We’ve got a couple updates on the social lending front this morning. First, Prosper has entered a quiet period which they note, "Prosper has started a process to register, with the appropriate securities authorities, promissory notes that may be offered and sold to lenders through our site in the future."

During this time Prosper will not accept any new loans but will continue to service the loans that have already been completed. Lending Club just completed this process which took about six months to complete.

I’ve also received some loan numbers from Lending Club on the 10-day period since the quiet period completion. They have signed up 1.072 new lenders and in total have provided just under $2 million in loans. These numbers are higher than before the quiet period began earlier this year.

If you are new to social lending, our three-part social lending series will get you up-to-speed.

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According to an internal AOL email that was forwarded to us, the blog had 14 million page views from 1.3 million unique visitors on Tuesday, when Apple made new Macbook announcements. 6.4 million of those page views were served in one hour. This was the highest traffic day ever for the site.

The full email:Source:TechCrunch

Prosper and other peer-to-peer lenders like Zopa and Lending Club may turn out to be collateral damage from the credit crisis. Yesterday, Prosper suspended new lending in order to register with the S.E.C to create a secondary marketplace for the loans on its site. As recently as Monday, Prosper didn’t think it would have to register as a seller of securities. But the new climate of heightened regulatory oversight in light of the current financial meltdown has changed all of that.

Lending Club previously had to do the same thing and suspend new lending last April . (The S.E.C just gave it the green light to start lending again on Tuesday). Zopa shut down it’s P2P lending site in the U.S. last week.

Even before the increased regulatory scrutiny, P2P lending took a massive hit along with the rest of the financial industry.

Back in April we reported on P2P social lender LendingClub entering a "quiet period" from the SEC. In June Lending Club filed with the SEC for $600 million in notes. Today Lending Club will announce at the Finovate conference in NYC that they have completed the SEC registration process which ends its six-month quiet period. The updated Lending Club website is available again to lenders and borrowers.

Lending Club notes that the average interest rates for a person with good credit will be 12%. They are also launching LendingMatch which provides lenders with loan information to create a well diversified portfolio. Loans becomes notes registered with the SEC and Lending Club is also launching a secondary P2P loan market.

Lending Club is pushing the concept of "people lending to people" and that they aren’t tied into a bank like the other P2P lenders are. To-date Lending Club has originated more than 2,000 loans with a value of over $19 million.

With the current economic situation, will more people turn to P2P lending if denied by their bank or financial institution. Something tells me that today’s announcement from Lending Club comes at the perfect time. Check out my interview with Lending Club CEO Renaud Laplanche.

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I am not an expert in virtual worlds but on the news tonight there was a segment on Second Life which I thought was worth sharing. The NBC news anchor starts by saying, "The Dark Side of the Web…is Second Life". The segment discusses how parents should keep their teenagers away from Second Life because of all of the sex, porn, drugs, and suicide that occurs in the virtual world. I don’t know about you, but growing up in Brooklyn, most of those things happened on a near-daily basis. The doctor in the segment explains that if teenagers participate in an activity online, they are more likely to want to do it in real life.

Again, while I don’t use Second Life, my guess is that you can find these things anywhere online even outside this "dark side" virtual world.

(apologies for the poor video quality)

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Last year we asked a number of startup entrepreneurs to provide their top tips for success. Today "DebtKid" on the LendingClub blog listed 7 mistakes made when he/she was building out his/her startup. Check out the full blog post for all of the details and apparently later this week will come 7 things done right.

Update: Top Dog Ted has a post regarding the mistakes listed below. Ted discusses hiring a friend and the points to consider.

Here’s the 7 things:

1. I Managed People like Michael Scott from “The Office”
2. I Hired My Friends
3. I Budgeted Like Britney Spears: Terribly
4. I Leased A Fancy Office While My Large Basement Went Unused
5. I Raised Money Before I Had Customers
6. I Mixed Business with Pleasure
7. I Assumed Everything Would Go According to Plan

I will get working on the next startup tips ebook. If you would like to participate, send me a note.

