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My hardship loan experience

Started by Peter, September 06, 2020, 11:00:00 PM

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JDII

Good morning all,

I have been seeing a lot of comments in the forum in regards to hardship loans. Most of the discussion seems to be based around the secondary market. I have not yet entered that area of trading but thought I would give you my limited view from my account.

Over the past two months I've had about twenty loans in hardship pay off completely.  I'm always a bit surprised to see that but it is a pleasant surprise.  Why is someone in hardship if they can gather up the money to pay off the whole loan? I'm sure there are many reasons and theories.

It seems, from my limited view through the keyhole, that the hardship loans are not a death sentence for your investment. Not as of yet anyway.


TravelingPennies

I've had two loans in hardship status in the past two days that have paid off in full.  That is good I guess.



TravelingPennies

LC also added a "View hardship notes only" checkbox on the notes page. I think it's just the recent Covid-related notes because none are charged off. In any case, it shows I have 92 total, 13 Paid, 3 IGP, 1 Late 16-30, and 2 Late 31-120. (Out of 4,182 notes, of which only 1,242 are current, 39 IGP, 11 Late 16-30, and 22 Late 31-120 with 782 C/O)

Under 10% being hardship and less than 10% of those being delinquent seems really good, seeing as how 20% of the country has lost their jobs.

I'm also seeing higher recoveries, and less late notes, although IGP is back to the normal level this month. IGP was also high last month, but most wound up paying or deferring (hardship but marked current). I have one note showing a payment due date in October and one in November, but they're fully paid. That's odd. All the rest are currently only deferred until end of September at the latest.

Recoveries from my taxable account:

https://i.imgur.com/CaajuQw.png" class="bbc_link" target="_blank">https://i.imgur.com/CaajuQw.png

Which I've drawn down by around 50% since September. 50% D grade, 30% C, 10% E, 6% B and the remainder F & G.

For some context of how it's been going, here's my detailed breakdown of the past 4 years:

https://i.imgur.com/thhEjve.png" class="bbc_link" target="_blank">https://i.imgur.com/thhEjve.png

I'm actually doing better than before, though I'm not sure if that's more related to not reinvesting... Over the life of the account, I've had A few negative months, but it's been a lot better than what I was expecting reading this forum 4 years ago on the heels of the scandal. Too bad my state got barred from the primary market or I'd still be investing in this account. (Don't want the headache of folio investing on a taxable account. Getting even better results in folio on my Roth IRA though.) Besides, it's like supplemental unemployment income! lol

LC has been a good hedge IMO, just need to put in the time back-testing to develop good loan filters and reevaluate them every few months.

You mentioned and interest in Folio, so i'll just say that my account with NO Folio exposure is doing great now, and my other account which is now about 50% Folio since switching from 0% to 100% Folio in September is doing even better from just buying never late notes with the same filters. Though it's still early, it seems like the expected outcome.

Good luck out there.




TravelingPennies

As of 08.07.20

22 Total hardship

15 "current" (for lack of a better term)

7 fully paid






TravelingPennies

As of 08.14.20

26 Total hardship

19 "current" (for lack of a better term)

7 fully paid

TravelingPennies

As of 08.28.20

19 "current" (for lack of a better term)

LC has moved the 7 that were fully paid out of hardship status.

I'm getting payments on some of these.  I also had at least seven that paid off.

The situation seems be okay for now.


TravelingPennies

As of 09.01.20

15 "current" (for lack of a better term). I was at 19 a few days at ago

Two paid off fully yesterday.

Two more have caught up with their payments and have left hardship status.

The situation seems be okay for now.

LA87654

My Adjustment for Past-Due Notes has jumped up in the last week from the 700s to over $1K.  I haven't dug into why, but my first thought is hardship loans going bad.

NEW LOANS:   | 804.eth 2.500 Ξ | remoraid.eth 0.299 Ξ | remoraid.eth 0.299 Ξ | ALL