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Messages - storm

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1
Investors - LC / Re: Post-News IRA Strategy
« on: October 17, 2020, 03:32:52 AM »
I don't want to pay $50 for ever $1000 withdrawn, and I don't want tens of thousands of dollars accruing in cash in LC, earning nothing.  So, $10,000 increments seemed about right.
Also, I didn't want to leave cash in LC if they are going through such big changes.  I just don't trust them that much.

You can transfer/withdraw the cash from your LC account to your Strata account and earn a little interest. It isn't much, but it is better than the nothing LC pays.

2
Investors - LC / Re: RIP Lendingclub Notes
« on: October 11, 2020, 05:31:59 PM »
Here's another interesting question.  After the platform closes down for new investments and five years goes by, presuming 5% of these notes charge off, how long will your accounts remain active to collect any charge off recoveries?  Among my accounts, I have two that have drawn down to zero with no active notes.  I still receive recoveries each month of a couple dollars.

Will LC maintain our accounts for another 15 years or buy out the charged off debt from us?

After 5 years of note issuance, LC has no obligation to give you any recovered amount:

Quote
In the event that LendingClub receives payments on a member loan corresponding to an investor’s Note after the final maturity date, such investor will not receive payments on that Note after the final maturity date.

Each three-year Note will mature on the initial maturity date, unless any principal or interest payments in respect of the corresponding member loan remain due and payable to LendingClub upon the initial maturity date, in which case, the maturity of the three-year Note will be automatically extended to the final maturity date (which in no event shall exceed five years from the initial maturity date). If there are any amounts under the corresponding member loan still due and owing to LendingClub on the final maturity date (for three-year or five-year Notes), LendingClub will have no further obligation to make payments on the related Notes, even if it receives payments on the corresponding member loan after the final maturity date.

3
Investors - LC / Re: Post-News IRA Strategy
« on: October 08, 2020, 03:46:53 PM »
I just closed out my LC IRA, but if I still had it, I would look at my returns minus the annual fee versus paying income tax on an early withdrawal and transferring the notes to a taxable LC account. Normally there is a 10% IRS penalty for early withdrawal, but there are several additional exceptions this year due to Covid. You can also give up your notes, but I don't think that qualifies as a capital loss when it's inside an IRA. If it was a Roth IRA, then I wouldn't have to worry about taxes.

Strata charges a lot of miscellaneous fees that ate into the relatively small amount of money I had invested, so it was not worth continuing to do business with them. If I was more wealthy and wanted to put the money in more exotic investments, it might be worthwhile to stick with Strata. There are many brokerages that no longer charge fees or commissions, so it was just a no-brainer to transfer the funds to one of them. Just my 2 cents.

4
Investors - LC / Re: Lending Club potential new offerings
« on: August 28, 2020, 10:17:01 PM »
I was not targeted by this survey.

I hate to be a Debbie Downer, but LC has neglected its retail investors for years (website hasn't been updated, secondary marketplace shut down, poor loan availability and underwriting, etc.). I just don't see myself reinvesting in the LC ecosystem without some giant incentive. How can LC compete with an index fund or ETF from one of the many discount brokerages with no commissions? Considering we have double-digit unemployment in this country right now, I just don't think it is wise to invest in consumer lending either.

5
Investors - LC / Re: Folio ending August 28th.
« on: August 20, 2020, 12:40:57 PM »
Thank you.  Were they basing the 10K on balance in notes only or did it include cash?  Almost all my holding is in cash waiting to be withdrawn at this point.

Notes.

6
Investors - LC / Re: Folio ending August 28th.
« on: August 19, 2020, 11:31:34 PM »
How do you know when your fee is due?  I've never had to pay before, I'd like to give the duds as long as possible to pay off before having to take that IRS penalty (but still not pay the annual fee for what will probably be $50 in outstanding notes).

It will be on the anniversary of when you opened your account. Lending Club emailed a reminder e-mail about 3 months in advance since my investment has fallen below $10k.

7
Investors - LC / Re: Folio ending August 28th.
« on: August 12, 2020, 03:47:37 AM »
Folio closing creates an issue for me. I don't know how I can exit from  LC without paying that annual fee.

My next annual fee is not for nearly 10 months, so it's a long way off, but, with folio closing whatever is going to happen is going to happen THIS month.

I have listed every note that had a maturity date later than my next annual fee, and they have been selling pretty well. There's only two particularly stubborn notes left with poor payment histories, I'm sure eventually I'll discount them enough someone will buy them. I hope... in the next week. The rest of my notes will all mature before the fee.