In June 2008, Lending Club filed with the SEC for registration of $600 Million in Member Payment Dependent Notes. Lending Club has been in a "quiet period" since April 2008 while working on the registration. Today the DoughRoller blog was able to gather new information on the SEC registration filing.

DoughRoller notes, "In its Amended S-1, LendingClub disclosed that under a new formula, it will also use several other credit markers in calculating interest rates. Specifically, LendingClub will factor in a borrower’s number of open accounts, the number of credit inquiries in the last six months, how much of a borrower’s available credit is used up, and length of credit history." Previously Lending Club used only an applicant’s FICO score, debt-to-income (DTI) ratio, and amount borrowed. This new set of loan criteria should provide a more balanced picture of the applicant for potential lenders. Many times an applicant will apply for a large number of credit cards at once but they won’t show up as tradelines for several months. By viewing current inquiries, a lender can get an idea if the borrower has been out grabbing lots of new credit. 

We will continue to actively monitor the social lending space. Considering the current financial picture, social lending could become even more active than it is currently.

If you are new to the concept of peer-to-peer lending, check out our social lending series. Also check out our exclusive interview with Lending Club CEO Renaud Laplanche.

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We were the first to report on Lending Club’s quiet period on social lending back in April. At that point, Lending Club stopped originating or issuing new loans during the quiet period. If you are new to social lending, our three-part social lending series will get you up-to-speed.

Below is the announcement that Lending Club is making today regarding their moving forward. Here’s my simple take - lenders will buy "notes" and then use the funds from those notes to provide loans to Lending Club members. Since this information is very specific, I’ve decided to post the entire press release below. It’s important to note that Lending Club is still in a quiet period until the filing is effective.

In contrast, social lending competitor Zopa is using insured CDs with their loan products.

Lending Club Files Registration Statement with the SEC

SUNNYVALE, CA - June 20, 2008 – Lending Club announced today that it has filed a registration statement with the Securities and Exchange Commission under the Securities Act of 1933 relating to its social lending platform.

The registration statement seeks to register the offer and sale of up to $600,000,000 in Member Payment Dependent Notes to be issued by Lending Club in a continuous offering following the effective date of the registration statement. The Notes will be issued in series with each series of Notes corresponding to a single consumer loan to a borrower member. Lender members will direct Lending Club to apply the proceeds Lending Club receives from the sale of each series of Notes to fund a particular consumer loan selected by the lender member and originated through the Lending Club platform.

A series of Notes will be issued only if and when the corresponding member loan closes and is funded. Lending Club will have an obligation to make payments of principal and interest on the Notes only to the extent that Lending Club receives payments on the corresponding member loan.  The terms of the Notes, including interest rate and initial maturity, will correspond to the terms of the corresponding member loans but will reflect a four business day lag on payment dates and maturity to allow the platform to confirm payments received on the corresponding member loan.

Lending Club will offer the Notes only through its website directly to lender members.

A registration statement relating to these securities has been filed with the Securities and Exchange Commission but it has not yet become effective. Copies of the Lending Club registration statement can be accessed on the SEC website: http://www.sec.gov/. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities law of any such state.

About Lending Club ™

LendingClub.com is a social lending network headquartered in Sunnyvale, CA.

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Earlier today we wrote about Lending Club and the abrupt change to their lending policy. Basically for the time being they are not allowing any further p2p (peer-to-peer) loans, only loans made directly with them. I am not sure what amount of funds Lending Club has to lend. I have heard back from CEO Renaud Laplanche and he can’t share anything at this time.

I’ve also noticed some commentary from Lending Club lenders across the net. Here are a couple:

• Scott notes that Lending Club is "no longer peer-to-peer lending"
• Jason Crews is annoyed that he wasn’t informed sooner so he could add more funds to his account to allow for more loans

We will continue to monitor the status and report updates as they become available.

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Lending Club has started a process to register, with the appropriate securities authorities, promissory notes that may be offered and sold to lenders through our site […]