Lend Academy Network Forum

General Category => General P2P Lending Discussion => Topic started by: brother7 on July 17, 2014, 06:40:51 PM

Title: What TERM loan do you invest in?
Post by: brother7 on July 17, 2014, 06:40:51 PM
When I first started investing, it didn't matter.
After more research, I learned that 60-month loans have a greater chance of default so I started to favor 36-month loans.
Now, all of my new note purchases are 36-month only.
Title: Re: What TERM loan do you invest in?
Post by: rawraw on July 17, 2014, 07:08:42 PM
When I first started investing, it didn't matter.
After more research, I learned that 60-month loans have a greater chance of default so I started to favor 36-month loans.
Now, all of my new note purchases are 36-month only.
Of course they do, because they have more time.  The question is whether the increased rate they have is enough to mitigate this risk or not.

I'm about 70% 36 and 30% 60.  P2P Picks is all 36 months and then I do some filters on 60 months.
Title: Re: What TERM loan do you invest in?
Post by: Emmanuel on July 17, 2014, 09:11:31 PM
It's not so much that the default rate is higher, since rates can compensate for that, but that the defaulting loans stop paying comparatively sooner..

The graphs below show the probabilities of defaulting loans to stop paying, for each month until maturity. Highest risk is at the 11th month for 36-months loans and 13th month for 60 months loans, so respectively at around 1/3 of maturity for 36-months loans but only 1/5th for 60-months loans. Therefore if a 36-months and a 60-months loss both default, the loss will be greater on the second one.
Title: Re: What TERM loan do you invest in?
Post by: Fred on July 17, 2014, 09:21:47 PM
Below are charts from latest LC 10-Q:
http://www.sec.gov/Archives/edgar/data/1409970/000119312514201360/d706350d10q.htm

(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fwww.sec.gov%2FArchives%2Fedgar%2Fdata%2F1409970%2F000119312514201360%2Fg706350p35.jpg&hash=932476cf6d3a2cb0df4d3175af3c0230)

(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fwww.sec.gov%2FArchives%2Fedgar%2Fdata%2F1409970%2F000119312514201360%2Fg706350p42.jpg&hash=abd7a285fcf4cdadfb10f420429655c7)
Title: Re: What TERM loan do you invest in?
Post by: Peter on July 19, 2014, 08:58:39 AM
I am about the same ratio as Rawraw. I prefer 36-month but we need to keep in mind that the first 60-month loans won't reach maturity until early next year. So, it will be a while before we will be able to compare apples with apples.
Title: Re: What TERM loan do you invest in?
Post by: lascott on July 19, 2014, 10:20:12 AM
I'm current in 36 mo @ 87.6% and 60 mo @ 12.4% per https://www.lendingclub.com/account/lenderAccountDetail.action pie chart using the TERM option.

I'm mainly done P2P-Picks for the 36ers and LendingRobot for the 60ers.

A couple older articles about this:
Title: Lending Club Loan Length and Default Rate - Posted by Anil Gupta on June 21, 2012
http://andirog.blogspot.com/2012/06/lending-club-loan-length-and-default.html?_sm_au_=iVV0FRJfT30QRPjr
Title: Lending Club Loan Length: Best 60 month spread with B4 Grade Loan - Posted by Anil Gupta on June 25, 2012
http://andirog.blogspot.com/2012/06/lending-club-loan-length-best-60-month.html
Title: Lending Club Loan Length - Credit Grades and Default - Posted by Anil Gupta on June 28, 2012
http://andirog.blogspot.com/2012/06/lending-club-loan-length-credit-grades.html


Title: Balancing Your Portfolio by Loan Term 36/60 Month - Posted by Nickel Steamroller on June 7, 2012
http://www.nickelsteamroller.com/blog/2012/06/balancing-your-portfolio-by-loan-term-3660-month/

LendingClub page, https://www.lendingclub.com/public/60-month-notes.action , states 60s are good because of higher interest and lower fees.
(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fi.imgur.com%2FKLGEfC1.png&hash=37da1d9f19c9c92a900c33f7490e1d9e)
Title: Re: What TERM loan do you invest in?
Post by: SBryantMS on July 19, 2014, 11:53:29 AM
I am 86% (36 month) and 14% (60 month) notes.

