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Worst Month Yet

Started by Peter, June 03, 2017, 11:00:00 PM

Previous topic - Next topic

Rob L

Posting this to take the opportunity to whine and also see if others have seen anything similar.
Background; my portfolio's weighted average age was maybe 15 months this past January and is approaching 18 months now.
Perhaps 90%+ of the loans are D's and E's, and all are 36 month. I have 4000 - 5000 active notes (not fully paid or charged off).
Got my Nov statement today and the past two are my worst by far.
Simply taking the numbers from the 2015 monthly statements and computing charge offs as a percent of principal invested and as a percent of interest received I came up with the following (easy stuff; no NAR, IRR, XIRR, etc.):

Stmt Start           Charged Off            Charged Off             
    Date                   as a %                   as a %
                           of Interest               of Principal
-------------          -------------             -------------
01/01/2015              50.24%                   0.66%
02/01/2015              31.27%                   0.38%
03/01/2015              48.74%                   0.69%
04/01/2015              40.07%                   0.56%
05/01/2015              31.68%                   0.41%
06/01/2015              46.76%                   0.61%
07/01/2015              27.51%                   0.39%
08/01/2015              48.92%                   0.59%
09/01/2015              41.55%                   0.52%
10/01/2015              61.86%                   0.84%        ****
11/01/2015              75.24%                   0.92%        ********

Simple Average         45.80%                   0.60%

Yep that's right fans. This months score was 75% of my interest covered charge offs and I got to keep 25% for myself.
My average weighted portfolio age is way past the peak of the charge offs curve, so I don't understand what's going on.
Maybe I should just consider myself lucky that I at least made a profit.
There's been a lot of dissing of LC's ANAR, but it did warn me things were going south fast. It dropped almost a full % the past 2 months.
Now I'm going to have a beer (and cry in it).


Ouch.  That is a pretty large jump.  I'd be curious if you notice anything similar about them.  All from a similar month, etc.  The holidays has had me wondering what effect it has on both existing loans and loans issued this month in the future.  I just haven't had time to attempt to research it.  At 4.9 month average duration I'm still too new to cry over too many charge offs yet.  My only advice is have 5 beers.


Yep, you are near the tipping point.

It will be rare for you to have negative monthly portfolio return with these loans unless you stopped lending cash in the account."> from: Rob L on December 03, 2015, 05:40:26 PM


Hi Rob,

I have over 5000 notes invested and my Lending Club results have recently been poor.  Mostly C,D and E notes.    Can I ask you what is your current adjusted net annualized return?  You may be about 8-10% now, but the only way to keep your return high is to keep plunging more cash in.  If you stopped investing for a while, the losses would start to snowball.
If you look at the 'Understanding Your Returns' chart, the interest rate falls very far over time.  Once your portfolio is over 18-24 months, the returns really start slipping to between 6-8% and with the tax consequences of so many write-offs you may even have a negative return.





My account and that of my family has shown increased distress in the last quarter.


Publisher of the Lend Academy blog

See my returns here:




Ah... professional victimhood.  Ok, you don't want to learn - you want someone to blame, besides yourself.

Moving on...

Yes, please move on.  I am trying to honestly help the OP and give information about my experience with LC.  I'm really confused by what the motivation is to insult me, but please stay out of this discussion.  You haven't added anything to the topic except for trying to silence me.  I am just offering Rob my honest experience and warning him about what is in store. 

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