Has anyone tried investing in peer to peer lending platforms, how has your experience been so far?
I did this for years. Prosper and LendingClub. I quitting all of it. Here’s why: In the beginning, the returns seem attractive 6-10% net returns YOY while distributing your risk over many small loans. This is a farce, your returns will end up being closer to 1-3% once notes mature. Still okay but not worth the subprime junk level of these non-collateralized debt. Also, there is systemic risk that isn’t taken into account. The moment the economy crashes, the defaults will spike and you cannot avoid losses.
p2p lending is uncollateralized, so a lot of people just before filing for bankruptcy, take a loan to get some cash, pay one or two payments, and then default. Also, when someone is late in payments, they send the loan to "professional collectors", which are the people who make the borrower's life hell to get the loan paid back as much as possible. Lending club provides you with the report of each time the colloctor goes after the borrower, which I personally found very distasteful.
Not worth it and there is no early exit. Once a loan is defaulted, it’s gone. At least for stocks there is a hope of bounce back up. Selling notes is also tough.
Tech Industry
Yesterday
4014
11 offers to laid off[UPDATE]: 5 offers
Tech Industry
Yesterday
467
Ever wonder how a few of your coworkers got hired in the first place?
India
Yesterday
339
How to save India from destruction?
Tech Industry
Yesterday
1673
TESLA UP 14% AFTER HOURS 🎉🎉🎉🎉
Tech Industry
Yesterday
535
The new Tesla Model 3 P goes from 0-60 in 2.9 seconds
Not a lot of gains comparing to other investments.