Lend Academy Network Forum

Lending Club Discussion => Investors - LC => Topic started by: pd103kid on April 17, 2014, 12:47:27 PM

Title: Give up some numbers.
Post by: pd103kid on April 17, 2014, 12:47:27 PM
OK! So I'm on my iMac 27 (paid for by Lending Club interest) listening to Janis Joplin on Pandora and wondering to myself - what are you  dude's on this system doing with their money? Below are my numbers off of my taxable account. I am using 'Prime' as my automated investment scheme ; how about yourself?

In Funding  50
Issued & Current  2,286
In Grace Period  14
Fully Paid  765
Late 16 - 30 Days  3
Late 31 - 120 Days  24
Default  4
Charged Off  99
 
My charge off rate is around 3.33 percent and the vast majority of my notes are for $25. For some reason, perhaps driven by the Martini I am currently imbibing is that I'm doing pretty well compared to the poor fools out there trying to make use of CD's. Chime in with your comments; not so much as to my being a old drunkard but more to the use of Lending Club to make us rich!
 
Joe
Title: Re: Give up some numbers.
Post by: PeerSocialLending on April 17, 2014, 01:36:50 PM
Currently just reinvesting and adding to my account as much as I can.  I don't plan on making any withdrawals unless it is to re-balance my overall investment portfolio. 


My Notes at-a-Glance (450)   

        In Funding 35
        Issued & Current  390
        In Grace Period 3
        Fully Paid 17   
        Late 16 - 30 Days  0
        Late 31 - 120 Days 2
        Default   1
        Charged Off    2

Title: Re: Give up some numbers.
Post by: rlv99 on April 17, 2014, 01:39:43 PM
In Funding      12
issued & Current  2,234
In Grace period        25
Fully Paid              130
Late 16-30               7
late  31-120           20
Default                   3
charged off             9 
Adjusted NAR        15.76%

Most of the above notes are $50. This account was opened 14 months ago.  I have a second account (IRA; average note $100.) which I opened in January, 2014.  Although fully funded now, too immature to recite here.

While I have used IR and Blue Vestment for auto-invest, I prefer to use the LC filters and select my loans "manually".

Since I am already retired my goal is not to "make us rich" but to supplement existing income and preserve principle which LC has accomplished for me to date.  I drag out amounts equal to interest earned during the month minus defaults and charge offs.

Since the number of your Fully Paid is greater than mine I assume you have been on the platform longer than me which would account for the higher number of charge offs as well.  Thanks for sharing.


Title: Re: Give up some numbers.
Post by: cnmor54 on April 17, 2014, 01:44:28 PM

In Funding  82
Issued & Current  903
In Grace Period  3
Fully Paid  50
Late 16 - 30 Days  5
Late 31 - 120 Days  11
Default  1
Charged Off  5
 
All but 8 of my notes are $25. I have been slowly upping my investment since this past May and I started selling on folio heavily in January.  I initially started with the idea of doing just a little better than CDs but it has since  turned into quite the hobby.

And a toast to Janis.

Carol
Title: Re: Give up some numbers.
Post by: gamassey on April 17, 2014, 04:28:15 PM
In Funding:  42
Issued & Current:  1,221
In Grace Period:  4
Fully Paid:  33
Late 16 - 30 Days:  1
Late 31 - 120 Days:  9
Default:  3
Charged Off:  2
NAR: 14.32%

99% are $25 loans.  I hand pick only the finest high interest loans and hope for the best.  All interest is being re-invested until I double my initial investment.
Title: Re: Give up some numbers.
Post by: RaymondG on April 17, 2014, 10:51:46 PM
What's the average age of portfolio?
Title: Re: Give up some numbers.
Post by: Fred on April 18, 2014, 03:21:40 AM
What's the average age of portfolio?

Yes, to make meaningful comparisons, the portfolio age and NAR are more important than the number of notes for each status.
Title: Re: Give up some numbers.
Post by: storm on April 18, 2014, 04:51:05 AM
In Funding 67
Issued & Current 2,270
In Grace Period 3
Fully Paid 954   
Late 16 - 30 Days 1
Late 31 - 120 Days 8
Default 0
Charged Off 11
NAR 12.82%
Average Age of Portfolio: 23.1 mos

And, yes, I sell my IGP loans on FolioFN.  The late loans are bankruptcies that I can't list for sale any more.   :'(
Title: Re: Give up some numbers.
Post by: pd103kid on April 18, 2014, 07:06:16 AM
Everyone seems to be doing well! I'll add a few more numbers off of my taxable account. I do have one IRA but it is small in comparison.
 
The account has been open for 3 years and 6 months. My last months interest totaled $373.00 for an Adjusted Net Annualized Return of 6.79% with an outstanding principal base of $41,500. I deposit $100 per week from a bank through EFT and let 'Prime' do the selection although originally I picked loans manually. It simply got too labor intensive!
 
As I had mentioned my charge off rate is around 3.33%; reasonable, I think, for my mix of notes - A 30%, B 48%, C 15% D 5% and others 2%.
Title: Re: Give up some numbers.
Post by: rawraw on April 18, 2014, 07:07:48 AM
Adjusted NAR 12.73%

In Funding 14
Issued & Current 998
In Grace Period 3
Fully Paid 165
Late 16 - 30 Days 1
Late 31 - 120 Days 13
Default 0
Charged Off 4

A (5.1%) B (38.1%) C(32.1%) D(16.4%) E(6.5%) F(1.7%) G(0.2%)

Title: Give up some numbers.
Post by: rockinray on April 18, 2014, 12:55:52 PM

Everyone seems to be doing well! I'll add a few more numbers off of my taxable account. I do have one IRA but it is small in comparison.
 
The account has been open for 3 years and 6 months. My last months interest totaled $373.00 for an Adjusted Net Annualized Return of 6.79% with an outstanding principal base of $41,500. I deposit $100 per week from a bank through EFT and let 'Prime' do the selection although originally I picked loans manually. It simply got too labor intensive!
 
As I had mentioned my charge off rate is around 3.33%; reasonable, I think, for my mix of notes - A 30%, B 48%, C 15% D 5% and others 2%.

Interesting. Are you doing a combination of 36/60 month notes? Or 36 only? 60 only?decent return and nice lie default rate!

Ray


Sent from my iPhone using Tapatalk
Title: Re: Give up some numbers.
Post by: Booleans on April 19, 2014, 06:21:45 PM
Adjusted NAR of 11.95%.

(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fi.imgur.com%2FZCPxxTG.png&hash=874cc0088dbbeec4f84518e7e07b3a3b)

I have no note over $25. Approximately 30% of my portfolio is 60 month notes but I don't think I'll be investing in those any longer.
Title: Re: Give up some numbers.
Post by: Lovinglifestyle on April 19, 2014, 09:42:04 PM
Return Over Deposits (IR) 15.19
IRR (Interest Radar)         11.70%

NAR                                 17.68%
Adjusted NAR                    17.11%

My Notes at-a-Glance    (5336)   
In Funding                       101
Issued & Current           4,108
In Grace Period                  46
Fully Paid                      1,033
Late 16 - 30 Days              12
Late 31 - 120 Days            15
Default                                0
Charged Off                        21

Average Age:     9 mos. (started in '08)
Term:  56.9%  60 mos.
           43.1%  36 mos.

All notes are $25 except  for 25 notes which are $50 (by accident!). 
I favor 36 mos. notes when possible, and all selections have been manual so far.
Also, I use Folio for loss mitigation but would rather not "have to".
Title: Re: Give up some numbers.
Post by: pd103kid on April 20, 2014, 08:34:35 AM
I hold a mixture of $25 and $50 notes but the $50's are very minimal now for I started out mixing but have been at $25 for at least two years. The same can be said for 36 and 60 month notes and the 60's are also minimal now for I've been exclusively 36 months again for at least two years.

Adjusted Net Annualized Return :   6.78 %
Weighted Average Interest Rate:   10.85%
Average Age of Portfolio:           19.0 mos
Number of Notes:                   3,259
 
Interesting on the defaults; they were small in number (as might be expected) when I did my selections manually early on. Once I handed off my allocating to the machines it has increased. This all makes sense for I tended to concentrate on A and B notes when I was involved so when PRIME took the helm it began (as advertised) pulling down many more lower quality notes.
 
