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Posted: 6/10/2017 11:11:56 AM EDT
I started a lending club account about a year ago after reading about it on here. I started with the $2500 suggested investment to diversify for the most average returns.
So far my cash in deposits are $4250 and I add $100 a month to it. I am currently sitting at $459.23 in interest paid, and reinvested. On a no chargeoff month profit is between $40-50. I am waiting for another solid month to get a new number but I expect things to change a bit with my new strategy. If I start all over from the beginning I would do it very differently. Their trading platform for notes is looked at as a way to sell of notes and it can be if you have good notes. Currently the trading platform is the only place I buy notes. This is how I set to shop notes: 15%-31% rate 60 month loan term only Issued, current, never late loan status 1-25 remaining payments 650 to 850 credit score 100% to 0% markup/discount This method seems to be about the safest bet. You're buying a note that 25/60 payments left so they are likely to pay off and are way past the most common defaul months. With it being a safer bet you can also aim for the higher rate notes to buy. Any questions? I will try to answer to the best of my amateur investor ability. 
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Posted: 6/10/2017 11:14:35 AM EDT
[#1]
Following this for info.
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Posted: 6/10/2017 11:18:24 AM EDT
[#2]
I turned off my auto invest and get to wait a few years to get my money back. I've tried to sell notes and short of a heavy discount they never moved. These were good notes too. The risk/reward factor doesn't overcome the liquidity issues for me. Thankfully I don't have much tied up in it.
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Posted: 6/10/2017 11:45:52 AM EDT
[#3]
Quote HistoryQuoted:
I turned off my auto invest and get to wait a few years to get my money back. I've tried to sell notes and short of a heavy discount they never moved. These were good notes too. The risk/reward factor doesn't overcome the liquidity issues for me. Thankfully I don't have much tied up in it. However if you done auto invest and go to the trading market you will be only buying hand picked notes that have, depending on your choice, 25 months of payments left. 2 years or less and you get the return and you have quality stable notes that are more likely to sell on the market of you decide to sell off. |
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Posted: 6/10/2017 12:35:13 PM EDT
[#4]
Tag for interest.
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Posted: 6/10/2017 1:08:38 PM EDT
[#5]
Is the like PTP loans?
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Posted: 6/10/2017 1:22:29 PM EDT
[#6]
Quote HistoryQuoted:
Is the like PTP loans? |
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Posted: 6/10/2017 2:03:27 PM EDT
[#7]
Quote HistoryQuoted:
I turned off my auto invest and get to wait a few years to get my money back. I've tried to sell notes and short of a heavy discount they never moved. These were good notes too. The risk/reward factor doesn't overcome the liquidity issues for me. Thankfully I don't have much tied up in it. |
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Posted: 6/10/2017 10:39:15 PM EDT
[#8]
Quote HistoryQuoted:
I looked into this at one point and I thought it was a nogo in Texas. Will look at it again. |
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Posted: 6/11/2017 10:31:08 PM EDT
[#9]
Unless things have changed, I saw you guys making 6-7% with no liquidity.
Are the yields higher how? |
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Posted: 6/11/2017 11:01:04 PM EDT
[#10]
Quote HistoryQuoted:
Unless things have changed, I saw you guys making 6-7% with no liquidity. Are the yields higher how? |
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Posted: 6/11/2017 11:45:22 PM EDT
[#11]
Quote HistoryQuoted:
Right at 8% when I checked my account yesterday. Quote HistoryQuoted:
Quoted:
Unless things have changed, I saw you guys making 6-7% with no liquidity. Are the yields higher how? |
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Posted: 6/11/2017 11:49:03 PM EDT
[#12]
Do they allow you to buy and sell your loans?
