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Messages - hoggy1

#46
Foliofn - LC / Yield To Maturity - The Most important?
August 04, 2014, 11:00:00 PM
My recommendation is you stop for the moment. I really don't mean to insult you and I have gone to some trouble to help you answer your question. I can tell from your question you do not understand compound interest and discounted revenue streams well enough to be putting your money in this type of investment.  Look at this loan for sale on Folio:
 
https://www.lendingclub.com/foliofn/browseNotesLoanPerf.action?showfoliofn=true&loan_id=7731130&order_id=27161773&note_id=32136061" class="bbc_link" target="_blank">https://www.lendingclub.com/foliofn/browseNotesLoanPerf.action?showfoliofn=true&loan_id=7731130&order_id=27161773&note_id=32136061

Now look at the tables below:

Loan IntPrinPaymntIntPaidPrPaidBal
121.70%25.000.950.450.5024.50
20.950.440.5124.00
30.950.430.5223.48
40.950.420.5322.95
50.950.420.5322.42
60.950.410.5421.87
70.950.400.5521.32
80.950.390.5620.76
90.950.380.5720.18YTMPur PricePaymntIntPaidPrPaidBalADJYTMPur PricePaymntIntPaidPrPaidBal
100.950.360.5919.60..17.77%21.000.950.310.6420.36..16.99%21.210.950.300.6520.56
110.950.350.6019.000.950.300.6519.710.950.290.6619.90
120.950.340.6118.390.950.290.6619.050.950.280.6719.23
130.950.330.6217.780.950.280.6718.390.950.270.6818.56
140.950.320.6317.150.950.270.6817.710.950.260.6917.87
150.950.310.6416.510.950.260.6917.020.950.250.7017.17
160.950.300.6515.860.950.250.7016.320.950.240.7116.46
170.950.290.6615.190.950.240.7115.610.950.230.7215.75
180.950.270.6814.520.950.230.7214.900.950.220.7315.02
190.950.260.6913.830.950.220.7314.170.950.210.7414.28
200.950.250.7013.130.950.210.7413.430.950.200.7513.54
210.950.240.7112.420.950.200.7512.680.950.190.7612.78
220.950.220.7311.690.950.190.7611.910.950.180.7712.01
230.950.210.7410.950.950.180.7711.140.950.170.7811.23
240.950.200.7510.200.950.160.7910.350.950.160.7910.44
250.950.180.779.440.950.150.809.560.950.150.809.63
260.950.170.788.660.950.140.818.750.950.140.818.82
270.950.160.797.860.950.130.827.930.950.120.838.00
280.950.140.817.060.950.120.837.100.950.110.847.16
290.950.130.826.230.950.110.846.250.950.100.856.31
300.950.110.845.400.950.090.865.390.950.090.865.45
310.950.100.854.540.950.080.874.520.950.080.874.58
320.950.080.873.680.950.070.883.640.950.060.893.69
330.950.070.882.790.950.050.902.740.950.050.902.79
340.950.050.901.890.950.040.911.840.950.040.911.88
350.950.030.920.980.950.030.920.910.950.030.920.96
360.950.020.930.040.950.010.94-0.020.950.010.940.02

You should recognize the leftmost portion of the table with 36 lines as the "Amortization table" for the original loan. The bold data is given and all the rest of the table is computed from those first three items, Interest, loan amount, and installment payment. You should go to the trouble of creating this table for yourself in excel.

Focus now on the middle table. The loan has had 9 payments made with 27 remaining payments. We do exactly as we did for the original amortization table replacing interest with YTM and loan amount with the asking price of the loan for sale. The borrowers payment remains the same. If you notice on line 36 everything ends with a zero balance neglecting small rounding errors of a few cents. So the first level answer to your question is that the stated YTM on Folio is correctly calculated EXCEPT it does not include the 1% they will charge you on the sale. The rightmost set of data indicates that after their service fee (add 1% to the price) the ACTUAL yield to maturity on this revenue stream (assuming THIS borrower makes all payments) is 16.99% which is iteratively determined (guess the answer and watch the ending balance get near to zero).

Notice that while Folio takes 1% the yield is reduced by a lesser amount (about .78%). You will read this if you study the LC site regarding returns and yields.