Still, compared to Money Markets at 0.01 percent (and they are losing money keeping it at $1) or my "High Yield" CD's at say 1% for a year a Lending Club account, (computer driven or manual) is far superior in today's Central Banks driven slow deflationary spiral.
Title: Re: Give up some numbers.
Post by: mikedave on April 21, 2014, 01:22:16 PM

In Funding   31
Issued & Current   1,022
In Grace Period   3
Fully Paid   38   
Late 16 - 30 Days   1
Late 31 - 120 Days   6
Default   0
Charged Off 0
Ave age 6mo

From Interest Radar
Return over deposits:   8.08%
IRR:   14.85%

A
B   48   
C   731   
D   227   
E   92   
F   2   
G   1   
Sum   1,101   

This is a mix of new notes purchased mainly using IR filters (~70%), and notes purchased on Folio (~30%) I sell quite a few notes of Folio also
Title: Re: Give up some numbers.
Post by: Bohb Daishi on April 22, 2014, 01:30:54 AM
In Funding                11
Issued & Current      178
In Grace Period         52
Fully Paid                  48
Late 16 - 30 Days     18
Late 31 - 120 Days   738
Default                      51
Charged Off              298
NAR:                         -40.47%
Title: Re: Give up some numbers.
Post by: lascott on April 22, 2014, 09:36:34 AM
In Funding                11
Issued & Current      178
In Grace Period         52
Fully Paid                  48
Late 16 - 30 Days     18
Late 31 - 120 Days   738
Default                      51
Charged Off              298
NAR:                         -40.47%
   ??? (huh?)   :o (shocked).   
What does your composition (grade) look like on:
https://www.lendingclub.com/account/lenderAccountDetail.action
Oh wait.  I think you are making those numbers up.  Screen shot?
Title: Re: Give up some numbers.
Post by: Ran on April 22, 2014, 10:06:43 AM
In Funding                11
Issued & Current      178
In Grace Period         52
Fully Paid                  48
Late 16 - 30 Days     18
Late 31 - 120 Days   738
Default                      51
Charged Off              298
NAR:                         -40.47%
   ??? (huh?)   :o (shocked).   
What does your composition (grade) look like on:
https://www.lendingclub.com/account/lenderAccountDetail.action
Oh wait.  I think you are making those numbers up.  Screen shot?
Bohb is a Foliofn guy and LendingClub always "think" people paid full principal price for Foliofn notes, even for bankruptcy notes.
Title: Re: Give up some numbers.
Post by: Jomar on April 22, 2014, 10:43:02 AM
In Funding                11
Issued & Current      178
In Grace Period         52
Fully Paid                  48
Late 16 - 30 Days     18
Late 31 - 120 Days   738
Default                      51
Charged Off              298
NAR:                         -40.47%

What is your XIRR like with the Folio-only strategy?
Title: Re: Give up some numbers.
Post by: core on April 22, 2014, 02:14:28 PM
What is your XIRR like with the Folio-only strategy?

I don't know what Bohb's is, but I'm also using a Folio-only strategy and my numbers look similarly miserable (at least as reported by LC).  Yet my XIRR as of today is 440.03%, which is for a bit less than 3 years of trading.  If I didn't make periodic withdrawals and let my balance climb above $50k then my XIRR would have been lower by now... possibly much lower.  LC is showing my adjusted NAR at -9.04%.

Funny how I'm one of those 800+ note folks who managed to "LOSE" money, I guess part of the reason they had to remove that claim that nobody with 800 notes has had a negative return.  But my return was pretty decent in reality.  If they tracked things properly their own published stats would probably look better and they could resume making all sorts of silly/pointless claims.
Title: Re: Give up some numbers.
Post by: rawraw on April 22, 2014, 02:45:08 PM
What is your XIRR like with the Folio-only strategy?

I don't know what Bohb's is, but I'm also using a Folio-only strategy and my numbers look similarly miserable (at least as reported by LC).  Yet my XIRR as of today is 440.03%, which is for a bit less than 3 years of trading.  If I didn't make periodic withdrawals and let my balance climb above $50k then my XIRR would have been lower by now... possibly much lower.  LC is showing my adjusted NAR at -9.04%.

Funny how I'm one of those 800+ note folks who managed to "LOSE" money, I guess part of the reason they had to remove that claim that nobody with 800 notes has had a negative return.  But my return was pretty decent in reality.  If they tracked things properly their own published stats would probably look better and they could resume making all sorts of silly/pointless claims.
HA HA HA 

Is there anyone else like you?  Or are you the sole reason that we know of?
Title: Re: Give up some numbers.
Post by: core on April 22, 2014, 03:34:14 PM
Is there anyone else like you?  Or are you the sole reason that we know of?

Actually my NAR wasn't negative until relatively recently when they came out with this adjusted stuff.  They had already stopped making the 800 note claim by then I think.  NJGuy likely had a solidly negative NAR way before me. 

I suspect part of the reason for them dropping the 800-note claim was a group of Folio idiots who bought hundreds of $1-2 notes from me and other traders for 70% markup.  It would be easy to get to 800 notes in an afternoon with just a small account balance if you really tried, and then the next day realize you lost quite a bit overnight.  Why would someone do such a thing?  Possibly precisely because of the claims about nobody ever losing money with 800 notes.  It must be tempting to get to 800 as quickly as possible after reading such marketing when your brain doesn't function properly.  Maybe I 'misunderestimate' people though.
Title: Re: Give up some numbers.
Post by: merits on April 23, 2014, 12:14:26 AM
In Funding  53
Issued & Current 1,360
In Grace Period 67
Fully Paid 40
Late 16 - 30 Days 46
Late 31 - 120 Days 291
Default  15
Charged Off 15
NAR: -42.52%

A great many of deep discount Folio notes

Title: Re: Give up some numbers.
Post by: merits on April 23, 2014, 12:18:53 AM
In Funding                11
Issued & Current      178
In Grace Period         52
Fully Paid                  48
Late 16 - 30 Days     18
Late 31 - 120 Days   738
Default                      51
Charged Off              298
NAR:                         -40.47%

Is your strategy focused on late31-120 notes?
Title: Re: Give up some numbers.
Post by: Bohb Daishi on April 23, 2014, 02:59:25 AM
In Funding                11
Issued & Current      178
In Grace Period         52
Fully Paid                  48
Late 16 - 30 Days     18
Late 31 - 120 Days   738
Default                      51
Charged Off              298
NAR:                         -40.47%
   ??? (huh?)   :o (shocked).   
What does your composition (grade) look like on:
https://www.lendingclub.com/account/lenderAccountDetail.action
Oh wait.  I think you are making those numbers up.  Screen shot?

These numbers are legit. However, the numbers are largely meaningless because about 95% of my purchases are for trading. The average duration that I hold a note (from purchase date to sell date) is about 51 days and capital gains aren't included in NAR.

Is your strategy focused on late31-120 notes?

Many of my strategies are focused on late notes, but not all.
Title: Re: Give up some numbers.
Post by: lascott on July 12, 2014, 11:46:22 AM
I'm pretty new to all of this (obvious after seeing below!). A leg of my retirement stool. Shooting for net 9-11%.
----
Returns:
Quote
Adjusted Net Annualized Return:   15.46 %
Weighted Average Interest Rate:   16.69%
Average Age of Portfolio:   1.4 mos
Number of Notes:   1,131
My notes:
Quote
Notes at-a-Glance 1131
In Funding 105
Issued & Current 1,010
In Grace Period 0
Fully Paid 15
Late 16 - 30 Days 0
Late 31 - 120 Days 1
Default 0
Charged Off 0
Term:
Quote
Weighted average term: 39.2
How $25 notes picked:
Quote
LendingRobot: ~12%
P2P-Picks Max (via BV): ~80%
P2P-Picks Min (via BV): ~2%
WYourOwnR (via BV): ~4%
IntRadar: ~3%
lenderAccountDetail.action
Quote
A: 5.9%
B: 3.2%
C: 21.4%
D: 42.2%
E: 25.5%
F: 1.8%
G: 0.1%
As & Bs - was a self-inflicted oops with a BV filter setup but at least it was using P2P-Picks!
Title: Re: Give up some numbers.
Post by: DLIFVOIP on July 19, 2014, 05:32:11 PM
Here are my numbers.  I only buy new loans and only sell non performing loans on the FOLIO platform.  For the first 4 years of investing I only did $25 per, but since the beginning of the year I had to increase to $50 per to keep up with reinvesting payments as well as being able to invest new funds.


