How to kick the tyres without causing a panic?
Aug 8, 2017 13:34:45 GMT
dave, cooling_dude, and 8 more like this
Post by am on Aug 8, 2017 13:34:45 GMT
Kicking the tyres on a loan is something I'd want us to continue to do. But there are a couple of problems with the social dynamics of the process.
1) In the gap between an issue being identified and being resolved, people can take counsel from their fears, and a positive feedback loop occur leading to what might be described as a panic.
2) What might be called the McBride effect - en.wikipedia.org/wiki/William_McBride_(doctor) - positive social feedback (encouragement) for identifying a problem with one loan might encourage leaping to negative conclusions about another loan.
These problems can be partly addressed by the platforms. Getting all their ducks in a row about loan details before release short circuits the potential problems. Quick responses to issues raised would also help, but that has the potential downside that responding too quickly might make things worse by introducing errors.
But what can we do on the lender side to avoid taking counsel of our collective fears while still identifying problematical loans?
1) In the gap between an issue being identified and being resolved, people can take counsel from their fears, and a positive feedback loop occur leading to what might be described as a panic.
2) What might be called the McBride effect - en.wikipedia.org/wiki/William_McBride_(doctor) - positive social feedback (encouragement) for identifying a problem with one loan might encourage leaping to negative conclusions about another loan.
These problems can be partly addressed by the platforms. Getting all their ducks in a row about loan details before release short circuits the potential problems. Quick responses to issues raised would also help, but that has the potential downside that responding too quickly might make things worse by introducing errors.
But what can we do on the lender side to avoid taking counsel of our collective fears while still identifying problematical loans?
