[DJ-Matt]

My lending club update after a few more months, 6 of my 34 notes have defaulted, most of them bankruptcies. Do NOT buy E, F or G loans!

Out of my $500 starting amount I have about $520 in value now after over a year of LC, all the interest has been taken away by deadbeats.

So far my LC stock has made me more money!

[CleanSlate]

I've been pulling out of LC and selling my notes. I've gotten fucked by the deadbeats, but strangely they were mostly C and D notes. The E, F, and G did fine.

I'm wondering if the rise in defaults is a sign of incoming turbulent times in the larger economy, though. Looking back on this thread's history, there surely haven't been this many defaults.

[DJ-Matt]

(03-27-2017 07:23 PM)CleanSlate Wrote:  

I've been pulling out of LC and selling my notes. I've gotten fucked by the deadbeats, but strangely they were mostly C and D notes. The E, F, and G did fine.

I'm wondering if the rise in defaults is a sign of incoming turbulent times in the larger economy, though. Looking back on this thread's history, there surely haven't been this many defaults.

I think you're on to something there, my defaults and bankruptcies have all happened in the last 6 months or less, before that things were good. It does piss me off that these bastards got a loan and made 8 payments or less then went bankrupt. You'd think they could be prosecuted for fraud because I assume things were bad when they applied for the loan.

[Neo]

So I've had three total defaults since I started. The one mentioned a few months back and two other ones. Right now I have 3 that are in the 61-90 days late.

The pattern I'm seeing is once it hits that mark of being late, it's pretty much a definite default. Prosper did sell one of my defaulted notes and credited my account like $2 and change. I guess it's a new system where they sell the defaulted note off to a debt buyer and you recover about 10% of the purchase price. (I usually just invest $25) It does help to recover some of the cost and I'm sure it will add up over time.

I also am seeing many more notes being shown as late. I think with the defaults this month may be the first month I don't see a positive return. I've been getting like ~$50 a month passive. Will update once my return numbers are updated with the defaults added in.

[MrRemi]

Quick update on my Mintos experience: I started to invest beginning of January 2017. So it has now been 5 months. I started with 500 Euro. My account balance as of today is 467.02 Euro plus 126 GEL (Georgian currency). Converted that's a total of 514.17 Euro. The account shows me a "net annual return" of 12.41% in Euro and 17.17% in GEL. Myself I calculate only a 6.9% return.

514.17/500 -1 = 2.83%

Or annualized that's

(514.17/500)^(1/5)^12-1 = 6.94%

Now I have some long term loans in my portfolio that repay the principal only at the end. I believe the displayed values don't take into account the long duration and that's why I calculate a lower return.

I mostly invested in business and mortgage loans with a low LTV (loan-to-value), preferably under 70%. I thought that even if they go default, the asset or house could be sold and pay the loan. Now I have 3 loans in default, all with LTV under 50% that I wait for debt collection. One of them had the last debt collection update in January. So today I chatted with Mintos support, they promised me an answer by e-mail.

Overall my experience with Mintos is so-so. It was interesting to try it out myself. However, I will not waste more time with it and instead focus on my stock market investments.

[Neo]

Been a while since I posted an update to this thread. I logged onto my Prosper account a few days ago and my seasoned returns are at 10.92%.

So far for me this experiment has been going well. It's not something you're going to get rich off of or even build a huge amount of passive income (unless you put in bigger sums) but as another investment vehicle I recommend it.

[Bacchus]

I've been on prosper for almost a year and have invested the minimum for each loan. So far my returns are around 12%. I picked loans from boring Midwestern states with employed as a status (not other or self-employed). Even better if they list an actual job. Most of them were home improvement, but I've done some debt consolidation and some other categories. Most loans fall in the B and C categories, but I've picked at least one from each category.

I like peer-to-peer lending better than bonds, but with one caveat. I'm bearish on the overall US economy, so I'm scaling back what I'm putting into Prosper. How will the loans be repaid after the next crash?

[Polniy_Sostav]

Can someone explain to me the formula behind my next payment (on Mintos)
I have 10 Euro in a short-term loan started two days ago , lasting one week.
I will be paid in 5 days.
The interest rate is 13% (annually)

My estimated next payment is 10.02 Euro.

I have done all sorts of basic calculations and I do not understand it.

[Dr Mantis Toboggan]

The 13% is the annual interest rate, you're only loaning the money for 5 days

13% X (5/365) = ~0.17%. If they're using a 360 day year then ~0.18%

0.17% X €10 = 1.7c which rounds to 2c

Never mind, just saw the loan is actually a week and you issued it 2 days ago. Still the math is the same and it comes out to 2.49c

[RatInTheWoods]

This sounded like a great idea at the time, I was going to get into it.

It seems like defaults are the real risk, meaning its not safe to put in large chunks of money, and not profitable to put in small chunks.

Shame, was a good idea on paper.

[ChicagoFire]

I started doing P2P lending as per Financial Samurai's advice years ago. Like others have stated defaults are real and in my opinion it's not worth it. My returns are at about 5% so just slightly above the inflation rate.

With those subpar returns you're better off putting money in high return items like crypto or time proven instruments like stocks.

[Dr Mantis Toboggan]

I don't really know a ton about this vehicle but from reading this thread it seems like the only way for this to be significantly profitable would be a sizeable chunk of capital split into <$50 or so loans. The risk of any single debtor defaulting is high but overall the majority should still repay you (this is the same concept behind large numbers of junk mortgages being bundled into derivatives that collectively had significantly higher risk ratings than any of the underlying assets did on their own). Problem is that you're now spending all your time on these websites going through $25 loan requests.