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Messages - jrl

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Investing - General (not P2P) / Re: REITs vs Real Estate Crowdfunding
« on: August 10, 2020, 01:54:02 AM »
Are you precious metals allocation ETFs? That's one big gap in my portfolio. I wish there was a way to share an image on this portfolio, I could share my allocation image.

Nah, they're physical. Not part of any tax-advantaged account.

The premiums are crazy high right now as inventory/supply is low:

Even the buyback prices on some sites are higher than spot.

BTW - You can upload images to and post the link to the image. That seems to work well enough.

Investing - General (not P2P) / Re: REITs vs Real Estate Crowdfunding
« on: August 08, 2020, 03:40:32 PM »
I've been looking for a place to chat with investors that are investing outside of the stock market.

Yeah, it's extremely frustrating. Everyone seems to be a stock market casino cheerleader these days.

I'm currently looking for other alternatives since with Folio gone I'll need something else to invest my Roth IRA in.

Current allocation: 23% precious metals, 12.5% cash, 12.5% LC, 6% Crypto currencies, and the balance (46%) is in traditional managed retirement accounts.

The 8-14% return from Folio is going to be hard to beat.

Investors - LC / Re: My hardship loan experience
« on: August 02, 2020, 05:39:46 AM »
LC also added a "View hardship notes only" checkbox on the notes page. I think it's just the recent Covid-related notes because none are charged off. In any case, it shows I have 92 total, 13 Paid, 3 IGP, 1 Late 16-30, and 2 Late 31-120. (Out of 4,182 notes, of which only 1,242 are current, 39 IGP, 11 Late 16-30, and 22 Late 31-120 with 782 C/O)

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

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

Recoveries from my taxable account:

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

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

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

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

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

Good luck out there.

Investors - LC / Re: My hardship loan experience
« on: July 30, 2020, 10:12:28 PM »
Why is someone in hardship if they can gather up the money to pay off the whole loan? I'm sure there are many reasons and theories.

They're likely taking hardship withdrawals from their retirement accounts to reduce their monthly debt payments. People I'm working with are taking these withdrawals due to the waiver of the 10% penalty, regardless of whether they really need it or not. I also have friends and relatives in different industries doing the same. The ones paying off their loans with it are smart; it's better in the long run to pay off debt with interest rates of 10% or more, than to earn 6% or less and possibly lose money in this casino of a stock market.

Investors - LC / Re: hardship fields in spreadsheet wrong
« on: May 08, 2020, 08:47:14 PM »
Just so you know, I noticed the issue (but not in the spreadsheet) in early April, so it's been like this for over a month now:,21636.msg61755.html#msg61755

Initially, they did show up as IGP, then they got converted to "Deferred" (I guess) as the borrowers called in and asked for it.

Since last month I can confirm that my month over month earnings from the account that I'm winding down have went from around 6-8% yearly to negative 2%. Though because the notes are listed as "current" my ANAR has gone up by around 0.2 percentage points, and my implied APR (based on LC's adjustment) has gone up 3 percentage points, from 8% APR to 11%.

My other account has shown even "better" numbers, due to purely Folio reinvestment since I lost primary market access in September. (It's still turning a profit.)

In both accounts I'm seeing notes get converted from IGP and late to current ("deferred") just about every day. Though some of these accounts have been making payments before the end of the deferral term.

My guess is that they're attempting to hide this from retail. My expectation is around 3-6 months of near break-even (for me) returns, then a higher than normal amount of late notes converting into charge-offs around year-end before a return to normal returns (for these older notes) in the new year. I would expect just like in other hard times that the new notes being issued in the next few months will have much better returns than we've seen in the past few years.

Investors - LC / Re: Crisis management - stop charge-offs ?
« on: April 01, 2020, 09:05:16 PM »
Two of my notes just popped into IGP with next payments scheduled in May. Both missed their late March payment.

It appears they're just doing a few months of deferred payments.

Apparently all 3 payments are on the date of their normal May payment. No additional interest.

Nothing out of the ordinary in the call log, it states: "4/1/20 (Wednesday)    Inbound Call (BR) - No Pay - Claims Hardship"

So basically the same thing as if they did nothing, except maybe no hit to their credit report for being prudent enough to call ahead? I'm assuming if they don't call they'll take a hit on their credit report at some point?

This action should seem reasonable to the average borrower, although it appears they need to call to put this in motion. They'll probably wind up having to extend this. Hopefully the borrowers get back to a financial situation where they're able to pay.

