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Savings Account Rates at Local Banks or Why I love P2P Loans

I am often asked why I like to utilize peer to peer lending and other related questions like “Is it risky?” The biggest reason why I am so excited about

What Types of Loans Can I Invest In on Prosper.com?

The Prosper.com loan site lists 11 different types of loans that are available. Those loans are: Debt Consolidation Home Improvement Short Term & Bridge Loans Auto & Vehicle Loans Small

BTCJam: Providing More Info but Still Falling Short

There’s quite a bit of debate in the Bitcoin Investing world about BTCJam. They are without question the largest BTC based peer lending platform and they have the most VC

Legal Corner: The Legal Basis of How Prosper and P2P Lending Works

by Jonathan Wilson, securities attorney at Taylor English Duma [Again, my comments will be in the braces otherwise this is all from our legal expert. None of this is personal

Calculating Returns: IRR or XIRR vs ROI

There’s been much debate in the blogging world for p2p lending about how to calculate returns on our loan portfolios.  Some very prominent people in our industry, including Peter Renton

How does Prosper.com rate its loans?

So let’s jump right in. How Does Prosper.com rate its loans? Prosper.com is one of the leading peer to peer lending sites on the web today. Prosper was the first

The Fitch P2P Lending Report: 5 Things They Got Right and 3 Things They Got Wrong

The Fitch ratings agency, who along with Standard & Poor’s are the 2 largest US based ratings agencies just released their first report on Peer to Peer Lending. While the

Legal Corner: Why I can invest with Lending Club but not with Circleback Lending

Our legal eagle, Jonathan Wilson, is back with some more great info for us on why we can invest in some lending platforms but not others. He’s from Taylor English

Legal Corner: The Securities Act of 1934 and Peer to Peer Lending

By Jonathan Wilson, atty at Taylor English Duma In my last two posts I talked about the definition of a “security” and how that term is defined in federal securities

P2P Lending Best Practices: Why Filtering by State is Nonsense

One of the things I love about p2p lending is due to the platforms being online and most of the early adopters/investors being techies means that lots of people are

The Bitcoin Investor’s Guide to Taxes

The signs of early spring are here and they include warmer weather, pollen and hay fever, putting the winter coats away, and TAXES. Bitcoin investors and lenders, especially those in the US, have some quirky laws that they have to deal with in order to stay compliant. As I talked about in a previous post, Bitcoin is taxed like property in the US. This means that we have to do the same things with Bitcoin that we do with stock and bond investments and we have to track them the same way without Click Here To Continue

BTCJam Makes 3 Big Changes

One of the fun things about following peer to peer/marketplace lending is that things are always changing. Sometimes they are good changes, sometimes they aren't. Sometimes they are just changes and we can't tell if they are good or bad either in the short or long term.  Things are changing even more and faster in the Bitcoin lending market. BTCJam has made 3 such changes that are worth noting. 5 Currencies Added to Locked Loans Just like how BitLendingClub (BLC) added the Brazilian Real to Click Here To Continue

BitLendingClub adds a new Currency Locked loan

A huge announcement this morning from the Bitcoin lending platform, BitLendingClub.  They announced on their blog that they have a new currency for linked loans other than the USD. To review, USD loans used to be linked to Bitstamp and now they are linked to Bitfinex in order to lock in an exchange rate between USD and BTC for repayment.  (Disclosure: I lend on Bitfinex as well although its a little different than standard BTC peer to peer lending). This means a US based borrower can lock in Click Here To Continue

5 Reasons Why Understanding Bitcoin is not required to lend it

Bitcoin, and specifically Bitcoin (BTC) based peer lending, is a prominent topic here. A common misconception is that knowing and understanding all the technological and other underpinnings of Bitcoin's use as a medium of exchange and a currency is vitally important to lending in BTC. It isn't. In fact, it is not important at all. Here are five reasons why: We Don't Understand the Underpinnings of the USD but use it anyway The Federal Reserve regularly publishes information not just on Click Here To Continue

Stu’s Portfolio Report: January 2015

One of the biggest benefits to me personally for doing these monthly reports that I present to you is actually witnessing the changes in my returns in my loan portfolio for myself. I get to see how my Prosper, Lending Club and Bitcoin based returns vary from month to month. My Bitcoin returns in particular can vary quite greatly.  January was a terrific month for my portfolio so let's take a look. One final note, my new High Rate Portfolio did not start until February so my first report on it Click Here To Continue

Big Data in P2P Lending Don’t Be Misled Part 2

Over a year ago, I did a post about big data and peer to peer lending. Big data was all the rage in terms of creating filters for loan selection, and still is for many small investors. Everyone was slicing and dicing the data including stupid things like if FL has more defaults than other states, then don't lend to FL residents.  The 'logic' in this method means we are clearly excluding many outstanding FL borrowers. My 3 factors in this year old post of why not to be misled by big data still apply. Now Click Here To Continue

BTCJam Tightens Up the Ship With 2 New Hires

BTCJam is both the largest and the most controversial of the BTC based lending platforms. Much of the controversy surrounds trust issues in the platform. Some of Jam's shortcomings have led investors to believe that they care about posting loans and generating fees more than they care about protecting those that invest in loans on their platform. Even those like me who believe their shortcomings are due to being overwhelmed with pressure to perform for their equity investors, it is clear that Click Here To Continue

Peer to Peer Loans, How Do I Love Thee?

Since Valentine's Day is this week, I thought I would adjust popular poem "How Do I Love Thee", otherwise known as Elizabeth Barrett Browning's Sonnet 43 and apply it to our industry. Peer to Peer loans, How do I love thee? Let me count the ways. I love thee to the depth of loans and breadth of loans and height (or at least number of them now available) My interest rate goals reach, when feeling out of sight For the ends of an ideal risk/reward ratio. I love thee to the level of helping everyday Click Here To Continue

What’s Really In the New High Rate Portfolio?

Earlier this week, I announced the creation of a new portfolio that I will be tracking: My High Rate Portfolio.  I also outlined some of the filters and guidelines I'll be using. Per Lending Club's portfolio analyzer tools, here is what I have so far. My weighted average rate of return is a full 18%, which if reached would far exceed my goal of 15%. Of course, we know that defaults will happen and the chance of me (or you) achieving 18% due to 100% repayment is virtually nil. However, this Click Here To Continue

Announcement: New Portfolio Added

As a commercial credit analyst by trade, my credit and investing philosophy is to control risk first and then maximize the return I can get for the risk that I am willing to take. Many of you know by now that I quantify this goal by trying to earn 1% per month which annualizes to 12%. One of the most common questions I'm asked is that if my Credit analysis techniques are so good, why not use them to filter out bad loans and seek out the highest return possible?  Since I take pride in sharing Click Here To Continue