SAN FRANCISCO, Nov. 30, 2021 /PRNewswire/ -- LendingClub Corporation (NYSE: LC), the parent company of LendingClub Bank, America's leading digital marketplace bank, today announced that its auto refinance loans are now available in 40 states, covering 94 percent of the U.S. population, and borrowers have saved an average of $4,000 over the life of the loan. The product was first launched in California in 2016.
Auto loans represent the fourth-highest share of U.S. household debt, after mortgage debt, home equity line of credit, and student loan debt, with Americans owing more than $1 trillion on their auto loans. Nearly two-thirds of LendingClub's members currently hold an auto loan and it is usually their second highest monthly debt outside of housing costs. The average APR for borrowers on auto refinance loans through LendingClub Bank are nearly 5 percent lower than their previous loans. This translates into an average savings of more than $4,000 over the life of the loan.
Before scaling its auto refinance offerings, LendingClub focused its efforts on creating a best-in-class customer experience that has already set a new bar in the industry. The application process can now be completed in less than a few minutes and the time to complete a loan has been reduced to three days compared to several weeks for other lenders.
"We see auto refinance loans as an enormous opportunity for our 3.8 million members and for LendingClub. Who would not want to save thousands for just a few minutes work?" said Todd Denbo, SVP of Auto at LendingClub Bank. "Now that we've transformed the process for refinancing an auto loan and can sell loans through our marketplace as well as hold loans on our balance sheet, we're scaling the product. Auto is a key step in our vision to create a holistic customer experience that seamlessly integrates saving opportunities for our members across our product offerings."
LendingClub spent 15 years building the nation's leading personal loans business – gathering deep data insights, dialing in the customer experience, improving credit models, building industry relationships, enhancing control and compliance capabilities, and more. As a digital marketplace bank with the ability to both hold loans on its balance sheet and sell loans on the marketplace, LendingClub Bank can now bring more of this expertise to other financial pain points that its members face, such as refinancing auto loans.
Unlike new entrants, LendingClub's auto refinance products are informed by the billions of dollars in personal loans to millions of customers through a range of credit scenarios, enhanced by rigorous testing and resulting in 150+ billion data cells added to its proprietary database. This rich data set has guided LendingClub's predictive science and credit decisioning algorithms to outperform the market. For example, delinquency rates are more than 35 percent better than the average for its personal loan business.
In addition to the incredible opportunities for members, LendingClub has also created a compelling case for its marketplace investors to finance these auto refinance loans. Auto loans were the top performing asset through the 2008 recession and their durability was evident again during the pandemic. LendingClub has also over-delivered on credit performance for its investors. The combination of the resiliency of auto loans through business cycles and our strong loan performance has driven investor demand for our auto refinance loans.
To make it easy for borrowers to work out how much they can save, LendingClub has also released an auto refinance calculator: https://www.lendingclub.com/loans/auto-refinancing/refinance-calculator