There were attempts to call the borrowers back after those calls, with no answer, so I'm assuming the decision was made in the last few hours.

Update/Edit: The two notes are now Current, with it saying "Deferred" in the payment status column for their March and April payments. The Next Payment Date is now listed as the day before their normal May/June payment, and the payment amount is now their normal monthly payment. Nothing more in the collection log. No indication of any of this in the notes_ext file yet. I was able to find 20 total out of my 1560 current+late notes with deferred payments and due dates over 30 days away. Half kept their IGP/Late status. My IGP/Late rate still looks normal.

Foliofn - LC / Re: Folio API stopped working since yesterday
« on: April 01, 2020, 02:37:42 PM »
Regarding LC I've become a well known perma-cynic. They have never been transparent on these things.

LC Folio could go the Prosper way for all we know.
Why is it thought the API is down by fault rather than intent and why think it will be restored? They have so much bigger fish to fry.

They just bought a bank before banks crashed. My uninformed speculation is they must have vastly overpaid as compared to today's valuations.
Can they get out of the deal or renegotiate? Their idea was good but massively overtaken by events (extremely unfortunate and not of their making).

My theory is not backed up with any financial / balance sheet analysis at all and may be totally off base.
Anybody who has a better ground truth, or at least an opinion with some numerical analysis, please set me straight.

AFAIK the bank they bought wasn't heavily invested in risky derivative assets like the major multi-national banks. Assuming it's just a normal bank with mortgages and small business loans, they should be doing fine.

The credit scores aren't updating.

Confirmed. I will also email them and ask. Furthermore, I'll tell them that the secondary market seems to be down.

Fixed! Finally!

They added 2 data points to (most of) the charts, but both say 3/20, since they differ on some notes and last_credit_pull_d is 3/30/20, I'm just going to assume it's mid-month and 3/30/20. I'm going to have to keep a lookout to see if it's now end-of-month instead of mid-month going forward.

Now I get to spend the rest of the week buying notes! lol

Investors - LC / Re: Crisis management - stop charge-offs ?
« on: March 22, 2020, 07:04:15 PM »
Perhaps I am confused.  But "charge-off" to me means something like "time to sell the debt."  Wondering if there is any guidance from LC as to what that means...?  And be nice to know exactly when in the default process the loans disappear off our books forever.

In any case, a whole lot of folks that are now or in the near future losing jobs/paychecks/businesses are gonna need quite some time to recover. Would love to hear directly from LC as to their plan for dealing with this.

"Charge-off" to LC in practice means that the borrower is behind by 4 principal payments by mid-month or the end of the month. If a borrower makes a payment when it's in default, but it only covers the interest portion, it will still charge-off.

I have yet to see any loans come out of  "charge-off" status, even though I've had a few that have fully recovered. They get counted as a loss for the full principal amount at the time of charge-off, but stay on the books for years at a zero-value. Theoretically it's possible to get a recovery years after a charge-off, I have a few charge-offs that pay a few dollars every now and then. The only negative is the amount of fee LC charges on those recoveries.

The credit scores aren't updating. I've previously brought this issue up with LC and they told me they now update bi-monthly.

Visual representation of the issue: The charts are two different random notes, one from my account, and one listed on folio.

Well, it's been two months and one week since the last update, and they still haven't updated.

So I emailed LC about this on Tuesday, and they responded "The credit scores should update in the next two days." on Wednesday. I have asked again this evening and still haven't received a response.

I think they're not taking this issue seriously because nobody else is noticing, because none of the automated systems would pick it up. The only values shown on the SecondayMarketAllNotes file are "CreditScoreTrend" and "FICO End Range" but if you look at the notes_ext or traded_notes_ext files there's a value labeled last_credit_pull_d which is the date the last credit score was pulled/updated.

When you think about it, every single note on folio currently shows a "credit score trend" that ends two months ago, which previously updated in the middle of every month. Any note could literally have went from a prime credit score to an extremely high risk score last month, or even the month before, and would still be listed with a flat or up trend. Obviously this problem gets exponentially worse the longer it persists.

I understand many here are trying to liquidate their accounts, and I would LOVE to buy your notes (that meet my criteria), but until the scores update I'm reluctant to buy a single note!

I'm currently sitting here with 15% of my account in cash because of this, hoping more people will raise this issue. It's frustrating.

Given the rate at which LC is reducing allocation to the retail market, I can't imagine that they would allocate $ toward lawyers to get one state back online for retail investors.

