It has been over a year since I opened my account at Lending Club. I’ve still only got the one charge off. A few months back we added another $1000 or so dollars to meet the PRIME lending criteria. PRIME has been working well for us. Just set the filter and desired allocation then it takes care of the rest; I get almost daily emails about new investment orders that were made automatically. With $413 in interest, less the $24 charged off, $16 in fees, and a $27 adjustment for loans which are currently past due I’m up $346 on my deposits of $4950. Lending Club tells me that is an Adjusted Net Annualized Return of about 14.2%.
Since I last wrote about my Lending Club progress they have made several changes to the site, including adjusting for past due notes and allowing automated PRIME investing. The fact that P2P lending is so new gives me some minor concerns as I continue to loan out my money in 3-5 year increments to complete strangers. Maybe my main concern is in the illiquid nature of the notes which I’d have to sell on the secondary market. I haven’t tried that yet. Anyhow, I’m happy with a return that’s something like 30x greater than what I’d get in a bank. Even as my return does taper down towards the 6-9% average that is still a lot better than most investment options. I plan to continue to automatically deposit a small amount each month and leave Lending Club as a small and exciting slice of our portfolio.