Or once you make a loan, you have to hold until paid off? |
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Posted: 6/12/2017 2:59:37 AM EDT
[#13]
Quote HistoryQuoted:
Do they allow you to buy and sell your loans? Or once you make a loan, you have to hold until paid off? Yes, you hold the note until its paid off. Each month you get your share of the loan P&I. A note is basically a fractional representation of any given loan done on LC. |
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Posted: 6/12/2017 11:15:20 AM EDT
[#14]
Quote HistoryQuoted:
Unless things have changed, I saw you guys making 6-7% with no liquidity. Are the yields higher how? My traded notes are at 15.93% This is why I have changed how I buy notes. The notes I buy are solid and have a much better chance to sell if I choose to. New or young notes are too risky. I currently have 275 note 230 current 5 in Grace period 30 paid off 4 that are 31 to 120 days late 1 default 5 charged off |
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Posted: 6/12/2017 11:36:51 AM EDT
[#15]
Quote HistoryQuoted:
My original 100 plus notes are at 6.82% My traded notes are at 15.93% This is why I have changed how I buy notes. The notes I buy are solid and have a much better chance to sell if I choose to. New or young notes are too risky. I currently have 275 note 230 current 5 in Grace period 30 paid off 4 that are 31 to 120 days late 1 default 5 charged off Quote HistoryQuoted:
Quoted:
Unless things have changed, I saw you guys making 6-7% with no liquidity. Are the yields higher how? My traded notes are at 15.93% This is why I have changed how I buy notes. The notes I buy are solid and have a much better chance to sell if I choose to. New or young notes are too risky. I currently have 275 note 230 current 5 in Grace period 30 paid off 4 that are 31 to 120 days late 1 default 5 charged off |
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Posted: 6/12/2017 12:04:29 PM EDT
[#16]
Tagged for a new investment strategy. Been in since 2011 and just over a 6% return
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Posted: 6/12/2017 12:20:36 PM EDT
[#17]
Mainly using their calculations.
I haven't done it manually yet to double check it.  Attached File Attached File |
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Posted: 6/12/2017 1:11:28 PM EDT
[#18]
I dunno how this strategy is going to work out for you. I've had A grade loans that have only made one payment then defaulted, and had ones that only had one payment left and defaulted. 60 month notes are notoriously bad.
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Posted: 6/12/2017 1:23:00 PM EDT
[#19]
Quote HistoryQuoted:
I dunno how this strategy is going to work out for you. I've had A grade loans that have only made one payment then defaulted, and had ones that only had one payment left and defaulted. 60 month notes are notoriously bad. You can view their pay history and buy in at a 25 month or less remaining note. I agree. The grades are bogus. Lots of A grades will default. That's why I never look at the grade. Any note can default and they are higher risk of it over the first 25% of their loan term. Then it reduces as it gets older. |
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Posted: 6/12/2017 1:29:20 PM EDT
[#20]
What kind of fees/charges are associated with the trading platform?
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Posted: 6/12/2017 1:39:48 PM EDT
[#21]
Quote HistoryQuoted:
What kind of fees/charges are associated with the trading platform? As the seller you can set a discount or markup to your liking but I won't buy anything with a markup. There are some nice discounts out there too. |
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Posted: 6/13/2017 9:59:03 AM EDT
[#22]
Here is a look at what I see when buying notes on the trading platform. At $10 to $15 a note instead of the $25 I can buy more notes and be even more diverse in my investment and spread out risk even more.
And if they do default I lose less than buying notes at their origination. How I filter  Attached FileThe results.  Attached File |
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Posted: 6/13/2017 10:34:40 AM EDT
[#23]
Wow, so these people were borrowing $25?
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Posted: 6/13/2017 12:07:17 PM EDT
[#24]
Quote HistoryQuoted:
Wow, so these people were borrowing $25? In rough up. A $25,000 loan could be funded by 1000 different people. |
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Posted: 6/13/2017 1:26:41 PM EDT
[#25]
Quote HistoryQuoted:
The loan could be for any amount. The amount of the loan you decide to purchase is up to you. The most common note size is $25 because that is the lease you can buy into a note at the origination. In rough up. A $25,000 loan could be funded by 1000 different people. ETA: I see now that a couple have the same lone ID - I take it those are both portions of the same loan. |
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Posted: 6/13/2017 5:38:30 PM EDT
[#26]
I dipped my toes in the water at the beginning of the year. I did a lot of research first and I think I have a pretty good filter. Since I've been investing in LC, I already have 7 loans paid off. 2 from January, 2 from April and 3 from May! Very weird that someone would get a loan and pay it off a month later. I had one loan go into 15-30 late period, but then it got caught up. I have the auto invest feature set up so it'll pick up a new loan when I have $25 in cash. I'm not adding new money for a while since I have a few other financial obligations to deal with. I'll see how things look in the next 12-18 months.
