No 1099 from Lending Club

In the past 3 years, I've never gotten a 1099 from Lending Club.  In planning for tax season 2011, I gave them a quick call to confirm the reason.

An 1099-OID will only be sent if interest (late fees - servicing fees) is greater than $10 for any ONE note in a year.  In other words, if you, like me, have a bunch of small notes, you will never get a 1099-OID.

You could get a 1099-MISC if you receive incentive payments of greater than $600.

Good to know.  (Whew)

Lending Club Statistics

On the "Highlights" Lending Club Statistics webpage, the statistics have not updated since 9/13/2011.  An email with support early November said the would be updated shortly.  As of 11/17/2011 still not updated.

Update:  As of November 29, 2011 the stats had been updated.

Going in deep...

Up until this point, I have only had a small portion of my investments in Lending Club.   Last month, I rolled over a Roth - IRA into Lending Club.  I'm up to about 15% of my total investments in Lending Club.

The rollover process was pretty painless.  A form is filled out on-line, information is sent to the previous custodian to send the information and monies to Lending Club.  The whole process took a couple of weeks.

Investing the money into loans can take some time, I wanted small amounts in many loans.  My guess is that will take 2 months to have all the money in loans.

So far, so good,  over 19% return!

Ten Percent!

My rate of return is now ten percent! It hovered around 9% for the past year or so, but has gradually gone up since I revised my investment strategy.   Investing in the grade "D", "E", & "F" is working.

Ten Percent

Playing with the numbers...

I've been experimenting with downloading the data from Lending Club.  (Warning - the data has to be scrubbed a bit before you can use the XML or CSV file) I've been interested in breaking down the numbers available on the website.

In particular the statistics on this page:

https://www.lendingclub.com/info/demand-and-credit-profile.action

So far, I have been unable to come up with numbers on this page using the downloaded data.  One item that has me a bit confused is the outstanding loans numbers.  It seems to include the "paid" loans.

It's weird, if you total up the paid, current, late, and default numbers it equals the outstanding loans number.  For example, on 4/28/2011, 5907 (Outstanding) = 852 (Paid) + 4938 (Current) + 50 (Late) + 67 (Default).  I would think the Outstanding loans would not include the Paid ones.

Also note, the number of grade F and G loans - barely a thousand between the two of them, with default rates over a 10% of outstanding.

Your thoughts?
 

First Post

My investing methods on Lending Club:

I joined Lending Club in November of 2009.  At first I started slowly, adding a $100 dollars at a time. As a former member of Prosper, I believe in peer-to-peer lending.  Ordinary folks have a lot of cash lying idle, and why shouldn't they be able to lend it.  I believe it is a great model.

In the beginning, I stuck with the higher quality grades.  However, the more I looked the statistics page on Lending Club, the more I realized, that may not be the best approach.  See the page here:

https://www.lendingclub.com/public/statistics.action

The returns on the lower grade loans are actually higher.  The "A" grade is actually the lowest.  "E" and "F" are the highest.

What are your thoughts?

Welcome to the Lending Club Water Cooler

As a lender, borrower,  and general fan-boy of Lending Club I wanted to create an place for further discussions about Lending Club.   The topics to be included are:

• My experience as a loaner
• My experience as a borrower
• My returns
• My suggestions for improvement
• Analysis
• General comments

Feel free to leave a comment!