In Funding - 176
Issued & Current - 18,068
In Grace Period - 83
Fully Paid - 4,525
Late 16 - 30 Days - 23
Late 31 - 120 Days - 47
Default - 2
Charged Off - 53


Grade breakdown is as follows:

A - 29.7%
B - 34.7%
C - 24.1%
D - 8.4%
E - 2.2%
F - 0.6%
G - 0.1%

LC says my NAR is 11.15%, but as I said I sell on the Folio platform so not 100% accurate.  My XIRR is 9.55% however it will typically take me over 30 days to invest new funds when I make large deposits, so XIRR is not 100% accurate as well as funds sit around for a while sometimes.  So my real return is between the two.  I really do not focus on those #'s as I like to look at actual $ return each month based on beginning of month o/s principle.
Title: Re: Give up some numbers.
Post by: lascott on July 20, 2014, 09:41:20 AM
Issued & Current - 18,068
A   29.70%   5366
B   34.70%   6270
C   24.10%   4354
D   8.40%   1518
E   2.20%   397
F   0.60%   108
G   0.10%   18
Those are some very interesting numbers to get 10%. Lates thru Charge offs are pretty small so the folio sales are demonstrating that. ("LC says my NAR is 11.15% ... My XIRR is 9.55% ....  So my real return is between the two.")  Very impressive.
(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fi.imgur.com%2FMGvOp3p.png&hash=3a5736fa12fb6def13e041ae539bd9ab)
Title: Re: Give up some numbers.
Post by: BruiserB on July 20, 2014, 08:17:46 PM
I've been in Lending Club since around September of 2011 and have been adding funds each year.  I started out completely manually investing with just my gut feel by reading individual loan applications.  Then I discovered Peter's yearly "How I'm Investing..." posts and started to mimic his filters as best as I could....either by downloading notes available and sorting in Excel (cumbersome) or by having NickelSteamRoller send me filter matches and still clicking manually.  I was getting discouraged by how much work it was to keep up and how you had to be fast to find matches.  Then everything changed around the beginning of this year when I found an ad for LendingRobot on Facebook and I automated my loan purchasing!  Since then I have also discovered BlueVestment.  Together these services have automated my filter investing and I have added some notes through P2P-Picks to my BlueVestment buying and started using LendingRobot's Expected Yield modeling to select notes.  This year I have more than doubled my LC investment and have no trouble keeping payments reinvested!  Third party investing totally changed the way I invest and the knowledge of Peter and the others on the boards here have educated me greatly since I picked my first loans by the "this person seems nice" method!

I haven't bought or sold at all on Folio....still educating myself but not feeling the need to do it at this point.

So here are my numbers so far:

In Funding:               186
Issued & Current:   4,427
In Grace Period           34
Fully Paid                  536
Late 16-30                  16
Late 31-120                59
Default                         3
Charged off               181

Composition by $
A     3.2%
B     3.7%
C   14.1%
D   38.1%
E   25.8%
F   11.7%
G    3.4%

36 month 41.5% (has grown a lot this year since using P2P-Picks...was more like 25% before)
60 month 58.5%

Current Average Portfolio Age 12 months (have added about half my account value since January)

Weighted Average Rate 18.47%
LC NAR                        13.35%
LC Adjusted NAR           11.29%

Overall XIRR                 11.54%  (since opening my account)
2011 XIRR                    10.35%
2012 XIRR                    10.76%
2013 XIRR                    12.17%
2014 YTD XIRR             11.41%

I also have an IRA that I started late last year and have funded for last year and this year.  It currently is showing an NAR of 15.55% and Adjusted NAR of 12.46%  Overall XIRR is 12.7% so far. 
Title: Re: Give up some numbers.
Post by: DLIFVOIP on July 21, 2014, 12:02:52 PM
Issued & Current - 18,068
A   29.70%   5366
B   34.70%   6270
C   24.10%   4354
D   8.40%   1518
E   2.20%   397
F   0.60%   108
G   0.10%   18
Those are some very interesting numbers to get 10%. Lates thru Charge offs are pretty small so the folio sales are demonstrating that. ("LC says my NAR is 11.15% ... My XIRR is 9.55% ....  So my real return is between the two.")  Very impressive.
(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fi.imgur.com%2FMGvOp3p.png&hash=3a5736fa12fb6def13e041ae539bd9ab)

Thanks.  The only way I make the % I do is by actively managing the non-performing loans.  I track my loss rate based on the year the loan was purchased.  My best year is around 0.7% loss rate and my worst is 1.5%.

I also think by not using automated investing, I am able to pick better loans.  I obviously use filters, but I manually review each loan I purchase.  So I am on the site at the 4 release times a day (it is funny to think about some of the places I have worked from).

Title: Re: Give up some numbers.
Post by: turing on July 21, 2014, 12:26:15 PM
Newbie so not much to show for this account right now.

Account only 1.5 months old.  My other account has more loans but all of them are 'issued' or 'in funding' and 0 months old (started about 2 weeks ago)

In Funding 4
Issued & Current 54
In Grace Period 0
Fully Paid 1
Late 16 - 30 Days 0
Late 31 - 120 Days 0
Default 0
Charge-off 0
Title: Re: Give up some numbers.
Post by: JoeB on July 21, 2014, 10:18:34 PM
Here are my numbers.  I only buy new loans and only sell non performing loans on the FOLIO platform.  For the first 4 years of investing I only did $25 per, but since the beginning of the year I had to increase to $50 per to keep up with reinvesting payments as well as being able to invest new funds.


In Funding - 176
Issued & Current - 18,068
In Grace Period - 83
Fully Paid - 4,525
Late 16 - 30 Days - 23
Late 31 - 120 Days - 47
Default - 2
Charged Off - 53


Grade breakdown is as follows:

A - 29.7%
B - 34.7%
C - 24.1%
D - 8.4%
E - 2.2%
F - 0.6%
G - 0.1%

LC says my NAR is 11.15%, but as I said I sell on the Folio platform so not 100% accurate.  My XIRR is 9.55% however it will typically take me over 30 days to invest new funds when I make large deposits, so XIRR is not 100% accurate as well as funds sit around for a while sometimes.  So my real return is between the two.  I really do not focus on those #'s as I like to look at actual $ return each month based on beginning of month o/s principle.

Well that's an eye opener! Would like to have 6 figures vested within a year or so. Going slowly. I started in early May of this year. I filter and then select manually. So far I'm confident in my choices. I sold 3 loans on Folio which had dropped 55 to 100 points predominately to see how it worked. Based upon what Circle stated above, it shows me that you can filter/pick manually and still maintain control over a large account.

It's been fun and I have a new hobby.   8)

Here's my showing:

My Notes at-a-Glance 435
o   In Funding 31
o   Issued & Current 403
o   In Grace Period 1
o   Fully Paid 0
o   Late 16 - 30 Days 0
o   Late 31 - 120 Days 0
o   Default 0
o   Charged Off 0

A (0.0%)
B (0.1%)
C (50.1%)
D (37.8%)
E (7.4%)
F (3.1%)
G (1.4%)

NAR = 15.77

I'm about 70/30 weighted in 36ers and currently only purchasing 36ers.
Title: Re: Give up some numbers.
Post by: DLIFVOIP on July 22, 2014, 01:14:10 PM
Issued & Current - 18,068
A   29.70%   5366
B   34.70%   6270
C   24.10%   4354
D   8.40%   1518
E   2.20%   397
F   0.60%   108
G   0.10%   18
Those are some very interesting numbers to get 10%. Lates thru Charge offs are pretty small so the folio sales are demonstrating that. ("LC says my NAR is 11.15% ... My XIRR is 9.55% ....  So my real return is between the two.")  Very impressive.
(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fi.imgur.com%2FMGvOp3p.png&hash=3a5736fa12fb6def13e041ae539bd9ab)

Here is screen shot from my excel file where I track the performance of my loans by grade.  As you can see I experience a loss rate quite a bit lower than the average based on loan grade (default rate is really loss rate for me, which includes defaults/charge offs as well as losses experienced when sold).  I think I do this via my process of loan selection as well as selling off non performing loans.  Just goes to show that you do not need to focus on higher risk loans to make a great return. 

Title: Re: Give up some numbers.
Post by: JoeB on July 22, 2014, 01:44:21 PM
Issued & Current - 18,068
A   29.70%   5366
B   34.70%   6270
C   24.10%   4354
D   8.40%   1518
E   2.20%   397
F   0.60%   108
G   0.10%   18
Those are some very interesting numbers to get 10%. Lates thru Charge offs are pretty small so the folio sales are demonstrating that. ("LC says my NAR is 11.15% ... My XIRR is 9.55% ....  So my real return is between the two.")  Very impressive.
(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fi.imgur.com%2FMGvOp3p.png&hash=3a5736fa12fb6def13e041ae539bd9ab)

Here is screen shot from my excel file where I track the performance of my loans by grade.  As you can see I experience a loss rate quite a bit lower than the average based on loan grade (default rate is really loss rate for me, which includes defaults/charge offs as well as losses experienced when sold).  I think I do this via my process of loan selection as well as selling off non performing loans.  Just goes to show that you do not need to focus on higher risk loans to make a great return.