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Posted: 6/13/2017 6:26:02 PM EDT
[#27]
Quote HistoryQuoted:
I dipped my toes in the water at the beginning of the year. I did a lot of research first and I think I have a pretty good filter. Since I've been investing in LC, I already have 7 loans paid off. 2 from January, 2 from April and 3 from May! Very weird that someone would get a loan and pay it off a month later. I had one loan go into 15-30 late period, but then it got caught up. I have the auto invest feature set up so it'll pick up a new loan when I have $25 in cash. I'm not adding new money for a while since I have a few other financial obligations to deal with. I'll see how things look in the next 12-18 months. |
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Posted: 6/14/2017 1:47:44 AM EDT
[#28]
Quote HistoryQuoted:
Mind sharing your rules? .
My Rules: Grade: C or D Location State: No CA or NY Accounts Now Delinquent: 0 Delinquencies Last 2 years: 0 Loan Purpose: Refinancing credit card, consolidating debt, wedding expenses, major purchase Earliest credit line: 10 years or more Max Debt-to-income: 20% Loan Term: 36 months Max Loan Amount Up To: $25000 Major Derogatory: >60 Exclude Relisted: (box checked) Min Length of Employment: 4 years Home Ownership: Mortgage or Own Inquiries in the last 6 months: 0 |
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Posted: 6/14/2017 7:43:08 AM EDT
[#29]
Quote HistoryQuoted:
Sure. I must say, investing any money can be a chore. When I do a deposit, I need to manually attempt to invest right when the loans post. Sometimes they fill 100% before I can complete the transaction .
My Rules: Grade: C or D Location State: No CA or NY Accounts Now Delinquent: 0 Delinquencies Last 2 years: 0 Loan Purpose: Refinancing credit card, consolidating debt, wedding expenses, major purchase Earliest credit line: 10 years or more Max Debt-to-income: 20% Loan Term: 36 months Max Loan Amount Up To: $25000 Major Derogatory: >60 Exclude Relisted: (box checked) Min Length of Employment: 4 years Home Ownership: Mortgage or Own Inquiries in the last 6 months: 0 |
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Posted: 6/14/2017 8:45:36 AM EDT
[#30]
Quote HistoryQuoted:
Those are some pretty stiff rules for those loan grades, must be kind of hard to fill. What is the minimum credit score you will accept? What kind of returns are you getting? |
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Posted: 6/15/2017 10:38:55 AM EDT
[#31]
I did it for a year and I am beginning to pull my money out. I made money, but the returns just do not justify the illiquid nature of the investment.
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Posted: 6/17/2017 5:59:31 PM EDT
[#32]
I need to look at my account. I have not done so in many months. I just have it set up on auto reinvest.
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Posted: 6/17/2017 6:03:29 PM EDT
[#33]
What's your exit strategy for when the market collapses and you now have exposure to a bunch of risky notes?
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Posted: 6/18/2017 11:59:11 PM EDT
[#34]
I have none. These are loans to individuals - no more than $25 to any one person. I feel this is about as diversified risk as one can get. The average person borrowing money on lending club likely is not hugely impacted by market forces. They are average joes punching a clock. Sure in a huge market collapse they might lose jobs but in that scenario what investment is safe? I have around 11k invested in there with loans to over 400 people. Suzie teacher who borrowed 5k to consolidate her credit cards doesn't give a rip what the market does nor does Joe the mechanic that works at the local tire shop.
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Posted: 6/24/2017 10:05:23 AM EDT
[#35]
Quote HistoryQuoted:
I have none. These are loans to individuals - no more than $25 to any one person. I feel this is about as diversified risk as one can get. I look at it this way. I'm one year in. I put in the $2500 min to meet the recommended diversity. Right now. A yeah and a month later I have been paid back $2206. With $484 of that being interest. My notes bought on the trading market at one month in have seen $57.20 in payments and $10.12 on that is interest. With $662.06 in invested principal so far. My weighted average rate is 18.96% and none of the accounts have been past due at all yet. After working in title lending for a few years I know my risk here and I know it's worth it. |
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Posted: 6/25/2017 11:11:56 PM EDT
[#36]
Quote HistoryQuoted:
After working in title lending for a few years I know my risk here and I know it's worth it. |
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Posted: 6/25/2017 11:17:47 PM EDT
[#37]
OST
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Posted: 6/26/2017 8:50:25 AM EDT
[#38]
Quote HistoryQuoted:
Are there other criteria you are looking at to pick these high risk loans and get winners? Profession? Length of employment? I buy notes that haven't been late and have made a lot of payments. Current payment history on loans seems to show a better trend than everything else. Investing half the cash for half the time with half the pay history already known is a great thing. |
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Posted: 6/28/2017 1:02:18 PM EDT
[#39]
I think your onto something, in the other thread others were not happy with how liquid the investments are and for those of us who are willing to wait on them it provides us an opportunity for us to buy them at the original owners loss, which is instant profit.
