Frequently Asked Questions (General)
Answers
What is People Capital?
People Capital is a student lending organization that uses an auction-based, peer-lending platform to match students with college funding sources.
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How is People Capital regulated?
As a consumer lender, People Capital adheres to both state and federal regulations including, but not limited to, the
,
,
,
,
,
the (as amended and
reauthorized) and other laws and regulations regarding privacy, fair business practices and data security.
People Capital lends money only in states where it either has a valid license or is not required to have one under state law.
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In which States is People Capital currently lending?
People Capital is currently loans in the following states:
- Alaska
- Arkansas
- Colorado
- Connecticut
- Florida
- Georgia
- Hawaii
- Iowa
- Kansas
- Louisiana
- Massachusetts
- Maine
- Minnesota
- Mississippi
- Nebraska
- North Dakota
- New Hampshire
- New York
- Nevada
- Oregon
- South Carolina
- Virginia
- Washington
- West Virginia
- Wisconsin
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What types of loans are available on the platform?
We private student loans to students at accredited institutions that
are qualified. Private Student Loans
are available for students enrolled (at least half-time) in degree programs and can only be used to pay for educational expenses, such as tuition and fees, room and board, books, school supplies, and transportation.
These loans may be - or
loans, and have or
payments.
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What is so special about "private student loans"?
Loans that qualify for private student loan status provide additional benefits to and
alike.
For borrowers, the loan interest payments may be tax deductible (though they will need to file a
form to get the tax deduction). For lenders, these
loans are generally not dischargeable in bankruptcy.
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How is People Capital affected by changes to the Federal Student Loan Program?
Until recently, the majority of Federal loans were made by private entities (e.g. Sallie Mae, Citibank, Nelnet and thousands of Banks) but were “guaranteed” by Federal
guarantors and the Federal government. The Federal Student Loan Program also offers Federal student loans that are originated and "guaranteed" by the government
(often referred to as The Federal Direct Student Loan Program). There is currently pending Legislation which may eliminate the Federal Student Loan program
which banks participate in. This would mandate that 100% of Federal student loans go through the Direct Lending Program.
These recent changes do not affect the amount of funding available, rather the process under which the loans are made. Under either structure these “federal loans”
remain separate from the “private student loans” originated by the People Capital platform and People Capital encourages borrowers to maximize Federal
funding before considering a Private loan.
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What are the special features of the People Capital platform?
Credit risk assessments, as generated by the , underpin our peer-to-peer lending
platform. Built on rigorous academic research by leading labor economists, the uses academic information and merit data such as GPA, standardized test scores, college and major to provide an unbiased ranking and projection of the future economic value of an education.
Our platform allows lenders and sophisticated risk managers to search, filter and match borrowers on a variety of human capital, financial and educational metrics. Lenders can create a unique portfolio of individually selected student loans.
These loans feature all the benefits and rights of "private education loans" as set forth in
the
(as amended and reauthorized). We are also dedicated to providing a full range of features that are unique to
the student loan arena, such as enrollment verifications, disbursements directly to schools, etc.
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How does the transaction work?
Lenders can buy ("Notes") issued by an affiliate of People Capital to
under a
("PPM"). The proceeds of each series of Notes are designated by the lenders who purchase them for funding a corresponding loan ( through our platform to a student borrower). Each series of Notes will have a stated interest rate. Any principal and interest payments you will receive on any Note will be limited to an amount equal to your pro rata portion of the loan payments net of any service charge and/or fees. The Notes are special, limited obligations of
an affiliate of People Capital only and not the borrower members. Each Note is
fully secured by the corresponding member loans or related pro rata portion
thereof.
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How is my personal information protected?
People Capital follows practices of the financial security industry in safeguarding data and your personal information and is also
. All our data is stored on several hosted servers segregated by firewalls and housed in secure facilities with 24/7 monitoring. Data transmission is encrypted using SSL version 3.
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Do you sell or rent my information to anyone for the purposes of marketing?
No. People Capital does not sell or rent any of your information to any third parties for marketing purposes.
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Who services the loans?
People Capital retains all rights and responsibilities associated with the servicing and collection all loans on the website.
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How does People Capital make money?
People Capital charges borrowers an application fee, as well as an origination fee at the time the loan is . We charge lenders a servicing fee for the servicing and collection of the loans.
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Does People Capital guarantee that borrowers will pay loans?
No. Neither People Capital nor its affiliates guarantees that any loan payments will be made by borrowers.
People Capital acts solely as the loan facilitator, originator and servicer. All loans are unsecured — much like a traditional credit card. As such, there is risk involved in lending. Therefore, People Capital suggests that lenders search out borrowers with profiles and backgrounds that will be in line with the amount of risk they are willing to take. We also suggest that lenders diversify bids by making many smaller bids instead of a few large ones.
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Are lending accounts insured by the FDIC?
Yes. People Capital keeps lender money in a designated FBO account and manages it in accordance to the FDIC. As a result, each lender's account is insured against loss for up to $250,000 per current FDIC rules and regulations.
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