Those are extremely impressive results. Not to over analyze this but it appears that $500k invested can generate approximately $4k per week in revenue for reinvestment. What filter specs are you utilizing which generate sufficient results to pick from; if you don't mind of course.

A friend has been using LC for a year with no defaults and I've been using his same strategy. I'm quite happy with it. I've been wondering if you can make a small hobby/business out of this with $250k to $500k and you answered my question. The only problem is to figure out the filtering strategy to generate a sufficient amount of 'safe' loans to choose from.
Title: Re: Give up some numbers.
Post by: DLIFVOIP on July 22, 2014, 04:55:00 PM
Issued & Current - 18,068
A   29.70%   5366
B   34.70%   6270
C   24.10%   4354
D   8.40%   1518
E   2.20%   397
F   0.60%   108
G   0.10%   18
Those are some very interesting numbers to get 10%. Lates thru Charge offs are pretty small so the folio sales are demonstrating that. ("LC says my NAR is 11.15% ... My XIRR is 9.55% ....  So my real return is between the two.")  Very impressive.
(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fi.imgur.com%2FMGvOp3p.png&hash=3a5736fa12fb6def13e041ae539bd9ab)

Here is screen shot from my excel file where I track the performance of my loans by grade.  As you can see I experience a loss rate quite a bit lower than the average based on loan grade (default rate is really loss rate for me, which includes defaults/charge offs as well as losses experienced when sold).  I think I do this via my process of loan selection as well as selling off non performing loans.  Just goes to show that you do not need to focus on higher risk loans to make a great return.

Those are extremely impressive results. Not to over analyze this but it appears that $500k invested can generate approximately $4k per week in revenue for reinvestment. What filter specs are you utilizing which generate sufficient results to pick from; if you don't mind of course.

A friend has been using LC for a year with no defaults and I've been using his same strategy. I'm quite happy with it. I've been wondering if you can make a small hobby/business out of this with $250k to $500k and you answered my question. The only problem is to figure out the filtering strategy to generate a sufficient amount of 'safe' loans to choose from.

As much as I would love to share my filters and picking criteria, I can not.  I do actually do this for a living.  I manage my own funds as well as have 12 other accounts I manage.  The account which I have provided the data is about 4.5years old has over $500k invested/outstanding principle, has less than 20K of loans over $50 per loan (did an experiment) and produces around 24k a month of cash flow.

So yes, it is possible to do this with large dollars and only investing "safe" loans.  You just have to give up the idea of returns over 10%, it is pretty hard to invest large dollars and have an IRR over 10% with any consistency.

Title: Re: Give up some numbers.
Post by: JoeB on July 22, 2014, 06:00:48 PM
Issued & Current - 18,068
A   29.70%   5366
B   34.70%   6270
C   24.10%   4354
D   8.40%   1518
E   2.20%   397
F   0.60%   108
G   0.10%   18
Those are some very interesting numbers to get 10%. Lates thru Charge offs are pretty small so the folio sales are demonstrating that. ("LC says my NAR is 11.15% ... My XIRR is 9.55% ....  So my real return is between the two.")  Very impressive.
(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fi.imgur.com%2FMGvOp3p.png&hash=3a5736fa12fb6def13e041ae539bd9ab)

Here is screen shot from my excel file where I track the performance of my loans by grade.  As you can see I experience a loss rate quite a bit lower than the average based on loan grade (default rate is really loss rate for me, which includes defaults/charge offs as well as losses experienced when sold).  I think I do this via my process of loan selection as well as selling off non performing loans.  Just goes to show that you do not need to focus on higher risk loans to make a great return.

Those are extremely impressive results. Not to over analyze this but it appears that $500k invested can generate approximately $4k per week in revenue for reinvestment. What filter specs are you utilizing which generate sufficient results to pick from; if you don't mind of course.

A friend has been using LC for a year with no defaults and I've been using his same strategy. I'm quite happy with it. I've been wondering if you can make a small hobby/business out of this with $250k to $500k and you answered my question. The only problem is to figure out the filtering strategy to generate a sufficient amount of 'safe' loans to choose from.

As much as I would love to share my filters and picking criteria, I can not.  I do actually do this for a living.  I manage my own funds as well as have 12 other accounts I manage.  The account which I have provided the data is about 4.5years old has over $500k invested/outstanding principle, has less than 20K of loans over $50 per loan (did an experiment) and produces around 24k a month of cash flow.

So yes, it is possible to do this with large dollars and only investing "safe" loans.  You just have to give up the idea of returns over 10%, it is pretty hard to invest large dollars and have an IRR over 10% with any consistency.

Thank you for all that. You confirmed my suspicions and $24k a month was more than I calculated but either way it would be sufficient. You certainly have a job there picking almost 1,000 loans a month.  Thanks for the info.
Title: Re: Give up some numbers.
Post by: cfb on July 22, 2014, 08:35:38 PM
So yes, it is possible to do this with large dollars and only investing "safe" loans.  You just have to give up the idea of returns over 10%, it is pretty hard to invest large dollars and have an IRR over 10% with any consistency.

My problem with figuring out rates of return is that I'm too lazy to break out the stuff I bought before I knew anything at all about p2p investing, the chunk I let lending club invest for me with the "pick a risk level" and what I bought after I educated myself more.  My 2.5 year old account is showing an adjusted LC return of just under 10%.  After looking at all the charts and data of larger accounts, seems like aside from a few outliers that are even rarer than stock market picking 'geniuses' you're getting 5-10% for long term (2-3 year old) accounts.  And the difference is almost entirely whether you picked A-B loans, C-D loans, or E-G loans.  I'm actually surprised at how many B loans I've had default with very high credit scores, long employment and very low risk evaluations.  Even some A's that were pretty blue chip rolled over.

Really annoyed at how many pulled a loan, made 0-3 payments and then declared bankruptcy.  They knew they were going to do it when they got the loan.

Just by eyeballing it, looks like my worst default was for the hunk of loans I gave them 10K to invest for me with the mid level risk band.  I think with that batch I got what everyone else passed on.

All that having been said, once you get past the loan grade and credit scores and a few other things I'm not sure all the backwards looking filtering makes that much difference after 3 years.  You just don't know what someone is going to do and trying to gauge sudden impending unemployment, illness, divorce or other major financial crisis from a credit report doesn't really work.

All in all I've been happy with my investment but I don't think I could put another 60k in without it turning into a full time job.  It was interesting to learn about, it was a bit of fun here and there, and getting 10% return on my cash for 3 years+ didn't suck.
Title: Re: Give up some numbers.
Post by: Rob L on July 22, 2014, 09:47:18 PM
In Funding - 176
Issued & Current - 18,068
In Grace Period - 83
Fully Paid - 4,525
Late 16 - 30 Days - 23
Late 31 - 120 Days - 47
Default - 2
Charged Off - 53

Grade breakdown is as follows:
A - 29.7%  B - 34.7%  C - 24.1%  D - 8.4%  E - 2.2%  F - 0.6%  G - 0.1%

If I added right that's 22,801 loans, except those in funding.
That would be a loan grade total based on the percentages of about:

A - 6771, B - 7912, C - 5495, D - 1915, E - 502,  F - 137 and G - 23

From it's inception through 3/31/2014 LC has issued the following numbers of loans:
A - 45430,  B - 88434, C - 72531, D - 42241, E - 19129, F - 8145, G - 1904

Percentage owned / ever issued is:
A - 14.9%,  B - 8.95%, C - 7.58%, D - 4.53%, E - 2.62%, F - 1.68%, G - 1.21%

Quite interesting. I very much like your approach to putting a pretty sizeable amount of money to work.

Since you are selling on Folio it's presumably not tax deferred.
How do you deal with that capital loss limitation tax problem I've read so much about?
Title: Re: Give up some numbers.
Post by: rawraw on July 23, 2014, 07:48:54 AM
So yes, it is possible to do this with large dollars and only investing "safe" loans.  You just have to give up the idea of returns over 10%, it is pretty hard to invest large dollars and have an IRR over 10% with any consistency.

