SIGN UP TO RECEIVE THE LATEST POSTS VIA EMAIL!P2P Lending – Switching from Prosper to Lending Club
March 11, 2009
After logging into my Prosper.com account for the first time in a while, I was shocked to see how bad all my loans are performing. I went from 1 charge off to 9 in about 4 months along with 6 late loans.
I am now in the red and most likely will lose even more then the $62.74 I have lost thus far. I was an early investor in Prosper when they opened in 2006, so you can see that I would have been better putting my money in a savings account.
A few months ago, after reading some comments from my previous prosper posts, I decided to give LendingClub a try. LendingClub works the same as prosper but touts stricter underwriting guidelines to help weed out those unsavory borrowers.
I set up an account and funded 8 loans. I did 2 loans with an A credit rating, 4 with a B credit rating and 2 with a C credit rating. After watching these loans over the past few months, I have been surprised that they are all current, even through this current recession. Two of those loans have been paid off completely. My average rate of return is 9.75%. This is pretty good considering the current savings rates out there.
Since this has been a successful test I have decided as I receive payments from my Prosper loans that money is going directly into a new LendingClub loan. I have not funded a new Prosper loan since May last year, so I am hoping LendingClub can help make up for my losses at Prosper. I still feel that person to person lending is a great way to invest and that the company that can get a handle on bad borrowers will ultimately win the prize. Right now, I am pretty sure that Prosper isn’t the one!
NOTE: For posts that contain bonuses, be sure to read the post for bonus expiration dates. Links may work but the bonus may have expired.
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I’m with you on leaving Prosper – it has been nothing but losses for me.
[...] have had a good experience with LendingClub. I wish I could say the same thing for Prosper.com since I am now moving everything from Prosper to LendingClub. P2P lending is a unique way to spread [...]