I stopped buying 60 month notes as my loss rates were triple my 36 month note per Interest Radar. 

My early defaults in the 60 month notes increased my principal loss to unacceptable levels.

I don't believe that the higher interest rate on 60 month notes properly compensates for the additional principal loss. 

I ONLY buy 36 month notes now.
Title: Re: What TERM loan do you invest in?
Post by: AnilG on July 19, 2014, 12:22:10 PM
My current portfolio split is 54% 36 month (age 15.12  months) and 46% 60 month (age 5.31 months) loans. Earlier this year, I switched to buying 60 month loans or to put more appropriately ignoring loan term in my loan selection.
Title: Re: What TERM loan do you invest in?
Post by: alimoyni on July 19, 2014, 12:27:30 PM
I very recently started to buy notes on Folio that have < 15 months remaining on the loan term and they have had perfect loan payments during the loan.    This has given me a mixture of 36 and 60 month loans and typically in the B/C range. 
Title: Re: What TERM loan do you invest in?
Post by: lascott on July 19, 2014, 12:30:49 PM
My current portfolio split is 54% 36 month (age 15.12  months) and 46% 60 month (age 5.31 months) loans. Earlier this year, I switched to buying 60 month loans or to put more appropriately ignoring loan term in my loan selection.
What?!?!  Had you done further research ... because your 2012 findings were not that favorable (I pointed to above)?
Since I haven't been around that long I'm guessing that LC has changed how they assign grades and interest to 60's since they first started.
Title: Re: What TERM loan do you invest in?
Post by: AnilG on July 19, 2014, 05:53:29 PM
I did some research earlier this year for an institutional client. I don't believe LC has made any adjustments between 36 and 60 month loans. The high interest rate loan pool is primarily made of 60 month loans so it is very difficult to avoid them if you want to play in high interest rate loan sandbox.

My current portfolio split is 54% 36 month (age 15.12  months) and 46% 60 month (age 5.31 months) loans. Earlier this year, I switched to buying 60 month loans or to put more appropriately ignoring loan term in my loan selection.
What?!?!  Had you done further research ... because your 2012 findings were not that favorable (I pointed to above)?
Since I haven't been around that long I'm guessing that LC has changed how they assign grades and interest to 60's since they first started.
Title: Re: What TERM loan do you invest in?
Post by: turing on July 21, 2014, 12:57:24 PM
I am 60% 60 month and 40% 36 month.

The model I am working on shows that the higher interest rate you earn with 60 month notes more than compensates for any risk.
Title: Re: What TERM loan do you invest in?
Post by: rockinray on July 24, 2014, 08:42:06 AM
Currently, I am 90% 36 and 10% 60.

I am considering an 80/20 split to see how the allocation will perform.

Ray
Title: Re: What TERM loan do you invest in?
Post by: JoeB on August 10, 2014, 01:53:10 PM

I'm about 70% 36 and 30% 60.  P2P Picks is all 36 months and then I do some filters on 60 months.


I am about the same ratio as Rawraw. I prefer 36-month but we need to keep in mind that the first 60-month loans won't reach maturity until early next year. So, it will be a while before we will be able to compare apples with apples.

Question: in all of your writings and filterings, you do not sort for term. 60 month notes are probably 2/3 of the platform and therefore around the same for your filters. How can it be that you are at 70% 36 month notes? Did I miss something?
Title: Re: Re: What TERM loan do you invest in?
Post by: rawraw on August 10, 2014, 02:08:00 PM

I'm about 70% 36 and 30% 60.  P2P Picks is all 36 months and then I do some filters on 60 months.


I am about the same ratio as Rawraw. I prefer 36-month but we need to keep in mind that the first 60-month loans won't reach maturity until early next year. So, it will be a while before we will be able to compare apples with apples.

Question: in all of your writings and filterings, you do not sort for term. 60 month notes are probably 2/3 of the platform and therefore around the same for your filters. How can it be that you are at 70% 36 month notes? Did I miss something?
P2P picks only selects 36 months. So my automated investments through that service ignores the 60.  It's a built in filter. Then I randomly turn on my filter for sixty month only
Title: Re: Re: What TERM loan do you invest in?
Post by: JoeB on August 10, 2014, 02:26:37 PM

I'm about 70% 36 and 30% 60.  P2P Picks is all 36 months and then I do some filters on 60 months.


