My goal is to achieve a greater than 13% return using Lending Club, and right now, I’m kicking that goal’s butt.
I aim to reduce defaults by using smart criteria for picking loans, and while I’ve been doing pretty well overall, I have had a few setbacks this month. Still, even with 6 loans not paying at all, I’ve been able to increase my rate of return slightly.
15.87% Interest Rate
Since I sold a few loans last month and reinvested the cash in higher interest rate loans, I thought my interest rate would rise a little more than it did. However, I had several setbacks which pushed the rate down. It’s hard to complain about a nearly 16% rate of return, so I won’t. Take a look at my account snapshot:
I had a few setbacks this month, including 2 loans that have been sent to collections. I assume I won’t get another penny from them. It sucks, but it will happen to a certain percentage of loans. The fact that I was able to keep up my high interest rate even without getting paid by 6 loans this month is really encouraging. If even one or two of the six loans get back into good standing, I could see my interest rate increase.
Two more borrowers fully paid off their loans, which I’m not too ecstatic about, but what can you do. Having loans paid off early hurts my performance, but better early than late, I guess
Future Lending Club Plans
I’ve got enough to make another $25 loan, so I’ll be doing that in the next few days. I also now have expected monthly payments of $152, so that means 6 new loans a month. That’s pretty cool, I sit back for a month and I get $150 I didn’t have before. No wonder this lending business is so popular.
Not too much to complain about here, let’s hope for some good luck in the next month!