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Messages - storm

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Investors - LC /
« on: November 22, 2020, 12:00:00 AM »
Investors - LC / Post-News IRA Strategy
« on: October 07, 2020, 11:00:00 PM »
I just closed out my LC IRA, but if I still had it, I would look at my returns minus the annual fee versus paying income tax on an early withdrawal and transferring the notes to a taxable LC account. Normally there is a 10% IRS penalty for early withdrawal, but there are several additional exceptions this year due to Covid. You can also give up your notes, but I don't think that qualifies as a capital loss when it's inside an IRA. If it was a Roth IRA, then I wouldn't have to worry about taxes.

Strata charges a lot of miscellaneous fees that ate into the relatively small amount of money I had invested, so it was not worth continuing to do business with them. If I was more wealthy and wanted to put the money in more exotic investments, it might be worthwhile to stick with Strata. There are many brokerages that no longer charge fees or commissions, so it was just a no-brainer to transfer the funds to one of them. Just my 2 cents.
Investors - LC / Lending Club potential new offerings
« on: August 27, 2020, 11:00:00 PM »
I was not targeted by this survey.

I hate to be a Debbie Downer, but LC has neglected its retail investors for years (website hasn't been updated, secondary marketplace shut down, poor loan availability and underwriting, etc.). I just don't see myself reinvesting in the LC ecosystem without some giant incentive. How can LC compete with an index fund or ETF from one of the many discount brokerages with no commissions? Considering we have double-digit unemployment in this country right now, I just don't think it is wise to invest in consumer lending either.
Investors - LC / Folio ending August 28th.
« on: August 08, 2020, 11:00:00 PM »
I've spent the better part of this year slowly and strategically liquidating my remaining notes in my IRA before the annual fee hits me later this year. I'm down to just a handful of notes with terrible payment histories. I consider myself lucky. I feel sorry for anyone who wants out now.
I did a partial transfer in May.  Within my LC account, I withdrew the funds to Strata.  I filled out the transfer forms on Vanguard's website, printed them out, and mailed them off without being notarized.  About a week later, Strata said they mailed the check to Vanguard.  Vanguard shows they received it a week later, and then it was another week before the funds were available for investing.  Took about a month in all.  Fee for partial transfer was $25.  Not sure how that affects taxes.  I'm thinking it probably won't.
Investors - LC / Tax treatment of lending club
« on: May 29, 2019, 11:00:00 PM »
I think you have a good grip on how LC is taxed.  Some things to think about:

  • If you have a lot invested, the interest income can bump you into a higher tax bracket.
  • If you have a lot invested and since LC does not withhold taxes, you can be in for a nasty surprise come tax season unless you adjust your W-4.
  • If you invested in stocks/mutual funds/real estate instead and held on to it for over a year, you have the advantage of them being taxed at the more favorable long-term capital gains rate.
  • I think the unhappiness really stems from a combination of having a large amount of write-offs (bad loans), little to no capital gains to offset, and having to roll over the losses into another year because of the $3k cap.
Investors - LC / 1099 Spreadsheet for Accountant
« on: December 31, 1969, 07:00:00 PM »
LC lets you download your tax forms in PDF or XLS format.  XLS is Excel format.  You might supply both to your accountant and let them use whatever they prefer.  Neither require a password to open.
Foliofn - LC / investor fee
« on: December 31, 1969, 07:00:00 PM »
1% fee is taken from all borrower payments no matter how you acquired the note.
Foliofn - LC / loan/note availability, calculating return, newbie questions
« on: December 31, 1969, 07:00:00 PM »
I hate to sound like a Debbie Downer, but the retail marketplace is on the decline.  We make up 7% of LC's business now and falling.

This forum used to be much more active, but LC got greedy and sold investors a bunch of bad loans in the last few years.  Many of us old timers have or are in the process of winding down our portfolios because of the lackluster returns and unfavorable tax treatment.  My returns have been looking a little better the last few months despite no new investments, but only time will tell if LC can be trusted again.

FolioFN is strictly a take it or leave it marketplace.  No bidding.

For calculating returns, the XIRR function in spreadsheet software (Excel, Google Sheets, etc.) is probably the best method.  Peter has a blog entry about it here:
Investors - LC / Is LC no longer interested in retail investors?
« on: December 31, 1969, 07:00:00 PM »
From the latest available SEC filings, 7% of loan origination funding came from self-directed/retail investors and falling. (source:  LC hasn't cared about the retail investor in a long time, IMHO.  CD rates are very close to outpacing my LC returns, and it just isn't worth my time hunting down new loans to invest my idle cash.  There was a time when I really liked the steady returns and security of this investment and told everyone I knew about it.  I wish I could find something similar where they gave a crap.
Investors - LC / New Platform
« on: December 31, 1969, 07:00:00 PM »
@kib If anyone important at LC is reading this thread, I think you made your point brilliantly.   ;D
Investors - LC / Higher Interest Rates
« on: June 28, 2018, 11:00:00 PM »
Just got a new e-mail from LC.  This is a bit of good news for those of us who are still investing:

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