I am about the same ratio as Rawraw. I prefer 36-month but we need to keep in mind that the first 60-month loans won't reach maturity until early next year. So, it will be a while before we will be able to compare apples with apples.

Question: in all of your writings and filterings, you do not sort for term. 60 month notes are probably 2/3 of the platform and therefore around the same for your filters. How can it be that you are at 70% 36 month notes? Did I miss something?
P2P picks only selects 36 months. So my automated investments through that service ignores the 60.  It's a built in filter. Then I randomly turn on my filter for sixty month only

I'm sorry, my question was directed towards Peter who agreed with your statement.
Title: Re: Re: Re: What TERM loan do you invest in?
Post by: rawraw on August 10, 2014, 02:28:55 PM

I'm about 70% 36 and 30% 60.  P2P Picks is all 36 months and then I do some filters on 60 months.


I am about the same ratio as Rawraw. I prefer 36-month but we need to keep in mind that the first 60-month loans won't reach maturity until early next year. So, it will be a while before we will be able to compare apples with apples.

Question: in all of your writings and filterings, you do not sort for term. 60 month notes are probably 2/3 of the platform and therefore around the same for your filters. How can it be that you are at 70% 36 month notes? Did I miss something?
P2P picks only selects 36 months. So my automated investments through that service ignores the 60.  It's a built in filter. Then I randomly turn on my filter for sixty month only

I'm sorry, my question was directed towards Peter who agreed with your statement.
He uses the same service
Title: Re: Re: Re: What TERM loan do you invest in?
Post by: JoeB on August 10, 2014, 02:37:48 PM

I'm about 70% 36 and 30% 60.  P2P Picks is all 36 months and then I do some filters on 60 months.


I am about the same ratio as Rawraw. I prefer 36-month but we need to keep in mind that the first 60-month loans won't reach maturity until early next year. So, it will be a while before we will be able to compare apples with apples.

Question: in all of your writings and filterings, you do not sort for term. 60 month notes are probably 2/3 of the platform and therefore around the same for your filters. How can it be that you are at 70% 36 month notes? Did I miss something?
P2P picks only selects 36 months. So my automated investments through that service ignores the 60.  It's a built in filter. Then I randomly turn on my filter for sixty month only

I'm sorry, my question was directed towards Peter who agreed with your statement.
He uses the same service

This is his strategy with no mention of further filtering. To the contrary, he emphasizes the use of his filters as shown:
http://www.lendacademy.com/investing-in-lending-club-and-prosper-in-2013/ (http://www.lendacademy.com/investing-in-lending-club-and-prosper-in-2013/)
  http://www.lendacademy.com/investing-lending-club-prosper-2014/  (http://www.lendacademy.com/investing-lending-club-prosper-2014/)
Title: Re: What TERM loan do you invest in?
Post by: lascott on November 09, 2015, 09:41:28 AM
Below are charts from latest LC 10-Q:
http://www.sec.gov/Archives/edgar/data/1409970/000119312514201360/d706350d10q.htm

(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fwww.sec.gov%2FArchives%2Fedgar%2Fdata%2F1409970%2F000119312514201360%2Fg706350p35.jpg&hash=932476cf6d3a2cb0df4d3175af3c0230)

(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fwww.sec.gov%2FArchives%2Fedgar%2Fdata%2F1409970%2F000119312514201360%2Fg706350p42.jpg&hash=abd7a285fcf4cdadfb10f420429655c7)

Below are charts from a recent LC 10-Q -- the quarterly period ended March 31, 2015
http://www.sec.gov/Archives/edgar/data/1409970/000162828015003709/lc-2015xq1.htm

Image: http://i.imgur.com/iMczeEu.png
(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fi.imgur.com%2FiMczeEu.png&hash=7aeba9d9d4391383b6cbc835cececab4)
Title: Re: What TERM loan do you invest in?
Post by: pourts on February 05, 2016, 06:48:00 PM
I have a hypothesis that as more investors become comfortable with this asset class, the expected returns will decrease.  This has happened over the last few years, and I think it will continue.  Based on this hypothesis, I am increasing my allocation towards 5 year notes in order to "lock in" more favorable notes and limit reinvestment risk.

