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Lending Club or other peer to peer lending as an investment
Posted on 12/9/14 at 12:53 pm
Posted on 12/9/14 at 12:53 pm
Has anyone invested in any of these?
Returns look great, but I'm also reading that institutions are cherry picking the best loans...they advertise 7-9% return after expenses and defaults depending on risk profile.
Returns look great, but I'm also reading that institutions are cherry picking the best loans...they advertise 7-9% return after expenses and defaults depending on risk profile.
4
Posted on 12/9/14 at 12:54 pm to Ole War Skule
Depending on risk profile is the key phrase there
Posted on 12/9/14 at 1:12 pm to Ole War Skule
I have about $2500 in it. I make about 8% but I am very conservative. Have only had two $25-$50 loans default, both were high risk.
Each loan is usually 3-5 years. There are some people that try to minimize their risk by loading up on the high risk loans for a couple months then sell them off to the people that take the hit. But its a good 8% return if you spread everything out.
Each loan is usually 3-5 years. There are some people that try to minimize their risk by loading up on the high risk loans for a couple months then sell them off to the people that take the hit. But its a good 8% return if you spread everything out.
This post was edited on 12/9/14 at 1:14 pm
Posted on 12/9/14 at 1:38 pm to Thib-a-doe Tiger
quote:
Depending on risk profile is the key phrase there
Returns are after expenses and defaults.
I'm reading many doing significantly better than above with higher risk/rate loans.
There are a number of paid services which filter based on proprietary systems which get double digit returns.
I haven't read a negative review yet, but am sure there's got to be some downside.
Posted on 12/9/14 at 1:39 pm to anc
quote:
then sell them off to the people that take the hit.
are they usually sold at face, discount, or premium?
Posted on 12/9/14 at 2:03 pm to Ole War Skule
quote:
are they usually sold at face, discount, or premium?
Discount.
What I usually look for is the 680 credit score that has high CC debt. Never missed a payment, but a consolidation loan would amortize his credit cared payments and give him a lower credit score. I've never had a default on one of these - this is my go to.
The 750 credit score that has little to no credit card debt that wants to borrow $20k to open a restaurant/salon whatever is where your defaults typically come from.
Posted on 12/9/14 at 2:03 pm to Ole War Skule
The institutional platform is seperate from the retail platform, so that is just people talking.
My high risk portfolio is returning 14.6% net of fees and expected losses. 16.2% net of only fees and actual losses. My conservative portfolio is at 9.2% net of both.
From a risk to reward profile, those notes are great, assuming you diversify.
My high risk portfolio is returning 14.6% net of fees and expected losses. 16.2% net of only fees and actual losses. My conservative portfolio is at 9.2% net of both.
From a risk to reward profile, those notes are great, assuming you diversify.
This post was edited on 12/9/14 at 2:04 pm
Posted on 12/9/14 at 2:08 pm to TheHiddenFlask
quote:
The institutional platform is seperate from the retail platform, so that is just people talking.
My high risk portfolio is returning 14.6% net of fees and expected losses. 16.2% net of only fees and actual losses. My conservative portfolio is at 9.2% net of both.
From a risk to reward profile, those notes are great, assuming you diversify.
i learned about it here, I have done about 7% in 9 months in my conservative portfolio.
Next bonus I am putting more in.
Posted on 12/9/14 at 3:07 pm to Hawkeye95
thanks to everyone for the info. I'm going to see what it would take to move an IRA over. The only problem I see is the non-capital gains issue of the income.
has anyone used any of the paid filtering services?
also, seems Prosper is getting slightly better reviews than Lending Club. anyone have any opinions about specific sites, good or bad?
has anyone used any of the paid filtering services?
also, seems Prosper is getting slightly better reviews than Lending Club. anyone have any opinions about specific sites, good or bad?
This post was edited on 12/9/14 at 3:09 pm
Posted on 12/9/14 at 3:43 pm to Ole War Skule
Starting an IRA took a few weeks, but was easy.
Filtering will pick up basis points. Unless you are putting in hundreds of thousands, probably a bad ROI.
Lendingclub has a slightly better approval process, so I assume prosper is just getting some hipster appeal because they were doing peer to peer before it was cool.
Filtering will pick up basis points. Unless you are putting in hundreds of thousands, probably a bad ROI.
Lendingclub has a slightly better approval process, so I assume prosper is just getting some hipster appeal because they were doing peer to peer before it was cool.
Posted on 12/9/14 at 10:09 pm to Ole War Skule
Yes. I've used lending club. Made good returns. Had a few defaults. Still came out way ahead by diversifying who I loaned money to. I prefer making private loans secured by real estate though. Remember lending club is unsecured.
Posted on 12/9/14 at 10:37 pm to Fat Bastard
I lost money in the original Prosper. I didn't invest once they changed their format. I think it is probably ok.
Posted on 12/11/14 at 1:36 pm to I B Freeman
Yep. Original prosper went under or was shut down.
Posted on 12/11/14 at 3:45 pm to Fat Bastard
I occasionally look for private investors for real estate deals. Should we talk further?
Posted on 12/12/14 at 4:48 pm to Prince or Pauper
quote:
I occasionally look for private investors for real estate deals. Should we talk further?
I only use one firm/organization for my private money lending secured by Real Estate.
However,
I'm currently looking at some deals which include a percentage of a hotel and/or apartment complex. I'm looking to expand from my SFH investments.
What type of real estate do you buy?
Posted on 12/15/14 at 2:20 pm to Fat Bastard
I am open to whatever good deal I come across. Typically that is a SFH, but I do occasionally work with commercial properties and smaller complexes. If you would like to diversify your lending, we might be able to help.
Posted on 1/10/15 at 11:14 am to anc
I am thinking about investing in the Lending Club. I saw that LC gets 1%. Quick question for example when I am browsing the loans it shows that the loans are 7% or whatever number. Is the posted interest rate before or after the LC getting their %. Thanks.
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