Thursday, April 15, 2010

All but a few of my latest Lending Club investment loans have been issued

Just a week ago I placed orders to invest in a new batch of Lending Club investment loans and already 75% of them have been fully funded and issued. And of the remaining five, two have reached full funding and are awaiting final review. The remaining three are about 75% to 80% funded and likely to be funded and issued by Monday.

Somehow I made a mistake and inadvertently selected a loan that was not already "Approved", which means that although it has reached full funding, it could still be declined if the borrower does not finalize proof of income. I should be okay on this one (as I have been for most such loans in the past), but it does add some uncertainty.

It has been ten days since I started this investment batch by initiated a transfer of funds to my Lending Club account from within the Lending Club web site. Assuming the remaining loans are issued on Monday, that will have been a two-week investment cycle, which is about what I would expect with a moderate size batch of loans, a bunch of which were less than 50% funded when I selected them, and includes the time for the transfer of funds from my bank account to settle in my Lending Club account.

Meanwhile, my Net Annualized Return has inched back up to 15.08%. I have a total of 52 notes (assuming the latest batch all get funded.)

Even with this doubling of my total porfolio size, my Lending Club investment is still a modest size experiment. Even doubled again it would still be modest size. If all goes according to plan (not that I actually have a plan), by the end of the year I should finally have a real investment in Lending Club loans.

My goal continues to be a 15% return, but I figure I need a little buffer so that repayments (and maybe even defaults) don't push me below my goal too frequently. I may in fact keep pushing upwards with loans in the 16% to 18% range until I get my return up to 16% and then gradually work the average back to 15.5%.

So far, my Lending Club portfolio has been perfect, with no delinquencies or even late payments. I started investing with Lending Club back in June 2009.

This is still just an experiment for me since I have no prior experience with this type of investment, but so far in has been very encouraging. I intend to double the size of the experiment in June or July (assuming my work income continues.)

-- Jack Krupansky

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