However, I am a relative novice in this game.  Any thoughts on this strategy?
Title: Re: What TERM loan do you invest in?
Post by: michael49 on February 06, 2016, 01:38:16 PM
Most of the replies to this topic are almost 2 years old now, I would be curious to know if people's strategy on this has changed at all.
I have traditionally invested mostly in 36 month notes but I recently started a portfolio using bluevestments bluepicks aggressive filter and about 75% of the notes it has selected are 60 month notes. 
Title: Re: What TERM loan do you invest in?
Post by: RaymondG on February 06, 2016, 01:44:20 PM
To me, whatever notes passed my complex filter will be purchased automatically. I focus on D,E,F, so the ratio of 36 vs 60-month in my portfolio is about 20:80 naturally. The charts of Net cumulative Lifetime Charge-off Rates have bias since 36-month loans are mostly A,B,and C loans which should have lower default rate.
Title: Re: What TERM loan do you invest in?
Post by: PhilGD on February 06, 2016, 03:05:31 PM
I was term-agnostic up until recently. Beginning this year I've decided to invest in 36-month term loans only, as a means to protect against interest rate risk. Another factor is that in back testing, the model I use for 60 month loans is weaker than my 36 month model, so I think I can have more success in the 36m arena.
Title: Re: What TERM loan do you invest in?
Post by: Fred93 on February 06, 2016, 03:09:25 PM
My filters would naturally select more 60 than 36.  To bias this back toward 36, I apply slightly tighter filter criteria to 60 month loans, so the 60 month loans theoretically have a little higher credit quality, to compensate for the risks of holding them longer (such as the risk that the borrower's credit situation will change over time).  Portfolio has about 60% of 60 month loans.
Title: Re: What TERM loan do you invest in?
Post by: heikkie on February 11, 2016, 10:07:36 PM
The filter I used show much more 60 month than 36 month
Later I change it to 36 month only, if i search it once a week (random time in a week), about 1-8 loan will show up.
Title: Re: What TERM loan do you invest in?
Post by: Rob L on February 12, 2016, 10:48:23 AM
I am about the same ratio as Rawraw. I prefer 36-month but we need to keep in mind that the first 60-month loans won't reach maturity until early next year. So, it will be a while before we will be able to compare apples with apples.

FWIW, we now have a year of fully completed 60 month loans to study and compare with 36 month loans of the same vintage (apples to apples).
Using NSR to back test loans issued 01/01/2010 through 12/31/2010 the ROI was 6.41% for ALL 60 month loans and 5.88% for ALL 36 month loans.
Title: Re: What TERM loan do you invest in?
Post by: lascott on February 12, 2016, 01:55:01 PM
I am about the same ratio as Rawraw. I prefer 36-month but we need to keep in mind that the first 60-month loans won't reach maturity until early next year. So, it will be a while before we will be able to compare apples with apples.

FWIW, we now have a year of fully completed 60 month loans to study and compare with 36 month loans of the same vintage (apples to apples).
Using NSR to back test loans issued 01/01/2010 through 12/31/2010 the ROI was 6.41% for ALL 60 month loans and 5.88% for ALL 36 month loans.
Stands to reason.

Title: Earn More Interest: 60-Month Loans
https://www.lendingclub.com/public/60-month-notes.action
Quote
Earn 3.82% more interest on average
By investing in 60-month loans, you can earn more interest while diversifying your investment portfolio beyond 36-month loans. To enjoy the longer repayment term of 60 months, borrowers with the same credit profile and loan amount are modified by 4 to 8 grades. They pay a higher interest rate, so most people can earn from 2.62% to 5.03%2 more interest.
See how we set interest rates
Title: Re: What TERM loan do you invest in?
Post by: fliphusker on February 27, 2016, 09:05:05 AM
First off let me say, I have not invested a penny in LC, yet.  Wanted to get all down with my nerdy self before making any kind of investment.  So am reading about anything I can get my eyeballs on about it.
What I seem to be missing in this thread is if people are using the same filter for the 2 terms they are purchasing.  Have to use different filters for the 2 different terms.  Unless your OK with not maximizing potential earnings.  Guess do not want a program to invest my money in things such as the following. 
With playing with a filter today it spat out a quite nice D1 note.  The person was pretty buried in CC debt, but his 15k/month salary would help out quite a bit.  But the odd thing was, he was a stagehand.  Top stagehands, according to Google, make around 50k.
Another one where the person was a vault custodian and was making oddles.
Title: Re: What TERM loan do you invest in?
Post by: Rob L on February 27, 2016, 12:54:49 PM
What I seem to be missing in this thread is if people are using the same filter for the 2 terms they are purchasing.

