Gaining interest in Prosper or Lending Club

[disneysteve]

As savings rates drop, I've been thinking more about giving the P2P lending sites a whirl, at least with a small amount to get started. Let's hear about any experiences you've had, good or bad, particularly more recent experiences. As qualifying for credit has gotten more difficult, I suspect more people will be turning to these sites for loans.

[Caoineag]

I have experimented with Prosper only. Both the loans I have made are current though one is very recent and the other is about 5 months old. I have invested only $100 so far and I am reinvesting the interest and principal as it is paid. My official earnings for my first loan of $50 is $2.39 after fees so far (would be a net ~11.24%, actual rate on my loan is 13%). But this is one where you get to determine how much risk you want to take.

Personally, this is my version of gambling. I use my allowance occasionally to play and when my debts are fully paid off, I will probably play with it more. I do recommend only investing in $50 chunks to spread out your risk. I have heard of people getting burned.

[Slug]

You might want to revisit the thread on this....

It's still quite possible to get rates around 10% on loans with very high credit scores and clear financial/business acumen. I fund about 1 loan/mth through reinvestment only.

[disneysteve]

Does Prosper have a minimum credit score for borrowers like Lending Club does?

[humandraydel]

My words of advice: Be very careful. Only loan to the highest credit ratings. I have heard many stories of people being burned on Prosper - and it could get worse as housing continues to slide and recession becomes real.

[jc3900]

Seriously, I don't even know why you would bother on this website. After talking to my dad about this, I am convinced that this is a very bad bet and a waste of time. Think about it, if you can only find "quallified loans" every month and only in small amounts of 50 dollars or so your ability to grow flattens out very fast over time. If you guys want something that is fun and cerifiably risky, go to intrade.com and bet on obama or hilary futures.

[Broken Arrow]

Seriously, I don't even know why you would bother on this website. After talking to my dad about this, I am convinced that this is a very bad bet and a waste of time. Think about it, if you can only find "quallified loans" every month and only in small amounts of 50 dollars or so your ability to grow flattens out very fast over time. If you guys want something that is fun and cerifiably risky, go to intrade.com and bet on obama or hilary futures.

OMG, there are futures to be had on political candidates?! I mean, yeah, I guess anything can be turned into an "investment" of some kind... even if it is certifiably insane.

I don't personally believe in Prosper either, but the beauty of free internet forums such as this one is that we can bring up all the questions we want for further thoughts and discussions... without really losing anything. Think of it as another resource to tap, or a tool to leverage, to further fine-tune our minds.... It's only a waste if you see it and use it that way....

[tedbundy]

OMG, there are futures to be had on political candidates?! I mean, yeah, I guess anything can be turned into an "investment" of some kind... even if it is certifiably insane.

I made quite a lot of money in political futures this year. Intrade =

[gekkoplus]

I am a lender in Prosper since March and invested $200 initially (4 borrowers, 50 each, aggressive portfolio). After watching performance of my portfolio over 3 months (all loans are current), I am taking a step further. I am reinvesting my interest as well as contributing $100 ($50 per borrower) each month starting this month.

So far I have $300 invested (plus $20 something received back) in an aggressive portfolio (20% interest on average) with all loans current. Of course I am prepared to see a few of my loans to go default, but I am hoping that enough diversification will keep my ROI to at least 15% in the future.

[Langlo Family]

I am a lender on Prosper. I initially invested $500. ($50 for 10 loans) I haven't put in any more than the $500 but I am up to 16 loans now through reinvestments with one already paid off. I earn a return of 17.67%. Some people say only take the loans with high credit ratings. Well, I had a buddy that put $1,000 into loans that were A or AA credit levels and 4 of them defaulted. I have loans from HR to AA. I think if you are smart about who you lend to, it doesn't matter what their credit grade is.

I will never give money to anyone who is asking for a loan of more than $10,000. I don't care if it's the best credit score ever, I'm not going to do it. It's too easy for something to happen and if you have to decide to pay your mortgage or prosper, you're going to pay your mortgage. (Replace mortgage with any other important payment). With a small amount, it's easier to make that payment.

I won't loan to any start ups. Again, pretty risky. I prefer people that are looking to consolidate loans or bring down their interest rates. These are people that are used to making payments and if the loan can help them make a payment a little bit lower, the easier it should be for them to loan out.

I look for people that are Homeowners. They know the importance of making payments and usually are responsible.

There are a lot of tips out there. I spent a lot of time reading in the Prosper forums to get some tips. If you're thinking about lending, I'd take a look in there first.

[Slug]

If you're serious about lending on Prosper, please all read the non-sanctioned boards. I especially recommend Prospers.ORG - Prospers Wiki

They give frank advice regarding lending or borrowing on the site without the great Prosper overseers moderating the messages.

This month I doubled my investment in Prosper from $1k (that I put in 2 years ago) to $2k. But, I put it all in 1 loan b/c I've known the guy for 10 years. We'll see how it goes.