My Experience at LendIt 2014

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#LendIt2014 swag

#LendIt2014 swag

I recently got back from my trip to San Francisco for LendIt 2014.  It was my first trip to California and I enjoyed everything about my visit. I first have to thank Peter and his team at Lend Academy and LendIt for the opportunity.  Without their generosity to allow me to volunteer, it wouldn’t have been feasible for me to attend.  Enthusiasm filled both rooms at the Hilton over the course of the two days. It is incredible to think how far the industry has come since I started following it last year.   [Read more...]

Peer to Peer Lending Automation - The Key to Investing in Lending Club

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lendingclubautomation

If only it were this easy…

Over the last couple of months, we have featured 3 tools for automating your investments in Lending Club.  Before the question and answer sessions we posted, my process for my investing was completely manual. Brian was investing manually as well and he actually setup a third party mobile app to send him notifications just before Lending Club releases notes.  Even with my relatively small account, I was missing feeding times and had available cash just sitting in my account pretty often.  Automation tools are starting to mature and I decided that it was finally time for me to try them out and hopefully help others who were considering automation.  [Read more...]

LendingRobot Exits Beta - Officially Launches and Open to the Public!

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Just last week we featured a Q & A with LendingRobot.  At the time, they were still in beta, but that all changed as of this morning.   They have officially launched and are open to the public.  You can read more about it in their press release here.  If anyone has experience in the beta or has signed up now, we would definitely be interested to hear your thoughts in the comments.  Our goal is to provide a review in the future.

Understanding Lending Club Returns

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There are many third party tools out there that many seasoned investors already know about.  However, Lending Club continues to add functionality to their own site like net annualized return.  Today I noticed something that I had not seen before which was a link to ‘Understanding Your Returns’. [Read more...]

Lending Club adds Adjusted Net Annualized Return

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Some of you may have already heard about or seen a change to your Lending Club account. Last week they added an on/off switch for adjusted net annualized return.  Often times, I am met with skepticism when I tell people about my investment in Lending Club and it is soon followed by a question of my return on investment.  I feel that I can now give them a fairly accurate number without having to do any math. [Read more...]

Changes coming to LendingClub?

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A short update with what has been going on with LC retail investors.  There has been an awful lot of complaining going on over at the www.lendacademy.com/forum about people not being able to get fully invested in the top notes. While this may be true for people who have large accounts - I can’t imagine people who have <$5k invested (like Brian and I) are having issues.  Peter over at LendAcademy had the opportunity to meet with the CEO and it sounds like changes are coming. Surprisingly - borrower demand does not seem to be an issue.  It seems more like a resource (people/technology) issue.  Keep in mind that they currently only have 275 employees.  Personally, I’d rather see them continue stable growth instead of trying to expand as fast as they can.  We will be sure to post any new features here.  It seems like auto-invest for the masses will be likely.

I’m still very happy with my LendingClub investments and have been watching my NAR creep up with the purchase of more C-F notes.  Currently I haven’t had any notes go late. Now if only my 30 pending review notes would be approved :)

New P2P Lending Company - GROUNDFLOOR

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The P2P lending industry is certainly starting to heat up.  I’ve discovered a lot of companies in the P2P lending industry and gained some insight into these companies by watching some of LendIt 2013 .

Recently, I found out about a new company called GROUNDFLOOR .  The idea intrigued me, so I decided to reach out to the founders: Brian Dally & Nick Bhargava.  In short, it is a P2P lending company tailored to real estate development projects.  After you’ve checked out their website, read the Q&A session below for some of the details we were able to gather from them.  Brian and I have both signed up for the private beta and are excited to put our benjamins to work!

Q: We would first like to know how and why you got interested in the p2p
lending industry. Was it an extension of seeing companies like
Prosper/LendingClub remove the banks from the equation in lending?

A: Actually, we were not aware of LendingClub or Prosper when the concept for Groundfloor first took shape. It was really the financial crisis of 2008-09 that motivated us to build a new kind of finance. We are interested in returning to the roots of what finance was before there were 800-pound gorillas who are “too big to fail” yet fail the rest of us regularly. 

Q: What is the biggest obstacle that GROUNDFLOOR faces or has faced?

A: The banks have a sophisticated, heavily engineered process for originating, underwriting and managing loans for real estate. Replacing that with a peer-to-peer model is hard. We think we understand the obstacles well enough and have designed ways to handle them. The toughest thing in making any market is to make sure that the deals we put forward have the maximum appeal to investors. That’s why we’re starting off with a beta, to test and make sure we’re dialing that in correctly. 

Q: Any information on what rates lenders/borrowers can expect to
earn/pay? Will it be similar to LendingClub in note grades etc?

A: The rates vary based on the project and deal structure, but lenders can expect to earn interest from 5% and up, perhaps as high as 10%. Loans are secured by the property and we have some innovative twists to share that lenders are really going to like.

Q: How will projects be selected and what types of projects do you anticipate financing?  Are there any in the pipeline you can share details on?

A: Developers and lenders who are interested in what we’re doing should visit GROUNDFLOOR.us and sign up to get involved now. We’re putting together a range of projects for feedback from potential lenders. We’ve identified a handful of initial prospects, and are continuing to add more. Lender feedback will ultimately shape which projects are part of our beta and which ones will need to wait until our commercial launch. 

Q: How big of loans do you anticipate to be servicing?

A: We’d rather not speculate about that right now.

Q: Finally, do you have an anticipated launch date of the first project and when the beta will begin?

A: Not that we can announce yet, no.