My problem with figuring out rates of return is that I'm too lazy to break out the stuff I bought before I knew anything at all about p2p investing, the chunk I let lending club invest for me with the "pick a risk level" and what I bought after I educated myself more.  My 2.5 year old account is showing an adjusted LC return of just under 10%.  After looking at all the charts and data of larger accounts, seems like aside from a few outliers that are even rarer than stock market picking 'geniuses' you're getting 5-10% for long term (2-3 year old) accounts. 
That's incorrect.  You should read the discussion of NAR in the other thread.  It's a 5-10% NAR, but that is not a 5-10% return  Remember that the 2-3 year old accounts are inactive because if they were reinvesting, the age wouldn't be that high.  Remember that even YTM calculations have implicit assumptions about reinvestment into the same yield as before.   When you stop reinvesting, the number drops.
Title: Re: Give up some numbers.
Post by: DLIFVOIP on July 24, 2014, 09:23:13 AM
In Funding - 176
Issued & Current - 18,068
In Grace Period - 83
Fully Paid - 4,525
Late 16 - 30 Days - 23
Late 31 - 120 Days - 47
Default - 2
Charged Off - 53

Grade breakdown is as follows:
A - 29.7%  B - 34.7%  C - 24.1%  D - 8.4%  E - 2.2%  F - 0.6%  G - 0.1%

If I added right that's 22,801 loans, except those in funding.
That would be a loan grade total based on the percentages of about:

A - 6771, B - 7912, C - 5495, D - 1915, E - 502,  F - 137 and G - 23

From it's inception through 3/31/2014 LC has issued the following numbers of loans:
A - 45430,  B - 88434, C - 72531, D - 42241, E - 19129, F - 8145, G - 1904

Percentage owned / ever issued is:
A - 14.9%,  B - 8.95%, C - 7.58%, D - 4.53%, E - 2.62%, F - 1.68%, G - 1.21%

Quite interesting. I very much like your approach to putting a pretty sizeable amount of money to work.

Since you are selling on Folio it's presumably not tax deferred.
How do you deal with that capital loss limitation tax problem I've read so much about?

Below is a screen shot of the portfolio's page from the account that I have been providing my numbers.  The data on my average rate and loss rate was probably from the beginning of the year as I really only update that spreadsheet once a year as I can pretty much tell from the $ return each month how things are going.  You can also already see the effect on average interest rate per grade as a result of LC lowering the rates.

The "100 Test" and "50 Test" portfolios are part of an experiment I am doing to see if I only pick loans which I consider to be perfect, will they out perform how I normally pick.  It has only been about 3 months so no verdict yet.  But basically wanted to see how long it would take to get $20k invested at $100 per loan in what I considered perfect loans compared to how much I could invest at $50 per during that time, know that $10k of the $100 per loan bucket would be in the $50 per loan portfolio as well.

Anyway, here are my portfolios.  Expected payments are only adding up to $18.6k, but per my June stmt I received $24.2k. 

More than happy to keep answering questions (that I am willing to answer, lol). 

Rob -  Your numbers are pretty close on the amount of loans held.  This account has been in a very fortunate position for the last 2 - 2.5 years in that it has never ran out of cash (between new funds and the reinvestment of monthly payments), I have been able to purchase every loan that has been issued over that period that meets my criteria.  It is nice because I get to apply the data and numbers from this account to the other 12 I manage.

Yes this is not a tax deferred account, I have those also, but this is my biggest account under management.  Last year this account experienced just over $5,829 of capital losses from sales.  So $3k of it is easily covered.  The other is used to offset other capital gains or is simply a carryforward.

Title: Re: Give up some numbers.
Post by: trevor on July 24, 2014, 03:07:11 PM
Circle, I have a general question about your loan selection. Do you prefer to invest in safer notes (A-C) throughout the majority of your managed Lending Club accounts, or just mainly for your primary account that has 500k invested?


Also, when did you get the confidence to start investing large amounts of cash into P2P lending?
Title: Re: Give up some numbers.
Post by: DLIFVOIP on July 24, 2014, 05:42:00 PM
Circle, I have a general question about your loan selection. Do you prefer to invest in safer notes (A-C) throughout the majority of your managed Lending Club accounts, or just mainly for your primary account that has 500k invested?


Also, when did you get the confidence to start investing large amounts of cash into P2P lending?

Trevor,

Believe it or not interest rate is not one of my criteria in my filters I use for selecting notes.  I use other indicators to pick what I consider quality loans.  I will never not buy an A1 if it meets my requirements and at the same time I will never not buy a G5 that meets my requirements.  It just so happens that A, B and C grade loans tend to meet my requirements. 

I will say in the accounts that I manage where I am really only reinvesting payments, I will always buy the note with the highest interest rate that meets my requirements.  Meaning if I only have $25 to spend in a day, then I will try to buy the higher interest rate loan that meets my requirements. 

Managing smaller accounts and larger accounts is very different.  I strongly believe in diversification, so even though I know (based on my own data) that I make more money on B than A and C than B and D than C, etc etc, I do not believe it is worth the added risk to simply start buying larger portions of these loans.  My clients are happy with there returns and they love that they never lose money and have a steady return they can count on.  I fully explain on day one that I am not trying to hit homeruns, I like singles and doubles.

It took a bit of time before I was comfortable dealing with large dollars.  The account you guys are seeing was started in Dec 2009.  It started with $500 a month for about six months, then went to $1000 a month for a while.  At the end of 2 years and being super conservative and making over 10% (used to get deposit bonuses and interest rates were higher), it was decided that it was time to get serious.  So all the data was crunched, trends looked at and it was a big green light.  I do not want to give full details on the cash inflow, but it has been very steady for the last 2.5yrs.

I will say that right now (assuming typical volume of loans is available on LC), I am very comfortable investing an average of $1,600 - $2,000 a day at $50/loan.  If an account is not planning on having a steady stream of new funds on a monthly basis I stay at $25/loan.
Title: Re: Give up some numbers.
Post by: Rob L on July 24, 2014, 06:05:42 PM
And I was wondering how you got 30 G string, / no, scratch that /, G notes in your portfolio(s).
Must have been really slow days.
My own "unsubstantiated opinion" is that F's and G's are darts at the board.
Even LC cannot underwrite them appropriately.
Title: Re: Give up some numbers.
Post by: DLIFVOIP on July 25, 2014, 09:09:55 AM
And I was wondering how you got 30 G string, / no, scratch that /, G notes in your portfolio(s).
Must have been really slow days.
My own "unsubstantiated opinion" is that F's and G's are darts at the board.
Even LC cannot underwrite them appropriately.

I just bought a G this morning.  Again if they meet my requirements I do not care what the interest rate.  Obviously they are not as strong as the A's, B's and C's, but it is definitely not because it was a slow day.  0% return is better than a loss.
Title: Re: Give up some numbers.
Post by: hoggy1 on August 09, 2014, 08:05:24 PM
More than happy to keep answering questions (that I am willing to answer, lol). 

Hey CircleT,

I followed this post for the first couple of pages and your initial post. Can't believe this thread died so soon after you have been so forthcoming. So I have some more questions I think you might answer:

A. How much do you charge to manage an account?
B. Are the other 12 accounts you manage all P2P accounts? LC accounts? Prosper or other accounts?
C. Can you (will you) tell us how many loans (from the account you have been referring to) you have sold on Folio?
D. What is you pricing strategy for Folio sales? Do you offer deep discounts for quick sales or what?
E. Over 22.5K loans have been in this account (18K current and 4.5K fully paid). But only 208 have ever been troubled on LC (grace, late, long late, default, and write offs). That's less than 1% in any distress. But you show a table by loan grade of defaults (losses?) going from .94% for A to 7.32% for Fs. These figures include capital losses and expenses on Folio?
F. In talking about this account, you state it is about $500K and spins $24K/month in cash flow. Even if all the loans were 36 month I can't figure that cash flow for IRRs near 10%. Can you reconcile this for me?

Thats off the top of my head and ought to do for starters. This was a long thread and I am clearly not the only one interested in your story. Please pick up where we left off if you will.

Thanks,
Steve
Title: Re: Give up some numbers.
Post by: DLIFVOIP on August 10, 2014, 06:36:59 PM
More than happy to keep answering questions (that I am willing to answer, lol). 