EXCEPT FOR the "hardship" notes that I can't sell. There are only a couple of them with maturity dates after my annual fee--but if even ONE note is left? Then my account doesn't close and I'm going to have to pony up $100/year or whatever it is until that final notes pays off? I'll be paying $100/year for the privilege of holding what will be by then $5 or $10 note.

There has to be a way out.

I've been reading past comments from investors who have already made their exit. When you call to close your account, you can either forfeit your leftover notes to LC (along with the remaining principle and interest) or transfer them to a taxable LC account. If you transfer them from a traditional (pre-tax) IRA, the IRS will tax the fair market value as income plus a 10% penalty if you are younger than 59 1/2. Then hope those borrowers get their act together. I already have a taxable account I'm letting die off naturally, so that may be the way I go.

8
Investors - LC / Re: Folio ending August 28th.
« on: August 09, 2020, 12:41:14 AM »
I've spent the better part of this year slowly and strategically liquidating my remaining notes in my IRA before the annual fee hits me later this year. I'm down to just a handful of notes with terrible payment histories. I consider myself lucky. I feel sorry for anyone who wants out now.

9
I did a partial transfer in May.  Within my LC account, I withdrew the funds to Strata.  I filled out the transfer forms on Vanguard's website, printed them out, and mailed them off without being notarized.  About a week later, Strata said they mailed the check to Vanguard.  Vanguard shows they received it a week later, and then it was another week before the funds were available for investing.  Took about a month in all.  Fee for partial transfer was $25.  Not sure how that affects taxes.  I'm thinking it probably won't.

10
Investors - LC / Re: Tax treatment of lending club
« on: May 30, 2019, 08:04:53 AM »
I think you have a good grip on how LC is taxed.  Some things to think about:

  • If you have a lot invested, the interest income can bump you into a higher tax bracket.
  • If you have a lot invested and since LC does not withhold taxes, you can be in for a nasty surprise come tax season unless you adjust your W-4.
  • If you invested in stocks/mutual funds/real estate instead and held on to it for over a year, you have the advantage of them being taxed at the more favorable long-term capital gains rate.
  • I think the unhappiness really stems from a combination of having a large amount of write-offs (bad loans), little to no capital gains to offset, and having to roll over the losses into another year because of the $3k cap.
   

11
Investors - LC / Re: 1099 Spreadsheet for Accountant
« on: May 16, 2019, 02:09:26 AM »
LC lets you download your tax forms in PDF or XLS format.  XLS is Excel format.  You might supply both to your accountant and let them use whatever they prefer.  Neither require a password to open.

12
Foliofn - LC / Re: investor fee
« on: January 08, 2019, 11:34:40 AM »
1% fee is taken from all borrower payments no matter how you acquired the note.

13
I hate to sound like a Debbie Downer, but the retail marketplace is on the decline.  We make up 7% of LC's business now and falling.

This forum used to be much more active, but LC got greedy and sold investors a bunch of bad loans in the last few years.  Many of us old timers have or are in the process of winding down our portfolios because of the lackluster returns and unfavorable tax treatment.  My returns have been looking a little better the last few months despite no new investments, but only time will tell if LC can be trusted again.

FolioFN is strictly a take it or leave it marketplace.  No bidding.

For calculating returns, the XIRR function in spreadsheet software (Excel, Google Sheets, etc.) is probably the best method.  Peter has a blog entry about it here:  https://www.lendacademy.com/different-ways-to-calculate-p2p-lending-returns/

14
Investors - LC / Re: Is LC no longer interested in retail investors?
« on: October 07, 2018, 08:16:05 PM »
From the latest available SEC filings, 7% of loan origination funding came from self-directed/retail investors and falling. (source:  https://www.lendacademy.com/roundup-of-q2-2018-earnings-greensky-ondeck-lendingclub/)  LC hasn't cared about the retail investor in a long time, IMHO.  CD rates are very close to outpacing my LC returns, and it just isn't worth my time hunting down new loans to invest my idle cash.  There was a time when I really liked the steady returns and security of this investment and told everyone I knew about it.  I wish I could find something similar where they gave a crap.

15
Investors - LC / Re: Worst Month Yet
« on: July 06, 2018, 11:33:16 AM »
Another good LC month. Starting to look more like 5% to 6% reality rather than a statistical fluctuation.
My delinquency rate has been down the past 6 months. Another positive indicator.

Really?  I'm investing in mostly B's and C's, and I'm hovering around a 4% annualized return.  Charge-offs have been steady since February (about .5%/month of my total portfolio).

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