Comments on: Should You Invest With Lending Club or Is It Too Risky?

By: Coozbee

Coozbee — Sun, 12 Jun 2011 18:20:16 +0000

This company has more exit holes than a RAT in a dump. There is NO guarantee on return of investment. The RISK is all on the member and
there is no real enforcement of getting swindled by a company who has
their information and operation practice in writing, upfront in the prospectus
as the other members can verify in the comments. I did pursue this
and the state of California enforceses the law. So anyone outside of
California is at the mercy of the state agency investigating the company.
If there is a small amount of complaints, the agency puts it on the back burner. Believe me, I went thru the whole ordeal. Take my word for it,
your better off buying stock on the NYSE that pays a dividend, than this con
job business, that is very shrewd in its operation and evasive tactics by
the company’s attorney. That’s why there ARE laws established to protect
the consumer. This company goes around the established laws. Remember
the saying by P.T. Barnum “there’s a sucker born every minute”- “Don’t be a sucker!!!! Avoid this CON game!!!

By: Perry

Perry — Thu, 28 Apr 2011 12:19:43 +0000

I am currently reading the prospectus and studying Lending Club.

The risks to an investor are well explained (and the fact that Lending Club as a company was a money loosing operation – which is separate from the performance of the Notes).

But it also states that in if you don’t live in California where everyone can invest up to $2500; that all other investors (or investors in California who wish to invest more than $2500) must have a annual adjusted gross income of at least $70,000 ($85,000 for California) and net worth of $70,000 ($85,000 for California); with the net worth not including the value of your home, home furnishings, and automobile). There is an alternate qualification of $250,000 net worth which does not include your home, furnishings, and automobile).

As I read the above posts – I wonder how many people investing several hundred to a couple thousand of dollars actually have met those criteria. Might I suggest that if Lending Club were to have a financial problem – that the first set of Note holders that could be affected would be those that lied on their application as being qualified as an investor.

In my case – if I chose to invest; it will probably be with an initial investment of $30,000 in Notes (not stock).

Have a great day,

By: Maybe I missed it - but I haven't been able to find the answer to a basic question that Every potential investor should be asking; "what is REQUIRED for Proof of Income and Assets, ETC from the loan application? Obviously these P2P Clubs are pulling a "Si

Fri, 25 Mar 2011 13:26:31 +0000

Hey, did I miss where these P2P websites Explain Supporting Doc’s Collected to VERIFY the Written Word on an App.?? No mention (that I saw) of needing 2 recent Paystubs and hopefully a W2 or two……

Also, it would appear from their websites, that one uses Equifax and the Other Experian. So, what I’m Hearing is; they Only pull a “Single Bureau” Credit Report? Thus Only getting a1/3rd view of the Overall Credit Health of a Borrower………..

Lastly, does anyone know if this same concept and business model is being used For; “”Car Paper”" (SECURED Collateralized Debt that also Pays High Yields for Notes used to purchase late model pre-owned cars).

Unsecured vs. Secured in this P2P Arena is what I’m looking hard at before Jumping IN………….. I like Sleeping Well – a Pink Slip as Security for a Note is Almost as good as an Ambien in my book

By: Shane

Shane — Sat, 12 Mar 2011 22:18:45 +0000

I’m with you on that suspicion Ken, the whole business is shady, they can take ownership of your loan if they declare bankruptcy and stop paying you back.

By: Ken

Ken — Sat, 12 Mar 2011 20:26:48 +0000

I haven’t seen any comments lately on lending club. They have never responded to my complaint on their verification process, and I still believe they had someone within the company create this fictious character, borrowed 20k, and put it in his pocket. Then turned around and told everyone who funded this loan, that the guy
skipped out, and they couldn’t find him. Come on lending club, prove me wrong with what happened here. If I’m wrong, I’ll admit it. If not, send me my money that I put up for this guy, YOU verified and rated this loan as a B loan (Low Risk). LC’s attorney, danced around all the questions asked, and would not provide me, a member of LC with any information. So tell me, WHY would anyone WANT to invest with this company?

By: Lee

Lee — Tue, 01 Feb 2011 18:24:43 +0000

I signed up with Lending Club about two weeks ago. Seemed like a good way to go. It was highly recommended by a friend of mine. I have been chomping at the bit wondering if I made the right move. Glad I found this blog, now maybe I can sleep! Heh

By: GIC

GIC — Fri, 14 Jan 2011 05:37:05 +0000

Partner and me ( accountant and engineer ) are raising capital for a small RE investment fund ( up to $400K ). about 30% of the fund will be own by us and rest will be funded from outside. We both have excellent credit scores, experience with investing, both owning a rental properties.
So if there are people interesting in investing let us know. Our estimate is about 10% return on investment. ( are plans are conservative with this invest. fund )… it is more long term investment . Minimum 3K

By: Miriam

Miriam — Sat, 16 Oct 2010 06:06:54 +0000

Techentre, how did you find out that they have lost money since they started? I have looked everywhere, could you tell me where to find that info? Thanks : ) Weighing my options before signing up….. or not

By: Techentre

Techentre — Thu, 14 Oct 2010 18:32:15 +0000

Charly, dude, get out while you can! Have you read the prospectus? It is insane, if they went under they can stop facilitating the loans! It says so right in the prospectus! And they have LOST money since they started, so they very well could go under.

Ultimately you aren’t lending to the borrower. Lendingclub is lending to them and you are BUYING a NOTE representing the loan.

Get on the Folio site and start selling, you should be able to get the current value on 95% of your loans, the under performing ones you will likely have to take a discount on.

If lending club turns their company around and starts doing well, I would consider lending again, until then the risk IS NOT worth the reward.

By: Charly

Charly — Mon, 04 Oct 2010 03:09:11 +0000

I am an investor with LC and have around 15,000 $ invested. So far, the loans which defaulted or are late are not the ones from lower credit score borrowers but from the ones with 600+ and 650+. The lower credit score people sometimes are late on their payments, sometimes for a month but then pay but these better loans that I even get lower interest rate from gives me worries especially when they can’t find the guys, leave countless messages and/or default them stating that recovery of any assets are unlikely. I tried to diversity, investing just 25 $ per loan and once a week only, but you still end up investing more than 25 $ per loan unless you sit down and analyze hundreds of loans and make sure you do not invest two weeks in a row in the same loan. This results in defaulted loans that I bought multiple shares of. I do my own math that’s the only math I trust. I am getting after defaults, defaults in process, service charges, roughly 7 % even though they quote me for getting about 11 %. I think it’s still decent return.