Wednesday, February 17, 2010

Latest Lending Club loan payments completed in four business days

Just to confirm  something I said in my previous blog post on how long it takes for borrower payments on Lending Club loans to be credited to the investor's Lending Club account, I just checked again and my most recent two payments have completely posted as "Completed" sometime this afternoon or earlier this evening, exactly four business days after the payments were due from the borrowers -- due on the 10th, completed on the 17th, with an intervening weekend and a holiday.

My Net Annualized Return inched up to 14.49%.

-- Jack Krupansky


At 9:17 AM EST , Anonymous Roy said...

Thanks for answering my questions.

I've got another one for ya, if you don't mind me asking.

So, let's just say I buy one $25 loan at some percentage. It works out that they are paying me $0.87 / month for 36 months. That works out to be just over $31 in total payments.

So, in three years, I've made $6 off of an investment of $25. Or, $2 a year. Or, 25 / 2 = 12.5%.

That's a yearly gain of 12.5%. And guess what, Lending Club shows my Net Annualized Return of being 12.6%, so, yeah, it's right around there.

The question is... every month I plan on taking the money and reinvesting, buying another loan.

If I continue to do this for years and years, and assuming I get all the payments, will they treat these "reinvestments" as NEW investments each time?

I guess the best way to phrase the question would be... will they base this calculation off my initial investment amount, or off of what I purchase in loans?

Because if it's the former, and I keep reinvesting, it's just going to drive this number up and up, right? And I guess that wouldn't truly be a percentage of what I'm gaining.. so it's probably the latter in that the calculation is based off of what I pay for loans vs my return, not what I initially invested in the account.

Thanks again!! =)


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