Comments on: Lending Club – September 2009 Performance

By: Heather Idoni

Heather Idoni — Thu, 29 Oct 2009 13:58:08 +0000

I was thinking about using our IRA to fund a LC account, but it will cost $250 a year to do it, as they use a 3rd party for IRAs. Do you have any ideas to somehow avoid this cost?

By: Nickel

Nickel — Thu, 08 Oct 2009 18:19:45 +0000

Brian: J. Money is correct. Most loans are on the order of thousands of dollars (up to $25k), but they are split up into notes of as little as $25 for investors to buy. This allows investors to spread their risk around, and also allows borrowers to get their money without LC having to find someone willing to lend out a few grand all in one shot.

By: J. Money

J. Money — Thu, 08 Oct 2009 18:12:12 +0000

I think it’s the minimum amount because the actual loan is “chunked” out. So if someone wanted to borrow $500, let’s say, it would mean 20 mini-loans of $25 scattered all over for investors to join in (like Nickel).

At least that’s what I gather when I initially tried signing up. One of my friends has like 100 loans of $25 in his account, so I guess it’s a pretty popular #.

By: Brian

Brian — Thu, 08 Oct 2009 17:44:14 +0000

I find it surprising that the minimum amount that can be borrowed is $25. Who would go through all this trouble with making payments etc. on a principal of $25? Did the guy need the money to buy lunch or something?

I don’t want to sound rich or anything, because I’m definitely not. But if I needed 25 bucks that badly, I could think of some easier ways to get it than to take out a loan.

By: Nickel

Nickel — Thu, 08 Oct 2009 15:10:59 +0000

Eric: I think it’s too late to sell it. When it first showed up as late, I probably could’ve sold it at a discount, but at this point I think it’s pretty much a lost cause. It’s been sent to collections, so I can’t imagine anyone wanting to buy it.

CCC: That’s actually a good idea for a dedicated post — how I choose loans, and how long it takes me. Keep an eye out…

curious: They make their money by charging a fee to borrowers, and also taking a small slice (1%) of all amounts paid to lenders. There are no brokerage fees per se.

By: curious

curious — Thu, 08 Oct 2009 13:02:37 +0000

Hello Nickle,

Can you advise on the best way to minimize brokerage fees? I.e., do they chart per note, based on your balance, based on the profit, etc …?

Thank you

By: Credit Card Chaser

Credit Card Chaser — Thu, 08 Oct 2009 01:32:37 +0000

I have played around with the idea of putting some money into Lending Club. What is the time investment on your end so far? (i.e. is it necessary for you to spend a lot of time researching/analyzing things on the site or can you pretty much still get a good return by just doing some initial research and then leaving it be?)

By: Eric

Eric — Wed, 07 Oct 2009 23:13:08 +0000

Awesome my rate is around the same. Have you thought about selling the bad note?

By: Patty

Patty — Wed, 07 Oct 2009 22:37:10 +0000

Great Rate so far Nickle. I became an investor there last month. It is really quite interesting and I’m enjoying the learning process. So Far – so good. Next month, I’ll add an additional amount for investing. Slow and steady.

By: J Money

J Money — Wed, 07 Oct 2009 22:34:50 +0000

I got all excited to sign up and start investing last month when I realized the state of Maryland forbids it!! What a dissapointment…I had some free cash I wanted to play around with if you ever create your own lending club, you better let me know.

By: Nickel

Nickel — Wed, 07 Oct 2009 21:36:44 +0000

Gerry: The minimum investment is $25 per note, so you can work up from there. Obviously, the more notes that you have, the less that a bad note will hurt you.

By: John DeFlumeri Jr

John DeFlumeri Jr — Wed, 07 Oct 2009 20:17:52 +0000

That’s a hell of a good report, my congrats to you!

By: Gerry S

Gerry S — Wed, 07 Oct 2009 19:13:47 +0000

Just curious, what do you think is a good minimal investment to get started in Lending Club? (In other words, I dont have a lot of money – LOL)