One other thing that concerns me is your "strategy has been to buy loans that have 12 months or less payments and never late". So you are purchasing loans when they are most likely to default. See http://www.lendacademy.com/forum/index.php?topic=2364.0" class="bbc_link" target="_blank">http://www.lendacademy.com/forum/index.php?topic=2364.0 and http://blog.lendingrobot.com/" class="bbc_link" target="_blank">http://blog.lendingrobot.com/)

Hope this helps. Your in the right place. Go to unread post since last visit and read the posts with most replies first and follow the links in them. These are generally important. Participate in the discussions and ask question when you don't understand. These are nice folks and someone almost always answers even the silliest of questions although you might have to grovel now and again. 

Again, I mean no disrespect. If you already knew all this, welcome to the board and happy investing.


#47
Investors - LC / Lending Club API?
July 24, 2014, 11:00:00 PM
You need to apply to LC for access to thee API and fill out some additional forms. Email investor services here [email protected]. They will send the documentation.
#48
Investors - LC /
July 22, 2014, 11:00:00 PM
You beat me to it trevor!
#49
NSR Invest / firefox vs loss estimates fields
July 20, 2014, 11:00:00 PM
Hey Fred,

I use firefox and can't recreate you problem. I am using a version 30.0.0.5269 downloaded a few weeks ago so try the updated version.
#51
Investors - LC / Taxes - a sanity check
July 04, 2014, 11:00:00 PM
From the same IRS publication 1212:

"Including OID in income.   Generally, you include OID in income as it accrues each year, whether or not you receive any payments from the debt instrument issuer.

Exceptions.   The rules for including OID in income as it accrues generally do not apply to the following debt instruments.

    U.S. savings bonds.

    Tax-exempt obligations. (However, see Tax-Exempt Bonds and Coupons, later.)

    Obligations issued by individuals before March 2, 1984.

    Loans of $10,000 or less between individuals who are not in the business of lending money. (The dollar limit includes outstanding prior loans by the lender to the borrower.) This exception does not apply if a principal purpose of the loan is to avoid any federal tax."


Why doesn't the bold exception cover all we little guys?
#52
Investors - LC / Loan id assignment
July 03, 2014, 11:00:00 PM
Can anyone explain the range of assigned loan id numbers? I downloaded notes this morning after the 06:00 release. There were roughly 1000 loans. About 900 have well behaved number between 20,000,000 and 20,800,000. But the other 100 are all over the place from about this range all the way down to 853585. There is no correlation with application date, grade or any of the date fields that I can detect.

I would have guessed a 6 digit loan id was issued many years ago?

-----------------------------------
PROGRESS

I have done a little work on this. The low loan id numbers do correspond with lower member numbers. I thought at first these might be returning customers but the member #s do not show up in the loan history csv. But nearby member numbers do and they have nearby loan ids. For instance the 6 digit id 853585 mentioned earlier has a member #1065759. The closest member number to have actually received a loan was member number 1065749 who has a loan id number of 853576 issued 8/25/2011.

So here are my guesses:
1. These are borrowers who applied and were approved for loans a long time ago, and who withdrew their applications for some reason and whose business LC has continued to solicit.
2. These are borrowers who applied for loans a long time ago and were rejected. However LC has re-reviewed these applications together with updated credit reports and is now prepared to offer to their lenders.

Any other ideas?
#53
NSR Invest / LC loan number comparison
July 02, 2014, 11:00:00 PM
I have recently downloaded all 3 of LC's historical loan files, merged them all to get a loan count of 275066 thru 3/31/2014. When I backfilter LC loans on NS and cut off loans after 3/31/2014 I get a loan count of 277814. I know the difference is small and unlikely to affect my statistics significantly but I'm nervous when I can't even get a stat this simple to agree with what I see in what I thought was the same original data set?
Are there LC loans that have been purged for some reason that NS captured in their regular downloads and has preserved?
I'm confused.
#54
Sorry, I don't know. But I tried soapUI last week and never could get the credentials in correctly to get anything to work. I got the methods imported OK but always got either no credentials or incorrect credentials errors in every case. soapUI is a large program and and mostly Greek to me.