{"id":101,"date":"2009-08-22T21:20:19","date_gmt":"2009-08-23T03:20:19","guid":{"rendered":"http:\/\/dennissherman.com\/dennis\/?p=101"},"modified":"2009-08-23T09:10:08","modified_gmt":"2009-08-23T15:10:08","slug":"p2p-lending","status":"publish","type":"post","link":"http:\/\/dennissherman.com\/dennis\/2009\/08\/p2p-lending\/","title":{"rendered":"P2P Lending"},"content":{"rendered":"<p>In an effort to further diversify my investments, I&#8217;ve been looking in to Peer to Peer Lending.\u00a0 There are different risks than with stocks or bonds, which is important for diversification.\u00a0 See <a title=\"Peer to Peer Lending\" href=\"http:\/\/en.wikipedia.org\/wiki\/Person-to-person_lending\" target=\"_blank\">Wikipedia article<\/a>.\u00a0 The article at <a href=\"http:\/\/www.peerlendingwealth.com:8080\/PeerToPeerLending\/P2PLoans.html\" target=\"_blank\">http:\/\/www.peerlendingwealth.com:8080\/PeerToPeerLending\/P2PLoans.html<\/a> is also very informative and persuasive.\u00a0 And a Google search is always a good idea.<\/p>\n<p>After doing my research, I&#8217;ve opened an investor account with <a href=\"http:\/\/www.lendingclub.com\" target=\"_blank\">LendingClub<\/a>.\u00a0 There are other web sites that provide a similar service, this is the one that made the most sense to me.\u00a0 I liked the work they put in to qualify borrowers before their loan is put up for funding.\u00a0 I liked that the loans are all for a fixed period of time, and a known interest rate up front.\u00a0\u00a0 And I liked the amount of information about the borrower, and being able to browse the borrower&#8217;s explanation of what a loan is for.<\/p>\n<p>At LendingClub, the mechanics are that I put money into my account, and use that money to fund a part of one or more loans, providing a minimum of $25 to each loan I choose to fund.\u00a0 For diversification purposes, I&#8217;d like to fund a maximum number of loans, so they&#8217;ll each get a small amount from me.<\/p>\n<p>To start with, I&#8217;m using these criteria to select loans I will fund:<\/p>\n<ul>\n<li>Borrower credit score 714 &gt;<\/li>\n<li>Borrower has 0 delinquencies in the last 2 years<\/li>\n<li>Borrower DTI (Debt to Income) ratio &lt; 10%<\/li>\n<li>Borrower stable employment<\/li>\n<li>The loan description must show reasonably good spelling and grammar, and actually explain why the borrower wants the loan<\/li>\n<li>The loan description must give me the impression the borrower has a reasonable grasp of financial reality<\/li>\n<li>Be selective about business loans &#8211; carefully consider what it is for, and how it will be paid back if the business fails<\/li>\n<li>Look at the number of credit lines open, the revolving credit balance, and the revolving line utilization.\u00a0 I&#8217;m not sure yet exactly what my hard boundaries are on these metrics for a yes\/no decision.\u00a0 I know that a revolving line utilization of 80% makes me too nervous to invest in that loan!<\/li>\n<\/ul>\n<p>And I&#8217;ll see what kind of returns I actually get.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>In an effort to further diversify my investments, I&#8217;ve been looking in to Peer to Peer Lending.\u00a0 There are different risks than with stocks or bonds, which is important for diversification.\u00a0 See Wikipedia article.\u00a0 The article at http:\/\/www.peerlendingwealth.com:8080\/PeerToPeerLending\/P2PLoans.html is also very informative and persuasive.\u00a0 And a Google search is always a good idea. After doing [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[11],"tags":[],"_links":{"self":[{"href":"http:\/\/dennissherman.com\/dennis\/wp-json\/wp\/v2\/posts\/101"}],"collection":[{"href":"http:\/\/dennissherman.com\/dennis\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/dennissherman.com\/dennis\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/dennissherman.com\/dennis\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/dennissherman.com\/dennis\/wp-json\/wp\/v2\/comments?post=101"}],"version-history":[{"count":4,"href":"http:\/\/dennissherman.com\/dennis\/wp-json\/wp\/v2\/posts\/101\/revisions"}],"predecessor-version":[{"id":105,"href":"http:\/\/dennissherman.com\/dennis\/wp-json\/wp\/v2\/posts\/101\/revisions\/105"}],"wp:attachment":[{"href":"http:\/\/dennissherman.com\/dennis\/wp-json\/wp\/v2\/media?parent=101"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/dennissherman.com\/dennis\/wp-json\/wp\/v2\/categories?post=101"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/dennissherman.com\/dennis\/wp-json\/wp\/v2\/tags?post=101"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}