May 6th, 2008 — , Lending Presentation, Prosper Days 2008, Prosper.com, Strategy from LC @ LC's Warm n Fuzzy Prosper Blog
(part 18 of my Prosper Lending Presentation)
If you have followed along to at least this point, then it should be obvious to you that you need to set your own bidding rates to accommodate the risk you’re taking on with each Prosper loan. duh! Don’t chase a rate down too far just because you were outbid and have to be on the loan. There is always a point to let a loan go free without your bid.
Related StoresMay 6th, 2008 — , Lending Presentation, Portfolio Plans, Prosper Days 2008, Prosper.com, Strategy, bidding guidance from LC @ LC's Warm n Fuzzy Prosper Blog
(part 17 of my Prosper Lending Presentation)
As absolutely nifty as Prosper’s new Bidding Guidance and Portfolio Plans are, they just do not have the capability to capture the amount of detail that the manual bidder can.
Let’s consider the Borrower’s description. The way a borrower presents themselves can offer insight into their financial situation. A lot of borrowers these days include a
Related StoresMay 6th, 2008 — , Lending Presentation, Prosper Days 2008, Prosper.com, Strategy, bidding guidance from LC @ LC's Warm n Fuzzy Prosper Blog
(part 16 of my Prosper Lending Presentation)
Just because someone is an AA doesn’t mean they should get a 25k Prosper loan! Based on their income and DTI, they might only be considered an AA for a 1k loan.
Credit Grade is not the only thing the Prosper lender should be looking at. Actually, in my opinion, Credit Grade is quickly becoming a thing of the past.
When Prosper was first launched,
Related StoresMay 6th, 2008 — , Lending Presentation, Prosper Days 2008, Prosper.com, Strategy, bidding guidance from LC @ LC's Warm n Fuzzy Prosper Blog
(part 15 of my Prosper Lending Presentation)
One of the most important things one should consider when looking for listings on Prosper is to find borrowers that are requesting reasonable loan amounts within their capacity to pay you back.
Of course, the income claimed is self reported (although some are verified by Prosper), but that’s all we have, so we have to rely on it (with a healthy dose
Related StoresApril 15th, 2008 — , Lending Presentation from LC @ LC's Warm n Fuzzy Prosper Blog
After a much needed blogging break last week, I’m back.
At the moment, I’m in the middle of my PD08 Lending Presentation series, but I’m gonna have to put that on hold while I post about some other stuff.
Have no fear. To view all the presentation posts together, just view the tag “Lending Presentation”, or click here…
*enter chirping crickets*
Related StoresApril 5th, 2008 — , Lending Presentation, Portfolio Plans, Prosper Days 2008, Prosper.com, ROI, Strategy from LC @ LC's Warm n Fuzzy Prosper Blog
Quick Chimp Tip for the New Lender # 12
(part 14 of my Prosper Lending Presentation)
Diving head first into Prosper Lending without doing your own due diligence is like cliff diving without checking out the water below first. Prosper is, after all, only two years old. The data is young. The data is thin.
Relying on a numbers only approach could be dangerous if you don’t know what you’re doing
Related StoresApril 4th, 2008 — , Lending Presentation, Prosper Days 2008, Prosper.com, Strategy, late from LC @ LC's Warm n Fuzzy Prosper Blog
Quick Chimp Tip for the New Lender # 11
(part 13 of my Prosper Lending Presentation)
Instead of getting upset over late loans, the best thing you can do is analyze the late loan and learn how to avoid similar loans in the future.
Sure, you can always go to Eric’s cool website to look up late loans and learn from those, but when you’re on a loan that goes late and have real money at stake, the
Related StoresApril 4th, 2008 — , Lending Presentation, Prosper Days 2008, Prosper.com, late from LC @ LC's Warm n Fuzzy Prosper Blog
Quick Chimp Tip for the New Lender # 10
(part 12 of my Prosper Lending Presentation)
Instead of getting upset over late loans, just sit back, take a deep breath, and relax.