My guess is that they are using the same selection criteria. However ...

Think I've read most of the stuff here on the forum over the past couple of years and can't remember seeing this question discussed. That's zero, zip, nada. I've always limited myself to 36 month loans and haven't given it much thought. It would be interesting to hear from others that do invest in both 36 and 60 loans and whether or not they use a different selection criteria for each. If different criteria are used what are they? If not has anyone actually done the work and determined there's little or no difference? Of course asking these questions is asking folks to disclose a lot of information (secret sauce) that came through their own hard work. If I had done all the work to find these answers I probably wouldn't share them.
Title: Re: What TERM loan do you invest in?
Post by: PhilGD on February 27, 2016, 01:44:41 PM
What I seem to be missing in this thread is if people are using the same filter for the 2 terms they are purchasing.

My guess is that they are using the same selection criteria. However ...

Think I've read most of the stuff here on the forum over the past couple of years and can't remember seeing this question discussed. That's zero, zip, nada. I've always limited myself to 36 month loans and haven't given it much thought. It would be interesting to hear from others that do invest in both 36 and 60 loans and whether or not they use a different selection criteria for each. If different criteria are used what are they? If not has anyone actually done the work and determined there's little or no difference? Of course asking these questions is asking folks to disclose a lot of information (secret sauce) that came through their own hard work. If I had done all the work to find these answers I probably wouldn't share them.


60 month loans consist of lower credit-quality borrowers, which is a good reason to use different criteria in selecting 60 month loans vs 36 month loans. A borrower who selects a 60 month loan is probably going after the lower payment associated with that longer term. This means that the borrower's disposable income might be very tight. And we know that income is one of the best predictors of default.

For those reasons, I use a different regression model to grade 60 month loans than I do for 36 month loans. And in backtesting, I get better results this way (compared to building just one model for both 36 and 60 month loans).
Title: Re: What TERM loan do you invest in?
Post by: Rob L on February 27, 2016, 05:24:08 PM
For those reasons, I use a different regression model to grade 60 month loans than I do for 36 month loans.

That was exactly one of the questions I had in mind; one model with a 36/60 term parameter or two models.
Thanks for the insight!
Title: Re: What TERM loan do you invest in?
Post by: Small Fish Big Pond on February 28, 2016, 10:53:19 AM
I'm 100% 36, with not intention to look at 60. It seems the more you read and research about 60's the more you want to stay away from them. I would rather continually reinvest in 36's with slightly less ROI, than take the risk with 60's. I thought read something about LC doing 72 and increasing max loan amounts, that would be scary. If I'm a borrower and my mindset is too payoff a CC and I want to extend the term to 60, I'm really not focused on paying it off, just lowering my payment so I can charge more, with 36 I believe people are focused on paying down their debt quicker. These are just my opinions of course but I understand this mentality as I have dealt with it my professional life for 18 years sitting down and talking to people face to face.
Title: Re: What TERM loan do you invest in?
Post by: Fred93 on February 28, 2016, 01:19:46 PM
I'm 33% 36 mo, 67% 60 mo.  I prefer the lower risk of the shorter loans, but have come to accept the mix.  I recently started using a tighter filter on the 60 mo loans, to bring the fraction of 60 mo loans down a little.
Title: Re: What TERM loan do you invest in?
Post by: Fred on February 28, 2016, 01:55:00 PM
If you are open to selling and buying on Folio, 60-mo loans are attractive.
Title: Re: What TERM loan do you invest in?
Post by: lascott on February 28, 2016, 02:16:26 PM
I'm 100% 36, with not intention to look at 60. It seems the more you read and research about 60's the more you want to stay away from them. I would rather continually reinvest in 36's with slightly less ROI, than take the risk with 60's. I thought read something about LC doing 72 and increasing max loan amounts, that would be scary. If I'm a borrow and my mindset is too payoff a CC and I want to extend the term to 60, I'm really not focused on paying it off, just lowering my payment so I can charge more, with 36 I believe people are focused on paying down their debt quicker. These are just my opinions of course but I understand this mentality as I have dealt with it my professional life for 18 years sitting down and talking to people face to face.
Regarding underlined text. Fred had quite an interesting (and surprising to me) post in another thread a few days ago.

