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Lending groups as an investment?
07-03-2014, 05:29 AM
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#1
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Confused about dryer sheets
Join Date: Jun 2014
Posts: 6
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Lending groups as an investment?
Hey folks,
I'm new to the early retirement community and this is my first post so I apologize if this has been covered in the past.
Does anyone have experience using the online lending groups such as "Lending Club" or "Prosper" as a portion of your investment portfolio? If so, what percentage do you dedicate to this?
At the end of last year I wanted to find out how this worked so I put $250 into an account to kind of take it for a test drive. It seems pretty straight forward. Sigficant risk, due diligence, etc....but I want to bump up the ante.
Any thoughts on what is too much?
Thanks
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07-03-2014, 05:32 AM
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#2
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2002
Location: Texas: No Country for Old Men
Posts: 50,003
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__________________
Numbers is hard
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07-03-2014, 08:52 AM
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#3
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jul 2006
Location: Pacific latitude 20/49
Posts: 7,677
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I would let the $250 ride for a couple of years and then try to cash out.
__________________
For the fun of it...Keith
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07-03-2014, 12:48 PM
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#4
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Recycles dryer sheets
Join Date: Feb 2011
Location: On a dirt road
Posts: 332
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I was intrigued by the concept a few years ago and looked at some of the offerings and the limited data provided and decided it was way too much risk based on limited and possibly inaccurate data. I am a money lender by day and a landlord by night so assessing risk and credit is in my DNA. Neat concept and may be fun to dabble with 250 bucks but certainly not any significant portion of my $ would ever go into this bucket!
__________________
"Up sluggard and waste not the day, in the grave will be sleeping enough." Benjamin Franklin
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10-15-2014, 07:37 PM
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#5
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Confused about dryer sheets
Join Date: Jun 2014
Posts: 6
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After doing it for almost a year I'm inclined to believe everyone is right. I think I will consider this to be a gambling loss (or maybe a win) but I won't add to it. Thanks.
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10-15-2014, 09:01 PM
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#6
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Dryer sheet aficionado
Join Date: Jul 2013
Location: Castle Rock
Posts: 31
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Try Kiva. I find it more as an investment in the small business person applying for the loan. I have invested around $400 (actually more like donated) and have now helped over 25 individuals grow their businesses.
You can pick the country or region you want your help to go to as well as the industry, I usually choose the agriculture industry, then pick the individual you want to help. I will probably never withdraw my original investment and as I get paid back I am able to offer help to others. It's a nice feeling when your original loan is paid back you get to re-loan it to someone else. After 6 years I haven't been stiffed on a loan yet.
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10-16-2014, 07:03 AM
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#7
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Thinks s/he gets paid by the post
Join Date: Feb 2014
Location: Williston, FL
Posts: 3,925
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I thought about it, but decided against it. I am well familiar with credit score, because of tenant screening, and if I was going to do it, I would make sure everyone has at least a 650 credit score.
But you are better off just investing in preferred dividend stocks if you want to go that route.
__________________
FIRE no later than 7/5/2016 at 56 (done), securing '16 401K match (done), getting '15 401K match (done), LTI Bonus (done), Perf bonus (done), maxing out 401K (done), picking up 1,000 hours to get another year of pension (done), July 1st benefits (vacation day, healthcare) (done), July 4th holiday. 0 days left. (done) OFFICIALLY RETIRED 7/5/2016!!
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10-16-2014, 08:46 AM
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#8
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jul 2006
Location: Pacific latitude 20/49
Posts: 7,677
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Kiva for micro-financing
Quote:
Originally Posted by ghsebldr
Try Kiva. I find it more as an investment in the small business person applying for the loan. I have invested around $400 (actually more like donated) and have now helped over 25 individuals grow their businesses.
You can pick the country or region you want your help to go to as well as the industry, I usually choose the agriculture industry, then pick the individual you want to help. I will probably never withdraw my original investment and as I get paid back I am able to offer help to others. It's a nice feeling when your original loan is paid back you get to re-loan it to someone else. After 6 years I haven't been stiffed on a loan yet.
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I really like the concept. I looked at Kiva for investing in Mexico. I found that the bank charges for micro-financing were too high. Do you have any suggestions? Puerto Vallarta is my preferred investment location.
__________________
For the fun of it...Keith
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05-10-2015, 08:06 PM
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#9
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Full time employment: Posting here.
Join Date: May 2015
Posts: 528
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Quote:
Originally Posted by Senator
I thought about it, but decided against it. I am well familiar with credit score, because of tenant screening, and if I was going to do it, I would make sure everyone has at least a 650 credit score.
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I've seen the Lending Club min 660 number in various articles.
Quote:
The minimum FICO credit score needed to get a loan for Lending Club is 660. For Prosper, the minimum credit score is 640.
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90% of borrowers are supposedly rejected from Lending Club applications. It is not in their *long*term* interest to have borrowers default.
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