Remember, there isn’t anything you can do about it anyway. Don’t let a late loan spoil your day…
April 3rd, 2008 — , Defaults, Lending Presentation, Prosper Days 2008, Prosper.com, late from LC @ LC's Warm n Fuzzy Prosper Blog
Quick Chimp Tip for the New Lender # 9
(part 11 of my Prosper Lending Presentation)
When your loans start going late, don’t get mad. There’s really not much you can do about it anyway.
You could yell and scream like the loan chimp you are, but that doesn’t result in anything but a broken monitor and high blood pressure…
Related StoresApril 2nd, 2008 — , Defaults, Lending Presentation, Portfolio Plans, Prosper Days 2008, Strategy, late from LC @ LC's Warm n Fuzzy Prosper Blog
Quick Chimp Tip for the New Lender # 8
(part 10 of my Prosper Lending Presentation)
So you’re relatively new to Prosper and have been happily bidding away. You’ve been careful about the loans you’ve selected, and you’re quietly cheering on each one of your borrowers; like that nice family with the cute baby, the pretty girl that is about to graduate from college, and that guy that wants to
Related StoresApril 1st, 2008 — , Lending Presentation, Prosper Days 2008, Prosper.com, Strategy from LC @ LC's Warm n Fuzzy Prosper Blog
(part 9 of my Prosper Lending Presentation)
#6 – Ask Questions…
Many times, there are some holes in the information we receive about a listing. Sometimes, what the borrower states in the Listing Description isn’t entirely clear and needs clarification. Also, while we’re given quite a bit of credit detail about the borrower, it’s still not a full blown credit report. Sometimes the numbers just
Related StoresContinue reading → Quick Chimp Tip for the New Lender – 6 & 7
March 31st, 2008 — , Lending Presentation, Prosper Days 2008, Prosper.com, Strategy from LC @ LC's Warm n Fuzzy Prosper Blog
(part 8 of my Prosper Lending Presentation)
#5 – Read Between the Lines
One of the most fascinating aspects of Prosper lending is the Listing Description. This is the chance for the borrower to explain why they need the loan. Often, borrowers use it to try to convince you that they’re not as bad of a risk as the credit details might suggest.
There are many similarities between Prosper Listing
Related StoresMarch 31st, 2008 — , Lending Presentation, Prosper Days 2008, Prosper.com, Strategy from LC @ LC's Warm n Fuzzy Prosper Blog
(part 7 of my Prosper Lending Presentation)
#4 – Consider Each Listing Carefully
The Prosper lender is given a good deal of credit information about each borrower. Often I catch myself only focusing on a few pieces of the data, overlooking the rest. It’s all important!
On top of the credit data, we are also provided (directly by the borrower) the listing description, pictures, question answers
Related StoresMarch 28th, 2008 — , Lending Presentation, Prosper Days 2008, Prosper.com, ROI, Strategy from LC @ LC's Warm n Fuzzy Prosper Blog
(part 6 of my Prosper Lending Presentation)
#3 - Don’t Gamble with your Bids
Have you ever found yourself unsure about a listing but hopelessly drawn to that high and juicy interest rate? If you’re unsure about a borrowers ability to pay you back, chances are they probably can’t.
All it takes is one bad loan on a relatively small number of loans to really kill your ROI. J9359 recently had a
Related StoresMarch 28th, 2008 — , Lending Presentation, Prosper Days 2008, Prosper.com, ROI, Strategy from LC @ LC's Warm n Fuzzy Prosper Blog
(part 6 of my Prosper Lending Presentation)
#3 - Don’t Gamble with your Bids
Have you ever found yourself unsure about a listing but hopelessly drawn to that high and juicy interest rate? If you’re unsure about a borrowers ability to pay you back, chances are they probably can’t.