It was a few states, NY being one of the biggest.

FWIW, the population of the states with no access to the LC primary market currently accounts for a third of the US population. This includes the 2nd, 3rd, 4th, 5th, 7th, 9th, 14th, 37th, 48th, and 49th most populated states. As far as I'm aware, Ohio (#7) and Pennsylvania (#5) never had access to the primary market.

Presumably, that means that around a quarter of LC's customers were kicked off the primary market in the fall.

Again, not getting my hopes up, but NY is 4th most populated state, with nearly 6% of the US population. TX, NY, and FL together represent over 1/5 of the US population. That means over 20% less profit/revenue from the retail segment if this keeps up.

Also: Payments on weekends? The banks are closed, no?

So now there's account activity every day, not just Business Days. Interesting...

General P2P Lending Discussion / Re: Lending Club Is A Bank
« on: February 20, 2020, 09:12:40 PM »
Fred, I think they meant institutional debt providers, not purchasers of loans
Without a portfolio of loans, LendingClub will have extreme volatility of earnings. Balance sheet interest income will mitigate that issue a bit

All the talk over the years about "skin in the game" regarding their underwriting. Now they will have it!

They still get to decide which loans they'll hold, and which ones they'll offer up to others.

This is only a positive development for the stockholders IMO.

Looks like LC has been busy!

1st change: A notice about Hardship Payments was added to the corresponding notes:

This borrower has had an unexpected life event and has entered in a hardship plan. Hardship plans can be either short-term (ranging 3 - 12 months) or long-term (permanent) with the obligation that the borrower continue to make regular monthly payments at a lower payment amount. At the end of the short-term plan a borrower will revert to paying their original payment amount.

As seen here:

Which is confusing, because Hardship was only supposed to be 3 months max. IIRC extending duration was a regulatory issue. It appears they've made a major change with no notice or explanation. Although the effect doesn't sound very much different from the "3rd party contacted Payment Solutions specialist and agreed to pay a settled amount" Collection Log note. Hopefully this brings down Charge Offs.

2nd change: Instead of reporting a late loan's next payment as the total amount to bring the loan current, LC now reports the next payment as the regular monthly payment.

3rd change: Notes that are in the 31-120 days late category and make payments are now reclassified properly based on payments. I had a few notes that went from being "31-120 days late" on Saturday to "16-30 days late" on Sunday. (No payments are credited or registered on weekends or holidays.)

4th change: Loans now go IGP immediately after missing a payment, instead of taking "3-5 business days", this is more in line with the action taken a year ago to credit payments on the day they're made.

5th issue: Late Wednesday Night/Thursday (Not sure on exact timing, but on charge-off days notes usually charge off soon after the day's payments come in.) marked the first time I've ever seen notes charge off before the 15th of the month, aside from when the 15th falls on a weekend. (In this case charge offs should've happened Friday Night)

6th issue: Stale Credit Scores: This is once again a problem.,21603.0.html I hope this is not a trend, as it makes folio note buy/sell decisions difficult.

7th issue: Aside from it now taking forever to load a note's payment history/performance page, a few notes simply refused to load and instead redirected to over the weekend. It appears they're no longer redirecting, but still take over 90 seconds to load.

6 & 7 are major issues IMO, though they may just be related to the maintenance, hopefully they'll be resolved soon.

5 is kinda weird, not sure what happened there, maybe they needed to get that done early to devote manpower to these other changes?

The rest, IMO, seem like long overdue changes. Maybe (Hopefully?) a sign of more interest in keeping retail customers. Though 6 & 7 take away from the positives of 1-4. Also, 4 seems to make ANAR appear lower, though it seems to be somewhat negated by 3.

Also, I thought today was a holiday, (President's Day) but I just had a few more notes with Sunday (2/16) payment dates go IGP while typing this up? Strange, it was holiday for LC last year..

Anything I've missed?

Investors - LC / Re: LC is ending whole-loan note sales next week
« on: January 24, 2020, 09:23:32 AM »
I suspect the volume on the retail market will be kept just under the demand on the market. If you go around buying up 50% of every loan that hits the market, I suspect they'll issue more fractional notes to offset that. Like it is currently, there's always a few notes available, they just usually don't meet our criteria.

I suspect LC has some kind of criteria that looks at cash balances and investor behavior in order to try and create demand for these less-than-desirable (to a majority of the retail market) notes. IMO their algorithms appear to be garbage to us, but they're probably behaving as expected from LC.

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