Hey CircleT,

I followed this post for the first couple of pages and your initial post. Can't believe this thread died so soon after you have been so forthcoming. So I have some more questions I think you might answer:

A. How much do you charge to manage an account?
B. Are the other 12 accounts you manage all P2P accounts? LC accounts? Prosper or other accounts?
C. Can you (will you) tell us how many loans (from the account you have been referring to) you have sold on Folio?
D. What is you pricing strategy for Folio sales? Do you offer deep discounts for quick sales or what?
E. Over 22.5K loans have been in this account (18K current and 4.5K fully paid). But only 208 have ever been troubled on LC (grace, late, long late, default, and write offs). That's less than 1% in any distress. But you show a table by loan grade of defaults (losses?) going from .94% for A to 7.32% for Fs. These figures include capital losses and expenses on Folio?
F. In talking about this account, you state it is about $500K and spins $24K/month in cash flow. Even if all the loans were 36 month I can't figure that cash flow for IRRs near 10%. Can you reconcile this for me?

Thats off the top of my head and ought to do for starters. This was a long thread and I am clearly not the only one interested in your story. Please pick up where we left off if you will.

Thanks,
Steve

Steve,

Below are some of the answers to your questions.  Some answers may not be what you are looking for.

A.  Most actively managed funds use a fee structure of 2/20.  Meaning 2% of assets and 20% of performance.  I charge only a performance fee.  That fee is based on the amount of assets and frequency of new assets. 

B.  All accounts are LC accounts.  Some are regular taxable and some are IRA's.

C.  Thru July 2014 I have sold 1,306 loans on FolioFN.

D.  I am sorry, I will not divulge this info.

E.  The table you are referring to is not just defaults.  It is total losses.  Meaning losses on sales on FolioFN, Defaults and ChargeOffs.  Those figures include FolioFN fees.

F.  The IRR thru July 2014 is 9.55%.  I reinvest 100% of payments.  I use excel to calculate my IRR.  One column is the date the cash enters my LC account, one column is the amount deposited and finally a current date and account value.  Then I simply use the excel XIRR formula to calculate IRR. 

Adam
Title: Re: Give up some numbers.
Post by: hoggy1 on August 11, 2014, 09:07:03 AM
Thanks Adam,

Where are you located?

Do your clients tend to be local? Widely scattered?

How do clients find you? You advertise somewhere?
Title: Re: Give up some numbers.
Post by: trevor on August 11, 2014, 11:33:19 AM
Adam, out of curiosity, do you have other large investments like equities or do you feel secure having a large majority of your assets in Lending Club?
Title: Re: Give up some numbers.
Post by: DLIFVOIP on August 11, 2014, 01:10:16 PM
Thanks Adam,

Where are you located?

Do your clients tend to be local? Widely scattered?

How do clients find you? You advertise somewhere?

I would prefer not to state where I am located.  My clients are a mix of local and non local.  100% of clients are word of mouth referrals from other clients.  I do not advertise.

Title: Re: Give up some numbers.
Post by: DLIFVOIP on August 11, 2014, 01:13:38 PM
Adam, out of curiosity, do you have other large investments like equities or do you feel secure having a large majority of your assets in Lending Club?

I have other investments.  I hate the market and I am sure I will be ridiculed for that statement.  I feel secure that as long as I stick to my investment strategy I can put any amount to work in LC. 
Title: Re: Give up some numbers.
Post by: lascott on May 19, 2015, 06:33:31 PM
lenderAccountDetail.action
Quote
A: 5.9%
B: 3.2%
C: 21.4%
D: 42.2%
E: 25.5%
F: 1.8%
G: 0.1%
As & Bs - was a self-inflicted oops with a BV filter setup but at least it was using P2P-Picks!

I've gotten a bit more conservative since that last post.  Any of you folks gotten more conservative over time?

Here is my taxable account.
(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fi.imgur.com%2FqGcjg1f.png&hash=67255b47fb63df30197ac9c2e3ca21ab)
http://i.imgur.com/qGcjg1f.png

Here is my non-taxable ROTH IRA account.
(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fi.imgur.com%2Ffl7eMJD.png&hash=63ad44ea10a23a93b914992eec092d62)
http://i.imgur.com/fl7eMJD.png
Title: Re: Give up some numbers.
Post by: RaymondG on May 19, 2015, 07:50:14 PM
No. It's play money. I am chasing the return. In mid 2014, I expanded into C grade for several months. But the default rate of this C group is the same like the D group, about 4% with avg loan age 11.2 months. Apparently, my filter worked best with loans of grade D.
Title: Re: Give up some numbers.
Post by: rawraw on May 19, 2015, 08:36:30 PM
Mine looks extremely similar to your first picture, except I have 6% or so in F.
Title: Re: Give up some numbers.
Post by: RaymondG on May 19, 2015, 08:48:49 PM
I did not see anyone having commented about loan default rate by ZIP codes since ZIP# was added to the download file. Here is what is observed in my account. It's interest to see some clusters formed. The loans being analyzed are issued between 3 years and 6 months ago. Distribution among grades are: C: 12%, D: 55%, E:26%, etc. 75% were purchased after 1/2014. In the chart, "Current Score Adj" is for adjusting the score that would tighten the filter. "Lost Int rate" is estimated from $ value of total loss, earned interest, and avg interest rate. "Annualized ruin rate" estimates what number of notes were "writen-off", where total loss in number of notes is estimated from number of charged-offs, lates, and FolioFn sales. I intend to use "Annualized ruin rate" to evaluate my filter ignoring note size and improvement due to FolioFn sales. Thanks.
Title: Re: Give up some numbers.
Post by: lascott on May 20, 2015, 12:31:34 AM
I did not see anyone having commented about loan default rate by ZIP codes since ZIP# was added to the download file. Here is what is observed in my account. It's interest to see some clusters formed. The loans being analyzed are issued between 3 years and 6 months ago. Distribution among grades are: C: 12%, D: 55%, E:26%, etc. 75% were purchased after 1/2014. In the chart, "Current Score Adj" is for adjusting the score that would tighten the filter. "Lost Int rate" is estimated from $ value of total loss, earned interest, and avg interest rate. "Annualized ruin rate" estimates what number of notes were "writen-off", where total loss in number of notes is estimated from number of charged-offs, lates, and FolioFn sales. I intend to use "Annualized ruin rate" to evaluate my filter ignoring note size and improvement due to FolioFn sales. Thanks.
New thread material? I have info from Interest Radar on mine by state.
Title: Re: Give up some numbers.
Post by: rawraw on May 20, 2015, 09:23:17 AM
Yea please start a thread on this.  I'd like to do some digging as well
Title: Re: Give up some numbers.
Post by: SeanMCA on May 27, 2015, 12:15:45 AM
I went into Lending Club kind of blindly picking notes with no particular strategy and I have been amazed by how many loans have gone bad so quickly. My account is only 16 or 17 months old. The average age of my portfolio is 9 months. Not including notes "in funding", I've purchased 2,131 notes.

100ish of them have gone bad already (late, defaulted or charged off)
200ish have paid off early

These default numbers look exponentially higher than what was posted earlier in this thread by other users. Is it just because I have a terrible portfolio (although Lending Club shows me as being in the middle of the pack on the chart) or is it because everyone is selling off their bad loans on folio?

I have never used folio. My accountant was confused enough a couple months ago as it was and I didn't want to add in another element that would make things even more difficult for him to figure out. That in turn would make it more costly for him to do my taxes (offsetting whatever benefit folio might bring considering how small the value of my account is.)

The fact that almost 5% of my loans have already gone bad in the first 9 months when the average loan term of my portfolio is 4 years is frightening. And with the number of people who are rejecting their monthly ACHs (20ish at any given time are in the grace period), I'm not exactly super optimistic about the long term prospects here. My borrowers are broke right out of the gate.

I have run some analyses to spot what correlations exist between defaults and early payoffs and have been applying those theories to my picks going forward, but I wanted to get some feedback on whether you guys think I have gotten crushed or am "just average" as Lending Club indicates. My adjusted NAR is 9.40% at present.
Title: Re: Give up some numbers.
Post by: lascott on May 27, 2015, 01:07:10 AM
<snip>
The fact that almost 5% of my loans have already gone bad in the first 9 months when the average loan term of my portfolio is 4 years is frightening. And with the number of people who are rejecting their monthly ACHs (20ish at any given time are in the grace period), I'm not exactly super optimistic about the long term prospects here. My borrowers are broke right out of the gate.

