My Lending Club Account Performance Update 5
Here is another update of my Lending Club Account Performance. The last update was on September 1, 2010, over 9 months ago.
Since I opened my account in August 2009, I’ve earned a total of $5,497.60 in interest; however, this includes about $1,000 with signup bonuses.
Since my last update, Lending Club enticed me to add additional $20,000 to my account for a $400 bonus for in immediate 2% return. So my initial investment is now $50,000.
Now of the negative news; I currently have 5 notes late 16-20 days and 12 notes late 31-120 days at a potential loss of $363 and $706, respectively. To date I’ve lost $1,088 due to loan charge off (borrowers not paying off loan) but an additional $1,000 loss maybe coming in the near future due to late payments. Currently, the majority of losses are due to B and C investors with only one A investor.
To combat future late payments and defaults, I’ve continued to reinvested monies with A investors at $25 to $50 per note. This should lower future risk; however, my rate of return will continue to drop.
One area of improvement on my end is picking better notes to invest in. This will lower default and increase rate of return. After filtering notes, I invest in every note without reading each note requirement and even asking questions of the borrower to determine risk.
I currently have $3,000 in funding notes at $50 each in all A borrowers. I have an available $7,758.89 in cash that I will invest over the next several weeks. The cash available is from loan payoffs that I haven’t re-invested.
See screenshot below of my account.
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6:19 pm on September 11th, 2011
SO, would you do it all over again? Is the 7.78% annualized return worth the time spent and additional worry over the “C” players? I don’t where I can get 7.78%. You mentioned a 3- and 5-year term – do you commit your money for a certain duration?
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1:17 pm on September 12th, 2011
Yes, I would do it again and plan to keep doing it. I don’t worry about the C players because I only invest in A and B borrowers. Currently, I only invest in 3 year term notes. However, you can sell your note if you don’t want to wait until 3 years. Keep in mind that you are getting your money back every month over the length of the note.
7:23 pm on November 9th, 2011
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