All it takes is one bad loan on a relatively small number of loans to really kill your ROI. J9359 recently had a
Related StoresMarch 26th, 2008 — , Lending Presentation, Prosper Days 2008, Prosper.com, Strategy from LC @ LC's Warm n Fuzzy Prosper Blog
(part 5 of my Prosper Lending Presentation)
#2 - Prosper Loans are not Handouts
As a Prosper lender, you’re going to read all kinds of sob stories and hard luck cases presented by potential borrowers. Some of the stories might be true, but there is also a high likelihood that most stories are highly embellished tales meant to tug at your heartstrings – and your cash.
Avoid sob stories and
Related StoresMarch 26th, 2008 — , Lending Presentation, Prosper Days 2008, Prosper.com, Strategy from LC @ LC's Warm n Fuzzy Prosper Blog
(part 5 of my Prosper Lending Presentation)
#2 - Prosper Loans are not Handouts
As a Prosper lender, you’re going to read all kinds of sob stories and hard luck cases presented by potential borrowers. Some of the stories might be true, but there is also a high likelihood that most stories are highly embellished tales meant to tug at your heartstrings – and your cash.
Avoid sob stories and
Related StoresMarch 26th, 2008 — , Defaults, Lending Presentation, Prosper Days 2008, Prosper.com, prospers.org from LC @ LC's Warm n Fuzzy Prosper Blog
(part 4 of my Prosper Lending Presentation)
#1 – Admit You’re a Noob
If you’re new to lending on Prosper, and you have no experience lending money to strangers over the internet, then your first order of business is to admit and embrace the fact that you have no idea what you’re doing and have a lot to learn.
If you’re new to lending on Prosper but haven’t done your homework first – buckle
Related StoresMarch 24th, 2008 — , Lending Presentation, Prosper Days 2008, Prosper.com, ROI, Strategy from LC @ LC's Warm n Fuzzy Prosper Blog
(part 3 of my Prosper Lending Presentation)
Average Interest Rate: 12.3%
Average Risk: B grade
Average Loan Age: 388 days
9.7% ROI on Lendingstats
7.9% ROI on Eric’s CC
~ 7.5 % ROI using Excel XIRR
Briefly, here are more stats on my Prosper Lending Portfolio (again, these are more recent figures than what was shown at Prosper Days 08).
OK, so my ROI isn’t exactly “high”, but it’s not bad
Related StoresMarch 24th, 2008 — , Defaults, Lending Presentation, Prosper Days 2008, Prosper.com, late from LC @ LC's Warm n Fuzzy Prosper Blog
(part 2 of my Prosper Lending Presentation)
Joined February 2006$27k Invested373 Total Loans
95 Paid Loans250 Current Loans
6 less than one month late22 one month late or worse
Here is a brief snapshot of my Prosper lending portfolio (these are the most recent figures).
When I first put this together, the item that stood out the most to me was the number of Paid loans in my portfolio. At the
March 20th, 2008 — , Lending Presentation, Prosper Days 2008, Prosper.com from LC @ LC's Warm n Fuzzy Prosper Blog
Loan Sharking vs. Loan Chimping
I would like to start by clearing up a slight misconception some people have about Prosper lenders, labeling our lending activity as “Loan Sharking”. Comparing Prosper lenders to loan sharks is a little unfair. Most lenders participate because they believe in the P2P lending concept - removing banks from the money equation which results in more competitive rates
Related StoresMarch 20th, 2008 — , Lending Presentation, Prosper Days 2008, Prosper.com from LC @ LC's Warm n Fuzzy Prosper Blog
As I mentioned in Part 6 of my Prosper Days Recap, I participated in the High ROI Lender Panel for PD08 and gave a short presentation on Prosper Lending.
I had a lot of fun creating the presentation, and since I spent quite a bit of time putting it together, I figured why limit the material only to PD08 when I can easily present it here on my Warm n Fuzzy blog as well?
The nice thing about this
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