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I poked around the available loans for a while and it looks like most of them are people trying to consolidate debt. So if the interest rate on the loan they get is better than the interest rate on the debt they already have they come out ahead. There are a few home improvement ones too and those tend to be (again, from about 15 minutes of poking around) the really low interest/low risk loans.
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Nov 21, 2012 21:46
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| # ¿ Apr 25, 2024 14:22 |
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Most of the people that are getting the ~27% loans look like they'd be better served with bankruptcy. I put $250 on the site and I'm going to put some away on there every month, but I'm sticking to C rated and above loans.
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Nov 21, 2012 21:51
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Yeah, I haven't bought anything yet and from looking through I might reevaluate the "c and up" thing. You can see how much their payment will be, their income, their employer, etc. I'm seeing some rated C or B that look kind of not good and some rated below that look relatively safe. I'll poke around that site a bit.
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Nov 21, 2012 22:05
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It's just compound interest basically, right? If a bank took the interest that you savings account generated and put it in a non-interest generating account and you never moved it to the savings account then you would have a lower rate of return. Due to how a savings account is structured they don't do that, but the math (assuming no delinquent notes) works out the same, right?
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Dec 5, 2012 09:40
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Right, but when you get those payments and then reinvest them that's where it becomes compound interest, in my head anyway. Am I approaching this wrong?
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Dec 5, 2012 17:41
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Yes, and the search tools make it pretty quick and easy to filter and search for the type loan you want to give.
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Dec 9, 2012 07:44
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I just had my first missed payment, on an A5. He made the first 4 payments and has only missed one so hopefully it works out.
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Mar 27, 2013 19:23
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Provided you have the means to make the payments on your 20k loan if all of your notes go tits-up I wouldn't think they'd have a problem; they're getting you coming and going.
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May 14, 2013 22:52
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Oh yeah, it's a terrible idea. I just don't think the company would bar it.
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May 14, 2013 22:57
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| # ¿ Apr 25, 2024 14:22 |
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Loans are graded A-F (I think the bottom is F) and also have a number to further refine the grading. So an A-1 is the safest, an A-2 is very safe but less than an A-1, etc. A B-1 is a high grade for a loan, which means they project you are very likely to pay it back, which is why your interest rate (alternatively your investors potential profits) is low relative to lower graded notes.
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Nov 19, 2013 03:36
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