One of my 2017 goals is to diversify my investments to include more areas than just the stock market. I invested $2,500 into Lending Club, which is a Peer-to-Peer lending network. Click on this link to learn more about my Lending Club strategy. My initial goal was to invest $2,500 per quarter this year, $10k total. I’ve decided to limit my investment this year to $5,000. I’d like to see how my account performs over the year, then decide if I want to invest more money or just reinvest returned principal and interest into new loans.
I added another $2,500 last week. This money funded 100 loans. I felt that 100 loans was not enough to base my future Lending Club investing decisions on. With $5,000 invested I’ll always have at least 200 loans funded. I’ll also receive enough monthly principal and interest to fund a fair amount of loans each month.
This post documents month three of my Lending Club journey. In this month I’ve seen my Adjusted Net Annualized Return go from 6.72% in month 1, up to 7.39% in month 2 to 11.02% this month. I’ve also gone from 100 initial funded loans to 215 today. I’m using Lending Club’s automated investing tool. This tool funds new loans when my account reaches $25 in value. This value comes by way of returned capital and interest payments.
Lending Club Month Three Results
To date, I’ve received payments totaling 378.96. This month I received $190.13. The breakdown of payments are: $31.36 in interest and $159.27 in returned principal. My adjusted net annualized return is now 11.02%. The image below shows the details of my investment and performance.
Last month I had one loan that is 31 – 120 days late. This loan appears to be a total loss. I haven’t been with LC long enough to know if I can expect some recovery at a later date through collection. For now, I’m considering it a total loss. I also have a new loan that just went 10-days late. This is not a concern yet. We’ll see if it is still in default next month.
Here’s another view of my portfolio. This image shows some of the same information as above, but it also shows loan breakout by borrower grade.
I expect to fund 5 new loans over the next 30 days, which will take total loans funded to 220.
I’ll be posting monthly updates, so you all can follow along and see how Lending Club performs. I’ll also be adding my Lending Club monthly income to my monthly total income posts.
Do you have money invested with Lending Club, Prosper, or another P2P service? If yes, how are your loans performing?