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Posted: 7/3/2017 11:46:27 AM EDT
[#40]
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Posted: 7/3/2017 12:08:20 PM EDT
[#41]
Quote HistoryQuoted:
I think your onto something, in the other thread others were not happy with how liquid the investments are and for those of us who are willing to wait on them it provides us an opportunity for us to buy them at the original owners loss, which is instant profit. |
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Posted: 7/4/2017 11:28:32 PM EDT
[#42]
Maybe I'm reading it wrong, could you explain it to me. It seems like in one of your above photos that the "Principle and Interest" price is very close to the asking price. Is that "Principle and interest" of the whats left of the note? If the asking price is close to that, but still seems to show a discount, aren't you paying the full term to them and making very little money for yourself?
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Posted: 7/5/2017 12:35:11 PM EDT
[#43]
Quote HistoryQuoted:
Maybe I'm reading it wrong, could you explain it to me. It seems like in one of your above photos that the "Principle and Interest" price is very close to the asking price. Is that "Principle and interest" of the whats left of the note? If the asking price is close to that, but still seems to show a discount, aren't you paying the full term to them and making very little money for So? The seller can decide on a markup or discount by %. So if the discount is at 1% and the principal was $10 and interest accrued up to $0.50 total price $10.50. Then discount by 1% and that is the sale price. Where you make money is you still have the remaining term of the loan and any future accrued interest that you profit from. I hope that explained it. If not let me know |
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Posted: 7/5/2017 12:55:24 PM EDT
[#44]
Here is an example of $25 initial investment and looking at the final 20 payments.
$11.51 plus any accrued interest would be your buy in. Your profit would be the interest in the final 20 payments. So you make $2.11 on your investment of $11.51 over the next 20 months of payments.  Attached File |
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Posted: 7/10/2017 2:18:53 PM EDT
[#45]
Is there a networth/income limit to be able to buy the notes on Lending Club?
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Posted: 7/10/2017 2:25:21 PM EDT
[#46]
Quote HistoryQuoted:
Is there a networth/income limit to be able to buy the notes on Lending Club? I think it is up to your honesty. I have a friend that started with just $25 and I know her net worth isn't that much. |
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Posted: 7/25/2017 11:14:25 AM EDT
[#47]
Quote HistoryQuoted:
Is there a networth/income limit to be able to buy the notes on Lending Club? Yes, I know I can't get my money back easily, but then again once I buy one of the scratch off lottery tickets it's gone as well. I've not been contributing much lately other than reinvesting the returns(Principal and Interest) on my investments. Right now It seems I'm bringing in $25 about every 3 weeks which just gets rolled back into my account. Come Jan 1 I'm going to re-evaluate my account and see if I want to continue to invest in 60 month notes or scale back to 36 month and plan an exit strategy. I think my account is approx 2 years old at this point with maybe 70% of the money my own, the rest has been money reinvested. |
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Posted: 7/25/2017 12:53:55 PM EDT
[#48]
Thanks for the replies.
Anyone know how the taxes are handled between issuing notes, and purchasing them? Ie is it the same, or is one better than the other? I assume both are not capital gains though. |
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Posted: 7/25/2017 1:00:54 PM EDT
[#49]
Quote HistoryQuoted:
Thanks for the replies. Anyone know how the taxes are handled between issuing notes, and purchasing them? Ie is it the same, or is one better than the other? I assume both are not capital gains though. |
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Posted: 7/25/2017 1:02:52 PM EDT
[#50]
Sure does. Thanks a bunch
Thanks for the help also, everyone else. |
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