Author Topic: Question about Loans Paid Early  (Read 5690 times)

ktrdsl23

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Question about Loans Paid Early
« on: January 07, 2016, 11:18:22 AM »
I wanted to take a look at how I was doing on loans that are paid early.  I moved all of my loans that were paid off early to a new portfolio and it appears that I received $8799 of payments on an investment of $8350.   Assuming no fees that would be a return of 5.3% of course I can't ignore fees.  Is there any simple way for me to determine the amount I lost to fees on this?  I realize the fees will be different if they were paid off a month into the loan vs. a month before the final payment but perhaps there is something quick and dirty I can do to get an approximation.

Thanks.

Fred

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Re: Question about Loans Paid Early
« Reply #1 on: January 07, 2016, 05:32:33 PM »
perhaps there is something quick and dirty I can do to get an approximation.

You can use "1% of payment received" as a quick estimate of service fees.  In your case, about $87.99.

Also, When borrowers prepay their loans during the first 12 months after a Note is issued, LC limits the size of the service fee charged to investors. 

See https://www.lendingclub.com/public/rates-and-fees.action for details.

ktrdsl23

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Re: Question about Loans Paid Early
« Reply #2 on: January 08, 2016, 09:42:55 AM »
perhaps there is something quick and dirty I can do to get an approximation.

You can use "1% of payment received" as a quick estimate of service fees.  In your case, about $87.99.

Also, When borrowers prepay their loans during the first 12 months after a Note is issued, LC limits the size of the service fee charged to investors. 

See https://www.lendingclub.com/public/rates-and-fees.action for details.

Thanks.  Seems a pretty good return for me then.  All my loans are under one year at this point so assuming my fees are less than 1% it seems my net return is better than 4.3% for very short term loans.  Who said we were in a low interest rate enivronment  :)

GS

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Re: Question about Loans Paid Early
« Reply #3 on: January 09, 2016, 10:13:07 PM »
In order to get a real idea of how loans paid off early compare to your returns, you'd have to annualized the return .... Otherwise, 4.3% does really tell you much ...

Perhaps a way to approximate it a little closer .... If you can get an average of how many months a note is held before it pays off -lets say the average is 6 months - Then is likely that prepaid notes are giving you an annual return of about 8 percent.

It's complicated a bit more because LC waives the 1% fee on larger than normal payments during the first year, so hypothetically, if you pay 1 cent on a 1 dollar monthly payment for five months, then get a $23 payment to pay off the note, you still only pay one cent on that last payment, for a total of 6 cents in fees on $28 in payments ...

Lovinglifestyle

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Re: Question about Loans Paid Early
« Reply #4 on: February 23, 2017, 08:37:38 PM »
perhaps there is something quick and dirty I can do to get an approximation.

You can use "1% of payment received" as a quick estimate of service fees.  In your case, about $87.99.

Also, When borrowers prepay their loans during the first 12 months after a Note is issued, LC limits the size of the service fee charged to investors. 

See https://www.lendingclub.com/public/rates-and-fees.action for details.

Decided to bump this thread instead of starting a new one about the above link that doesn't work right now.  About a month ago when I tried, it did.  The "Risks" page is also empty.
Anybody have a link to rates and fees that works, or know how long it's been blank?  Thanks.

Fred93

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Re: Question about Loans Paid Early
« Reply #5 on: February 23, 2017, 08:46:54 PM »
Decided to bump this thread instead of starting a new one about the above link that doesn't work right now.  About a month ago when I tried, it did.  The "Risks" page is also empty.
Anybody have a link to rates and fees that works, or know how long it's been blank?  Thanks.

The above link works for me.  Suggest you try it again.

jheizer

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Re: Question about Loans Paid Early
« Reply #6 on: February 23, 2017, 08:48:35 PM »
Agreed. Works here too.
Replacement to P2P Quant's Percentile Tool http://lc.geekminute.com

Lovinglifestyle

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Re: Question about Loans Paid Early
« Reply #7 on: February 23, 2017, 09:20:34 PM »
Under the title "Rates and Fees" do you get an empty white box (as do I)?  Or do you get the breakdown of grades and sub-grades with their current interest rates in the box (as I used to)?  I tried the link several times from different places before posting--can't imagine why there aren't any colors, grades, and numbers in the box!

Fred93

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Re: Question about Loans Paid Early
« Reply #8 on: February 23, 2017, 09:27:16 PM »
The box is not empty. 

Perhaps you need to clear your browser cache or restart your browser or try a different browser or something of that sort.

Lovinglifestyle

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Re: Question about Loans Paid Early
« Reply #9 on: February 23, 2017, 09:43:28 PM »
The box is not empty. 

Perhaps you need to clear your browser cache or restart your browser or try a different browser or something of that sort.


Thank you so much!  It was my Adblock Plus!!  Fine now, thanks again!