The second questionable thing here is "9 months". Loans are either 36 or 60 months, not 9 months, and what you care about is the final disposition of the loan, not where it will be part-way through.
This is actually not too questionable.
Using Payment history data, the average life of 36-mo loans is 17.8 months, while the 60-mo loans is ~14 months.
"life" = from origination until paid off or charged off.

(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fi.imgur.com%2F1QRthCC.png&hash=f81d49d5baf69a91c3df9eb86f624794)
Title: Re: What TERM loan do you invest in?
Post by: Small Fish Big Pond on February 28, 2016, 02:37:41 PM
I'm 100% 36, with not intention to look at 60. It seems the more you read and research about 60's the more you want to stay away from them. I would rather continually reinvest in 36's with slightly less ROI, than take the risk with 60's. I thought read something about LC doing 72 and increasing max loan amounts, that would be scary. If I'm a borrow and my mindset is too payoff a CC and I want to extend the term to 60, I'm really not focused on paying it off, just lowering my payment so I can charge more, with 36 I believe people are focused on paying down their debt quicker. These are just my opinions of course but I understand this mentality as I have dealt with it my professional life for 18 years sitting down and talking to people face to face.
Regarding underlined text. Fred had quite an interesting (and surprising to me) post in another thread a few days ago.

The second questionable thing here is "9 months". Loans are either 36 or 60 months, not 9 months, and what you care about is the final disposition of the loan, not where it will be part-way through.
This is actually not too questionable.
Using Payment history data, the average life of 36-mo loans is 17.8 months, while the 60-mo loans is ~14 months.
"life" = from origination until paid off or charged off.

(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fi.imgur.com%2F1QRthCC.png&hash=f81d49d5baf69a91c3df9eb86f624794)

Good catch lascott, would like a better breakdown of paid vs charge off on Fred's sample, also grades would also be helpful in the breakdown.
Title: Re: What TERM loan do you invest in?
Post by: michael49 on February 28, 2016, 04:29:10 PM
...

Good catch lascott, would like a better breakdown of paid vs charge off on Fred's sample, also grades would also be helpful in the breakdown.

+1 on that - paid vs charge off is a rather big difference. :)
Title: Re: What TERM loan do you invest in?
Post by: Fred on February 28, 2016, 05:53:59 PM
Good catch lascott, would like a better breakdown of paid vs charge off on Fred's sample, also grades would also be helpful in the breakdown.

Here is the average life by term, final status, and grade.

(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fi.imgur.com%2FUMxEPMM.png&hash=e891a27a552aaaeec2b19c9ce613274b)

Notes:
1. I did not use the latest payment data -- have not had to do this, but if anyone has the latest payment data, you can simply do this too.
2. I used a slightly different query than my prior table, so results are different, but the above table should be more accurate.
Title: Re: What TERM loan do you invest in?
Post by: Small Fish Big Pond on February 28, 2016, 08:29:39 PM
Good catch lascott, would like a better breakdown of paid vs charge off on Fred's sample, also grades would also be helpful in the breakdown.

Here is the average life by term, final status, and grade.

(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fi.imgur.com%2FUMxEPMM.png&hash=e891a27a552aaaeec2b19c9ce613274b)

Notes:
1. I did not use the latest payment data -- have not had to do this, but if anyone has the latest payment data, you can simply do this too.
2. I used a slightly different query than my prior table, so results are different, but the above table should be more accurate.

Great stuff Fred, as I suspected 60's avg life paid / charged off historically have shorter avg life which then makes you wonder how the ROI still out performs the 36's. I understand the 60's have greater initial return due to principal vs interest ratio. This is more evidence while I will continue to stockpile 100% 36's. I do like the idea of taking an existing 60 on folio with great history with only 36 left, but unless you can buy it right, the yield might not be worth the investment.
Title: Re: What TERM loan do you invest in?
Post by: lascott on February 28, 2016, 09:27:16 PM
Good catch lascott, would like a better breakdown of paid vs charge off on Fred's sample, also grades would also be helpful in the breakdown.

