A group of online consumer loans that were packaged into bondsis going bad faster than lenders and bond underwriters hadexpected, the latest sign that some startups that aimed torevolutionize the banking industry underestimated the risk theywere taking.

Delinquencies and defaults are reaching key levels known as“triggers” for at least four different sets of bonds. Breachingthose levels will force lenders or underwriters to startpaying down the bonds early. Avant Inc. and its underwriters, forexample, are going to have to begin to repay three of itsasset-backed notes, according to a person with knowledge of thematter.

Two of Avant's securities breached triggers this month for thefirst time, the person said, asking for anonymity because the datais not public. Another bond, tied to the subprime lender CircleBackLending Inc., may also soon breach those levels, according toMorgan Stanley analysts. When the four offerings wereoriginally sold last year, they totaled more than $500 million insize. Around $2.8 billion of bonds backed by online consumer loanswere sold in 2015, according to research firm PeerIQ.