P2P Lending / NFT Lending Forum

https://forum.lendacademy.com/index.php?topic=938.msg6474#msg88888888Quote"> from: MarinBB on April 26, 2013, 08:38:18 PM

https://forum.lendacademy.com/index.php?topic=947.msg5705#msg5705">Quote"> from: GS on April 06, 2013, 09:08:49 PM

https://forum.lendacademy.com/index.php?topic=942.msg5689#msg88888888Quote"> from: Dennis on April 06, 2013, 03:10:29 PM

I have yet to sell any note on Prosper's Folio trade platform.  From what I have read, it is not as actively as the one on LC and you can't sell notes that are late.  What is your experience?  In particular, I would like to know if there is some kind of recurring fee (quarterly or monthly) that they charge for using Prosper's Folio platform.   Thanks, guys.

I have a couple of LC borrowers declaring bankruptcy right after making one or two payments.  And here is one from Prosper:

"I am a good candidate for this loan because I have never filed for bankruptcy, I have never had a tax lien, always pay my taxes and always pay my debts off

Monthly net income: $10k
Monthly expenses: $8,415.00"

This guy filed bankruptcy after making one payment.  If that was not knowingly committing fraud, I don't know what that was.

No sob stories for me as far as this kind of p2p is concerned.  If you really want to invest in people with stories, I suggest microplace.com    I have a small sum invested over there.

I have been with LC for about five months.  I've got two borrowers declaring bankruptcies after they made only 1 payment.  Obviously, they knew that was coming.  For my Prosper account, I haven't sold any notes just yet, but I've been selling a few notes on the LC platform.  I have found that for Prosper loans, repeat borrowers tend to catch up despite being late, so I am a bit more lenient in that regard.  However, because of the lack of such data on LC, I am slightly less tolerant of late payments, although cutting losses early could also mean cutting out good borrowers who might need a little more time. 

Thanks for keeping us posted on this, Peter.  This is a significant development.  It will also put some pressure on LC to implement similar measures to protect the smaller investors, not just those with deep pockets.

https://forum.lendacademy.com/index.php?topic=561.msg2024#msg88888888Quote"> from: Lovinglifestyle on December 26, 2012, 01:19:35 PM

I don't know if my observation is correct.  It seems that the quality of LC loans has dropped lately.  I have noticed more loans with "Last Major Derogatory" coming on their pipeline than before.  And I have not been able to find loans that fit my criteria as quickly as I did in the past.  I was able to find at least 1 or 2 loans using the same criteria just a couple of months ago but now I have to go for days without being able to put any money to work.  (And it seems that there are more 60-month C loans coming on the platform as well.)

Can someone shed some light on this? 

I think it depends on what you mean by "diversification."  If you have 300 notes invested in only 3 grades, say, in A, B, and C at 100 for each grade, I think that kind of diversification suffices.  But if you have 300 notes invested across all 7 grades, A thru G, with a little over 40 notes for each grade, you might not have sufficient diversification, especially for the lower grades where you have higher default rates.   So, it depends.  In the first scenario, I think you can go from $25 to $50 per note after you have invested in a total of 300 or 400 notes, but in the second scenario, you might need more than 500 notes to do that. But if you go from $25 to $50, you should plan to put in twice the size of current capital invested. 

My two cents.

I don't know if this is a mere coincidence or something else is going on.   The pickup in loan volume on Prosper coincides with a loan drought on LC.  I have accounts on both platforms, so it doesn't matter too much to me in that regard.  The borrowers and the loan sizes are different anyway on the two platforms.  So are the risks involved.  Even though the data available doesn't show much of a difference in terms of risks associated with loan sizes--especially for high income earners, I can't help but balk at the idea of loaning $35,000 to folks with F and G grades on LC.  (But I admit I have invested in a tiny number of these loans.) In that respect, I like Prosper better.  But loan quality seems to be generally higher on LC. 

Hi, Peter, I visit your social lending site on a weekly basis and greatly appreciate the work you do for the p2p lending community.  I started investing in Proper loans in May and it's been nearly 4 months now.  (Actually, I opened a Prosper account back in 2007, but fortunately, I didn't put any money in it, since as we all have come to know, Prosper 1.0 didn't fare well.) The returns have been quite good, and I just began putting some money into Lending Club this month to compare the two platforms.  I expect the ROI to come down as the loans mature, so I am quite realistic in that regard.  I look forward to learning more from you and others in the forum.

After having some experience with both Prosper and Lending Club, I realize that for Lending Club the loan sizes tend to be bigger, in fact, so much bigger for the lower grades than those for Prosper.  For E, F, G grades, LC allows a whopping maximum of $35,000 for a period of 5 years, whereas Prosper allows for only $4000 for 3 years in E and HR loans. I use Nickelsteamroller for research and screening. To my surprise, even for the lower grades, the smaller loans (<$10,000) in LC don't necessarily do better than the larger ones.  In fact, they fare worse. It is difficult to convince myself to commit any fund to a $35,000 loan for a period of 5 years, but if data matters at all, I have to go against my own gut feelings.  I have managed to pitch in a tiny portion of the money for a few of loans in the range of $20,000 to $30,000 for the lower grades.   (Are they talking about raising the maximum to $50,000? That's mind-boggling--too much temptation to just run with the money.)

Would Peter and others care to comment on that?  Why would LC let folks with such high risks borrow $35000? Thanks.