Here is the average life by term, final status, and grade.

(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fi.imgur.com%2FUMxEPMM.png&hash=e891a27a552aaaeec2b19c9ce613274b)

Notes:
1. I did not use the latest payment data -- have not had to do this, but if anyone has the latest payment data, you can simply do this too.
2. I used a slightly different query than my prior table, so results are different, but the above table should be more accurate.

I think a few more years of stats for mine to be valid (sample/count of loans too small).

Mine from my 2 years worth of ~7000 notes (extended download)

Image: http://i.imgur.com/UuwxxB8.png
(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Fi.imgur.com%2FUuwxxB8.png&hash=4b0d685c99f44c3f3133f886f0a8d375)

My SQL is here: http://www.lendacademy.com/forum/index.php?topic=3620.msg32758#msg32758
Title: Re: What TERM loan do you invest in?
Post by: fliphusker on March 15, 2016, 10:57:41 AM
80-20 for a 60-36 split.  Just not enough notes for 36 month hit my filtering, so will take the longer term and keep my fingers crossed. 
Title: Re: What TERM loan do you invest in?
Post by: Small Fish Big Pond on March 17, 2016, 10:10:55 AM
80-20 for a 60-36 split.  Just not enough notes for 36 month hit my filtering, so will take the longer term and keep my fingers crossed.

That must be a strong filter, what notes are you focusing on?
Title: Re: What TERM loan do you invest in?
Post by: fliphusker on March 17, 2016, 04:17:05 PM
0 Inquiries, c,d,e,f,g, income, public records, delinquencies, DTI, exclude Arizona, Cali, Fla, Nevada, home ownership and mortgage, debt consolidation and credit cards only.  I am just a small fry though, and will only grab up to 16 loans/month. 
If I was going to do larger amounts, absolutely would have to change my filters. 
Title: Re: What TERM loan do you invest in?
Post by: Small Fish Big Pond on March 17, 2016, 04:19:49 PM
0 Inquiries, c,d,e,f,g, income, public records, delinquencies, DTI, exclude Arizona, Cali, Fla, Nevada, home ownership and mortgage, debt consolidation and credit cards only.  I am just a small fry though, and will only grab up to 16 loans/month. 
If I was going to do larger amounts, absolutely would have to change my filters.

So you are not using a managed filter like Bluevestment?
Title: Re: What TERM loan do you invest in?
Post by: fliphusker on March 17, 2016, 05:10:35 PM
I set up filters at lending robot.  Thought I had it set up right, was sorely mistaken.  Sitting on 60 notes at 36 months of A and B.  Guess if any consolation, they were free and should be fairly safe.  :(
So will just hand pick my notes from now on, as too skiddish to make the same mistake again. 
Title: Re: What TERM loan do you invest in?
Post by: Small Fish Big Pond on March 17, 2016, 05:19:34 PM
I set up filters at lending robot.  Thought I had it set up right, was sorely mistaken.  Sitting on 60 notes at 36 months of A and B.  Guess if any consolation, they were free and should be fairly safe.  :(
So will just hand pick my notes from now on, as too skiddish to make the same mistake again.

I understand, I use BV and it's very user friendly and have been very happy. It sounds like you are not doing a lot of note purchases so doing your own screening will probably work out fine. I am currently sitting on 2100 notes and could never look at that many listings, set it and forget it with BV.
Title: Re: What TERM loan do you invest in?
Post by: fliphusker on March 17, 2016, 05:40:44 PM
Ya, if I was dealing with the large quantity of notes that you are, my filters would have to change dramatically just to reduce cash lag.  Plus controlling that kind of cash flow, would be a must to auto select.
I am pretty excited though to see my first payment to be made on the 1st.  (Knock on wood). 
I will check out BV though, in case I become I high roller.  :P
Title: Re: What TERM loan do you invest in?
Post by: Small Fish Big Pond on March 17, 2016, 05:53:44 PM
Welcome to P2P lending, now sit back and watch that account grow!!!!