Prosper.com Risk Analysis

The graphs below come from data extracted from LendingStats. I wanted to do a more in-depth analysis based on historical data (current as of today) of the risks associated with different parameters, i.e. how can I minimize the potential for delinquent payments and defaults down the road when I choose a listing to bid on. Some results are expected, but some surprises have come up, too. I know the graphs' text is small. Click on the pictures for a larger version.

This is pretty obvious. Risk jumps quite a bit between D and E. I personally avoid anything lower than C nowadays, but maybe I should consider D's, too.

Here's a surprise: risk is actually highest with lower debt/income ratios. Does having some debt = developing responsibility?
70-ANY includes a lot of self-employed people since they can't include their income in the Prosper debt/income formula, so they have astronomical ratios. Still very feasible investments, though, as shown above.

Another surprise for me: delinquency rate is higher when the loan amount is low. Maybe a small loan is easier to overlook, like dollar bills versus Benjamins. Maybe people who borrow more are more able to pay them off, and lenders are more likely to lend a larger amount to them.

Definitely only lend to people who verify their bank accounts. Honestly, anyone can open a no-minimum bank account today, so if they don't have one, something's fishy.

The risk is almot twice as high to lend to non-home owners. But the absolute difference isn't actually that great. Personally, this isn't one of the criteria that I'm really concerned about.

Automatic funding is where the listing closes as soon as enough funding is submitted by bidders. This result makes sense since people who can't afford to wait for the interest rate to get bid down further are more likely to already be in financial trouble.