Worst Month Yet

[Jessica King]

I am sorry to hear this. Yes, I think diversification is one of the most important factors to consider to reduce risks as this one.

[JDII]

Sad to see everyone preparing to leave. It's been a fun ride

I'm staying.  My account is nothing like some of yours in regards to size but I'm building it. 

[Rob L]

It's time for a fire sale:



Only a little over $500 outstanding principal; considerably sooner than expected.
Higher charge offs than projected. I lost about $25 this month. Percentage wise it was truly the worst month ever, but money wise it was nothing.
Only about 250 notes now "un-dead". I should be able to blow them out on Folio manually and plan to discount them to whatever makes them go away.
About half are B grade so some decent bargains should pop up for the Folio Hawks. The rest are D's & E's; I'll probably have to give them away.
Fine with me; I just want to be done .. done before the end of the year.

[lctz]

Interesting read.  Somehow I experienced better returns.  Most of my loans are B and C.  I started around 2015 with two accounts.  One is a testing account that I used to test various of models; the other is my main account controlled by stable models after I feel comfortable with my models.
My main account has return about 5.6% and test account about 4.6%.  I am starting to test secondary market models.  I'll share some of my model predicted secondary loan prices later.

[rawraw]

I don't know about Rob specifically, but a lot of posters used to chase yields and that caught up to them. My account of B and C notes that started at the beginning of the deterioration has performed fine. I reduced my taxable account to zero though. Got sick of dealing with taxes once my losses exceeded the deductible amount

[Rob L]

Interesting read.  Somehow I experienced better returns.  Most of my loans are B and C.  I started around 2015 with two accounts.  One is a testing account that I used to test various of models; the other is my main account controlled by stable models after I feel comfortable with my models.
My main account has return about 5.6% and test account about 4.6%.  I am starting to test secondary market models.  I'll share some of my model predicted secondary loan prices later.

Well, here's where I stand today; Combined, Primary, Traded notes and Cumulative Profits.
It hasn't been all bad; just since mid-2016 when the fraud was exposed and I decided to quit.

[Rob L]

I don't know about Rob specifically, but a lot of posters used to chase yields and that caught up to them. My account of B and C notes that started at the beginning of the deterioration has performed fine. I reduced my taxable account to zero though. Got sick of dealing with taxes once my losses exceeded the deductible amount

Yeah, I was certainly chasing yield big time before I decided to quit LC. It was the thing to do until it wasn't.
IMO even today every LC investor is chasing yield, some more some less. However there isn't as much "more" as there once was. 

[lctz]

Well, here's where I stand today; Combined, Primary, Traded notes and Cumulative Profits.
It hasn't been all bad; just since mid-2016 when the fraud was exposed and I decided to quit.

Your return is not bad at all given current CD rate floats around 2%.

[rawraw]

Yes that is true if LC is viewed as fixed income. A lot of posters were investing here instead of equities, however.

[Rob L]

My fire sale is mostly complete. I sold 200 notes mid-day Sunday. Anyone here buy any of them?
There were about 9 notes that were 31-120 late that I had to discount 95%. Who am I to argue with the market but that was a bit more than expected. I was thinking 85% - 90% would have been right.

[lctz]

95% discount of the principal is about right.  Around 30% of late loans don't pay a penny.

[Rob L]

Liquidity has value. In more active markets it's the called the bid-ask spread.
In my case I "hit the bid" so to speak and more than gladly paid the bidder for the liquidity provided.
The notes sold had from 1-4 payments remaining and I wanted to be rid of them now.
The bidder had a longer time horizon and will almost certainly profit from them (or from a "many like them" strategy applying law of large numbers).
I would have taken the other side of my trades, as did the buyer, if my own time horizon were longer.

[Rob L]

I'm down to 26 notes on my Folio sell page. Of those 7 are run of the mill "in processing".
The remaining all show 0 payments remaining and less than $0.10 outstanding principal. Most show $0.00 outstanding principal.
Anyone know what's going on with them and how long it will take them to go away?

[Debt Free]

Wondering the same thing.  I just sold the last note on two IRA's.  One shows $0.00 principal outstanding and 11/9/19 was supposed to be the last payment, but it now shows another payment owing in December.  Guessing some errant interest in the amount of something like $0.00032.

[Rob L]

If a note has > $0.01 outstanding principal I can list it for $0.01 and it will be bought.
If a note has $0.01 outstanding principal I can list it but it will not be bought.
If a note has $0.00 outstanding principal I cannot even list it!
Why are there rules that prevent me from giving notes away for an asking price of $0.00 if I so choose?