I have run some analyses to spot what correlations exist between defaults and early payoffs and have been applying those theories to my picks going forward, but I wanted to get some feedback on whether you guys think I have gotten crushed or am "just average" as Lending Club indicates. My NAR is 9.40% at present.
My situation of defaulting notes is hard to analyze since I have been adding money regularly.  I am not worrying about the early payoffs. Obviously means I have to reinvest and deal with that lag but hopefully they've paid 3+ months of interest. It may indirectly mean I'm investing in responsible people and my criteria is good. Better than a default and I hope it is because they figured out another way to get rid of this debt too.

I'm curious if you have a breakdown of your defaults into % of A, B, C, D, E, F, & G as I see you are in all.
Title: Re: Give up some numbers.
Post by: SeanMCA on May 27, 2015, 01:53:31 AM
<snip>
The fact that almost 5% of my loans have already gone bad in the first 9 months when the average loan term of my portfolio is 4 years is frightening. And with the number of people who are rejecting their monthly ACHs (20ish at any given time are in the grace period), I'm not exactly super optimistic about the long term prospects here. My borrowers are broke right out of the gate.

I have run some analyses to spot what correlations exist between defaults and early payoffs and have been applying those theories to my picks going forward, but I wanted to get some feedback on whether you guys think I have gotten crushed or am "just average" as Lending Club indicates. My NAR is 9.40% at present.
My situation of defaulting notes is hard to analyze since I have been adding money regularly.  I am not worrying about the early payoffs. Obviously means I have to reinvest and deal with that lag but hopefully they've paid 3+ months of interest. It may indirectly mean I'm investing in responsible people and my criteria is good. Better than a default and I hope it is because they figured out another way to get rid of this debt too.

I'm curious if you have a breakdown of your defaults into % of A, B, C, D, E, F, & G as I see you are in all.


I'm not worried about early payoffs either. Truth be told, I'd rather be in and out of a loan as fast as possible even if that hurts my yield so if there is some science to predict which loans are more likely to pay off early, I am all for it.

Here's my breakdown of defaults by letter grade. To clarify, this is the raw number of my loans that are late, defaulted, or charged off versus the raw number of loans I have purchased for that category. For example if 1 B loan out of 10 B loans has defaulted, that would be 10%. The average age of my portfolio is 9.2 months. I have purchased 2,131 notes.

A: 0%     
B: 1.56% | 36.15 month average term | 9.62 month average age
C: 4.91% | 36.89 month average term | 9.89 month average age
D: 4.93% | 49.49 month average term | 9.08 month average age
E: 5.80% | 55.79 month average term | 8.65 month average age
F: 8.25%  | 56.90 month average term | 9.55 month average age
G: 9.43% | 59.50 month average term | 9.99 month average age

Almost 1 out of every 10 of my G notes have already gone bad in the first 10 months. The average term of my G notes is 59.5 months (They happen to  almost all be 5 year notes). So just about 10% of them are already dead at only 15% of the way in.

I realize that this might be a backwards way of looking at performance but I am starting to plan ahead for a future economic recession. If 1 out of every 10 G-risk borrowers are defaulting early on now, then what would happen if 3 or 4 out of 10 defaulted in the first 10 months? Obviously each loan is not a 100% loss, but the outlook could be pretty grim.

The ones going bad the fastest also happen to have the longest terms for me unfortunately so I'm exposed to the garbage a lot longer than the good ones. Not where I want to be. It's so hard to grab a 36 month E, F, or G note though especially now that I have all this special criteria I'm adhering to regardless of loan grade.
Title: Re: Give up some numbers.
Post by: storm on May 27, 2015, 03:12:23 AM
SeanMCA, please don't be discouraged.  If you lump all the loan grades together, 5% is the current average default rate.  Here is a good article about it. (http://www.lendingmemo.com/lending-club-prosper-default-rates/)  Also, if a loan is going to default, it is most likely going to do it within the first 8-10 months.  Read this. (http://www.lendingmemo.com/lending-club-prosper-return-curve/)  So for the first loans you invested in, if they haven't defaulted already, the majority will remain current.  Yes, it would be nice if LC could predict who is going to default in the first few months of the loan and deny them, but I don't think that is entirely possible.

For a long while, I sold my IGP and late loans on Folio, but it was becoming very time consuming as my investment has grown.  I stopped back in February.  My return has managed to tick up a bit since then.  YMMV.
Title: Re: Give up some numbers.
Post by: SeanMCA on June 06, 2015, 11:06:59 PM
I think it's healthy to regularly question the numbers anyway. The sheer number of defaults is eye opening. Lots of bankruptcies and disappearing consumers who are never heard from again after a couple of payments.

Historically, 80% of the notes that I've ordered have been issued. But that number dropped recently to below 40% and for an entire two week period, I had more notes enter the 16-30 days late category than I was able to buy. They're actually defaulting faster than I can pick them up.

And the Grace Period category is continuing to swell. I don't think I can buy new ones fast enough to outpace the ones likely to move from Grace Period to 16-30 days late.

I am mostly giving up on high risk notes and shifting to As and Bs.
Title: Re: Give up some numbers.
Post by: Lovinglifestyle on June 07, 2015, 03:17:36 PM
Mine are also going late faster than they are issuing, and the overall total dropped as well due to a rash of early payoffs a week ago.  The total issued and current climbed by only 6 in the last week, whereas the late count climbed by 19.  But this is Sunday, and on Tuesday the numbers seem to change a lot.
Title: Re: Give up some numbers.
Post by: AnilG on June 07, 2015, 03:32:43 PM
Loan defaults are part of normal lending business, you can't avoid defaults. My concern is the timing of such defaults. Sooner loans default, larger fraction of original lent amount is lost. Frequent occurrence of such defaults indicate problems in Loan Origination Process. Recently, there appears to be rash of loans defaulting quickly on Lending Club.

Mine are also going late faster than they are issuing, and the overall total dropped as well due to a rash of early payoffs a week ago.  The total issued and current climbed by only 6 in the last week, whereas the late count climbed by 19.  But this is Sunday, and on Tuesday the numbers seem to change a lot.
Title: Re: Give up some numbers.
Post by: Lovinglifestyle on June 07, 2015, 09:46:33 PM
Loan defaults are part of normal lending business, you can't avoid defaults. My concern is the timing of such defaults. Sooner loans default, larger fraction of original lent amount is lost. Frequent occurrence of such defaults indicate problems in Loan Origination Process. Recently, there appears to be rash of loans defaulting quickly on Lending Club.

Mine are also going late faster than they are issuing, and the overall total dropped as well due to a rash of early payoffs a week ago.  The total issued and current climbed by only 6 in the last week, whereas the late count climbed by 19.  But this is Sunday, and on Tuesday the numbers seem to change a lot.

WOW!  I see what you mean!  Hmm.  I wondered how I got so lucky as to have 13/14 issued on one order on May 18.  Makes me a little nervous instead of a lot glad now.  I noticed on your site that my orders issued/orders placed ratio in the past 30 days is 78%, vs. the usual 60% or less.
Title: Re: Give up some numbers.
Post by: Fred on June 08, 2015, 02:54:21 AM
Recently, there appears to be rash of loans defaulting quickly on Lending Club.

Can you please  quantify:
1. recently: past N quarters, weeks, days
2. rash: increased by  x%
3. quickly: defaulting in month n
Title: Re: Give up some numbers.
Post by: RazzleDazzle on June 08, 2015, 04:21:51 PM
A Velocity graph may be? Interesting inference nonetheless if true.
Title: Re: Give up some numbers.
Post by: lascott on June 08, 2015, 04:53:36 PM
Recently, there appears to be rash of loans defaulting quickly on Lending Club.

Can you please  quantify:
1. recently: past N quarters, weeks, days
2. rash: increased by  x%
3. quickly: defaulting in month n
I think he was trying to show that by providing the graph. Every couple weeks he saw his daily return drop. % on vert and dates on horiz.

http://i.imgur.com/e7285Sa.png
(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fi.imgur.com%2Fe7285Sa.png&hash=4b8be03e9bbcbd87756ba65b59bcc16f)

His graph explanation from his site:

Quote
How to interpret Daily and Rolling 30-Day Returns Chart?

* Typically, daily return curve will have small fluctuations around 0%. These fluctuations are result of daily changes in portfolio value. These changes can be result of payments received or notes being charged off or secondary market transactions.

* The large negative peaks of daily return curve typically indicate the remaining principal being written off due to charged off loans. While loans being charged off is part of consumer lending, users may want to pay attention to the frequency of such charge offs and magnitude of impact on daily return. Large frequent fluctuations may indicate underlying issues with loan selection criteria and/or changes in credit underwriting.

