P2P Lending / NFT Lending Forum

Hate. It.

I made the mistake of starting off with automated investing, and my returns have been decimated by the defaults.  I've learned a lot since then, most of it from this forum.  Why I haven't bailed on LC is that the majority loans do get paid in full (well, so far, anyway).  So I have challenged myself to find a fairly reliable way to avoid loans that default.  Betting on my own investment strategy keeps it interesting.

Yes, I noticed that my number of FP loans dropped by 2 recently.  I have not (yet) tried to track down what and why because something else popped up that caught my attention: a note I held that issued and defaulted in 2016 was listed as "Not Verified" in the historical data files, but now shows up as "Source Verified" in my notes_ext file (and I download these files regularly so this had to be a recent change).  Not a big deal as it is fini, but I did submit an inquiry.  So I'm beginning to wonder about LC's data management.

My code also flushed out 127342041, but not enough data to predict a default probability.

Here's my worst of this morning:  127296020, C2 (13.59%).  My code predicts a 34.6% probability of defaulting.  Would be curious to see other folks' numbers on this as I am not using linear reg.

"We expect loan volume to shift toward higher quality grades (grades A and B) because some borrowers will qualify for lower interest rates under the new model..."

Kind of reminds me of another quote by Will Rogers:  "When the Oakies left Oklahoma and moved to California, it raised the I.Q. of both states."

I hear you, Skeptical.  Before I learned about backtesting and filtering, I started off with the automated investing.  Even though I went with the most conservative setting, I am just inundated with Lates and Defaults.  Since then I've learned a lot and wrote my own backtesting and analysis codes, but that initial investment I don't think I can overcome.  The only reason I haven't bailed is to see if my method works.

I started with an initial investment of 200 loans.  Of the 16 Defaults in my portfolio, 13 were with automated investing.  Of the 9 Late loans, 7 were with automated investing.  It is very discouraging because my returns are just awful.

It's funny-- folks bemoan early payoffs.  I'm so happy they paid off and didn't default!

I asked about this once when I noted the collection log showed no contact activity on a late loan.  Here is an excerpt of the reply I received from LC:

"Generally, when a loan is delinquent and the collection log on a loan performance page does not have any updates, it is due to unconfirmed information that we have received pertaining to a borrower's account. For example, if a borrower tells us that they have filed for bankruptcy, we do not update the loan performance page to show that information until we have confirmed the bankruptcy. Additionally, we are unable to contact the borrower once they mention bankruptcy to us.

Similarly, if a borrower begins working with a debt management company or is going through a debt settlement, we are unable to update the loan performance page until we have received confirmation and we are unable to reach out until the debt management company permits.

Another example for when a loan performance page is not updated is when we hear news that a borrower has passed away. We cannot update the collection log until we have received confirmation."


For the loan I was inquiring about, all of a sudden it was paid off when it was pretty late-- great news!  As a side note, I also have another loan where there was a note in the log that the borrower had passed away.  Hope that helps.

I skip renters taking out home improvement loans.  Don't understand it, therefore I am not going to participate.  But if anyone has a logical explanation for it, I am interested to hear.