Collected: Gross Net after fees	96.56% -	0.51% -	15.86% -	96.27% -	5.62% -	11.29% -
Accounts sent:	1	7	26	3	34	66
Brought current: In mo. 1 at agency In mo. 2 In mo. 3 In mos. 4+	100% 100% 0% 0% 0%	14.29% 0% 14.29% 0% 0%	15.38% 15.38% 0% 0% 0%	33.33% 33.33% 0% 0% 0%	23.53% 17.65% 5.88% 0% 0%	19.7% 15.15% 3.03% 0% 1.52%

* Actual remittance may be lower due to recovery of Prosper borrower fees by collection agencies.

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