* The Rolling 30-Day Return curve shows the change in portfolio value over 30-day period. This curve will always show 0% for first 30 days as PeerCube starts calculating rolling 30-day returns from 31st day.

* The Rolling 30-day Return curve is a good visualization for the monthly returns of user's portfolio and the impact of charge offs on monthly returns. The sharp drop in monthly return curve and subsequent time period for recovery is a good indicator of impact on the monthly returns.

* The displayed returns assume that no external funds were added to nor internal funds withdrawn from portfolio. As PeerCube doesn't receive information about fund transfer to and from account using Lending Club API, we are unable to adjust displayed returns for cash inflow and outflow.

* Users may be able to identify cash inflows and outflows as unusually large positive and negative peaks on the chart. In addition, PeerCube caps daily and rolling 30-day returns to +/-10% to lessen the impact of large cash inflow and outflow in visualizing return data.
Title: Re: Give up some numbers.
Post by: kya on June 08, 2015, 06:51:09 PM
for what its worth i have also (for the first time in three years) started to buy more A,B and C notes. I have experienced the same recent trend of very quick defaults only 2-3 payments in on D,E,F & G notes no matter how good they looked when purchased. I am now also requiring a 700 plus fico score minimum. What is concerning is my LC account has far more deliquincy than my Prosper account currently. I have been buying with very similar filters and the accounts have almost the same number of notes so Im starting to believe Prosper is doing a better job underwriting right now. It also seems like many more delinquint notes pay there way back to current status on prosper rather than just tumbling down the delinquint chute to default status on LC. I am watching close and wonder since going public if LC isnt cutting corners for volume sake.
Title: Re: Give up some numbers.
Post by: SeanMCA on June 08, 2015, 10:39:05 PM
I am watching close and wonder since going public if LC isnt cutting corners for volume sake.

Just about every lender I've ever witnessed firsthand that was under pressure to produce volume has cut corners on underwriting. I don't think LC would be any different. Unfortunately nobody is that honorable.
Title: Re: Give up some numbers.
Post by: SeanMCA on June 08, 2015, 10:44:24 PM
Also there's a saying in the b2b lending world. It's easy to lend money. The only thing that matters is being able to get it back.

Lending Club isn't under as much pressure to collect, just originate. It's incredibly easy to find people who want money. Immensely easy (doesn't mean they're all qualified). Let's not pat Lending Club on the back for volume when the only thing that matters is underwriting and collections. Any startup with money to burn can find borrowers.
Title: Re: Give up some numbers.
Post by: nonattender on June 09, 2015, 11:27:46 AM
Also there's a saying in the b2b lending world. It's easy to lend money. The only thing that matters is being able to get it back.

Lending Club isn't under as much pressure to collect, just originate. It's incredibly easy to find people who want money. Immensely easy (doesn't mean they're all qualified). Let's not pat Lending Club on the back for volume when the only thing that matters is underwriting and collections. Any startup with money to burn can find borrowers.

Actually, it tooks years for LC to hone their marketing channels to be not only high volume but cost efficient. I know what you're saying,
I see all of the new entrants burning irrational dollars on $15/click Adwords that are grossly unsustainable, but LC has lots of channels.

(That's one of the very important things that all of the "fine, fine - but LC's business doesn't have a moat" people do not understand...)
Title: Re: Give up some numbers.
Post by: AnilG on June 09, 2015, 05:49:05 PM
You will need to wait until Lending Club releases historical loan performance data and payment data.

My observations are based on daily variations in account value of different users (similar to the chart I posted before). What stood out in the posted chart are the frequent significant drop in account values in April-May and impact on portfolio value. These drops were not result of cash withdrawals from account. These drops not only wiped out all the gains from previous month but also took gains from next 6 weeks just to recover loss in portfolio value. Scott post does a good job for the source of the chart and potential interpretation.

Can you please  quantify:
1. recently: past N quarters, weeks, days
2. rash: increased by  x%
3. quickly: defaulting in month n
Title: Re: Give up some numbers.
Post by: AnilG on June 09, 2015, 06:21:27 PM
Do you have information on the marketing channels used by Lending Club? What channels do they use?

IMO, only marketing channels used by Prosper and Lending Club that are not accessible to other platforms are their own borrowers for refinancing and exclusive referral partnerships such as Sam's Club and community banks. Lending Club recently announced roll out of the small business financing through Sam's Club. They are offering 20% discount in origination fee to member requesting loan through Sam's Club. I am also aware of how discount superstores like Costco squeeze the vendors for referral fees for Costco referral programs for cars, kitchen remodeling, and appliances etc, I doubt these referral leads are "cheap" in any way for Lending Club.

Just an hypothetical example for brain gymnastics: Origination fees on LC business loans is 1 - 6% without referral, that is $1,000 - $6,000 for $100,000 loans. The referral lead from Sam's Club at 20% discount to borrower already costing $200 - 1,200 on such loans. I doubt Sam's Club taking less than 20-30% of origination fee as referral fee for each successfully issued loan, i.e. another $200 - 900 referral fee to Sam's Club. I would guess fees for referral leads are the major portion of borrower acquisition cost, doesn't matter who is originating loans.

My understanding is that most platforms including Lending Club use variety of marketing channels including online advertising (adwords, banner ads, referral ads), lead generation sites such as Credit Karma, direct mailing, tv and print ads, and users checking their interest rates on platform and affiliate websites. You might get an idea of marketing channels used by different platform and their effectiveness by looking at marketing channel codes in Prosper historical data.

The borrower lead generation is very interesting business, more qualified the leads more expensive the leads. Some borrower lead generation vendors use auction style system. There are lot of scammy operations in this space. I can't find the source but there was an article in one of the publications (WaPo, NYT) about the underbelly of borrower lead generation business. There are hundreds of sites (credit repair, quick loans, etc) online whose sole purpose is to capture enough information about you to request credit check and then auction off the leads based on quality. The article mentioned how the unsold leads get sold to scammers who buy such leads for $10-50 per 1000 leads.



Actually, it tooks years for LC to hone their marketing channels to be not only high volume but cost efficient. I know what you're saying,
I see all of the new entrants burning irrational dollars on $15/click Adwords that are grossly unsustainable, but LC has lots of channels.

(That's one of the very important things that all of the "fine, fine - but LC's business doesn't have a moat" people do not understand...)
Title: Re: Give up some numbers.
Post by: SeanMCA on June 10, 2015, 01:08:15 AM
In the business lending space, buying a good "lead" can cost a lender or broker $200 (or more). And that's just for information collected on a website. The odds of reaching that business by phone or email is low and the odds of them turning into a closed deal is lower. http://www.bloomberg.com/bw/articles/2014-09-02/larry-king-s-business-loans-will-cost-you

The online lead gen business is huge. The Larry King campaign was run by an Internet lead gen company. They did no lending themselves.

Less than a year ago I believe Prosper's Ron Suber said in front of a conference audience that until recently they were almost entirely dependent on direct mail. I found that shocking but I believe that's still the bread and butter for consumer lending.

Title: Re: Give up some numbers.
Post by: nonattender on June 10, 2015, 03:27:28 PM
In the business lending space, buying a good "lead" can cost a lender or broker $200 (or more). And that's just for information collected on a website.

In consumer, prime-ish, the metric is CPFL (cost per funded loan), and you'll note that cost is tied to the lead being funded ("listed", for
LC, though as 100% of the listings fund, it's functionally equivalent).  One starts to see pay-per-lead as one goes past around 600 fico,
though the payperleads for a sub-600 consumer are nowhere near the $200 (or more) levels, commensurate w/small xaction amounts.

Less than a year ago I believe Prosper's Ron Suber said in front of a conference audience that until recently they were almost entirely dependent on direct mail. I found that shocking but I believe that's still the bread and butter for consumer lending.

Ever since CreditKarma (Chris Larsen's rather genius leadgen op, which he funded while running Prosper) started doing TV, they're big
player in the online leadgen game.  Especially as they have such transparency into each consumer's file and can target vs scorecard of
any platform partner, effectively guaranteeing that their users will only see offers for which they will actually qualify = huge conversion.

That's one company I'd absolutely love to own as they are sitting on a pile of data - and sit in the middle btwn consumers and finance,
effectively just letting the platform run and arbing the cost of credit pulls for x consumers against value of same taking financing offers.

BTW, you quasi-randomly liked something I posted today, another site, re: SPLP...  Very funny when I made connect;  I like debanked!

(And god bless you, finance have happened to us lately, jesus will provide, we just got ouf of hospoital, we are desperate; fund now!)