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[312lender]

Lend to people who have made 30+ payments on previous prosper loans.  Check out their performance in the marketplace data.  The loans are relatively young, but the look promising. 

[TotoMMB]

Welcome, I like your assessment of the situation. In the old days I think Prosper was lending to many sub-subprime borrowers, but now they've upped the borrower bar quite a bit.

Prosper technically only lent to the borrowers they had the backing for...so really, it was the individual lenders (i.e. backers - so as not to confuse w/ Prosper Inc.) fault. I think the minimum level of borrower has gone up, but I think the quality at which lenders fund has also been raised.

Like a micro version of housing...Prosper looks good when times are good. When the broader market (and/or financial situation of individuals) goes the wrong way, Prosper loan defaults rise. I'd imagine if I were a borrower and I had to choose between paying Citibank or paying 150 strangers, I'd pay Citibank (or neither, in some cases).

Y_B, also look at borrowers reflective-rupee and b0b:

http://www.ericscc.com/lenders/reflective-rupee
http://www.ericscc.com/lenders/b0b

reflective-rupee came from nowhere and has loaned out nearly $500K since Sept. '09. He's had a few conversations with folks from here (but not ON here) and most suspect he's an insider. Not dealing in extra info, just possibly playing with house money. So, since his arrival, he's provided more than 3% of the funding for completed loans.

b0b is running a similar campaign to yours, albeit on a smaller level ($1,000 over 40 loans). He's got a blog detailing his experience. He followed Prosper for a long time (nearly 3 years), but only started lending in Feb. of this year.

Good luck.

[Your_Bank]

We all wish you luck with your portfolio.  It WAS fun. which is why I loaned for nine months.  It stopped being fun when I realized that Prosper management and I did not share the same interests. 

That is troubling, because prosper management has to be aligned with its lenders or it will fail.  Lenders must make money (enough to compensate for the risk).  If lenders don't make money, they will go away (like most of you have).  You can't run a business where the majority of your customers are losing money.

[Your_Bank]

Welcome, I like your assessment of the situation. In the old days I think Prosper was lending to many sub-subprime borrowers, but now they've upped the borrower bar quite a bit.

Prosper technically only lent to the borrowers they had the backing for...so really, it was the individual lenders (i.e. backers - so as not to confuse w/ Prosper Inc.) fault. I think the minimum level of borrower has gone up, but I think the quality at which lenders fund has also been raised.

Like a micro version of housing...Prosper looks good when times are good. When the broader market (and/or financial situation of individuals) goes the wrong way, Prosper loan defaults rise. I'd imagine if I were a borrower and I had to choose between paying Citibank or paying 150 strangers, I'd pay Citibank (or neither, in some cases).

Y_B, also look at borrowers reflective-rupee and b0b:

http://www.ericscc.com/lenders/reflective-rupee
http://www.ericscc.com/lenders/b0b

reflective-rupee came from nowhere and has loaned out nearly $500K since Sept. '09. He's had a few conversations with folks from here (but not ON here) and most suspect he's an insider. Not dealing in extra info, just possibly playing with house money. So, since his arrival, he's provided more than 3% of the funding for completed loans.

b0b is running a similar campaign to yours, albeit on a smaller level ($1,000 over 40 loans). He's got a blog detailing his experience. He followed Prosper for a long time (nearly 3 years), but only started lending in Feb. of this year.

Good luck.

Thanks.  I've seen reflective-rupee in prosper.  He is obviously the largest current lender, although Aberdeen is close behind.  His profile says he's based in CA, and I usually like the loans he bids on.  His strategy is similar to mine (or I might say I've adopted a strategy similar to his since he was lending first).  I was thinking of dropping him a note.  Has anyone made contact with him that is willing to share info?

I'll check out Bob.  His profile has not stuck out.

[pioneer11]

We all wish you luck with your portfolio.  It WAS fun. which is why I loaned for nine months.  It stopped being fun when I realized that Prosper management and I did not share the same interests. 

That is troubling, because prosper management has to be aligned with its lenders or it will fail.  Lenders must make money (enough to compensate for the risk).  If lenders don't make money, they will go away (like most of you have).  You can't run a business where the majority of your customers are losing money.

Yes, that is what we have been saying around here for a couple of years.

[Mtnchick]

We all wish you luck with your portfolio.  It WAS fun. which is why I loaned for nine months.  It stopped being fun when I realized that Prosper management and I did not share the same interests. 

That is troubling, because prosper management has to be aligned with its lenders or it will fail.  Lenders must make money (enough to compensate for the risk).  If lenders don't make money, they will go away (like most of you have).  You can't run a business where the majority of your customers are losing money.

As you read this board, you will that it's not the issue of losing money (in fact, many have made money) but Prosper's management not only ignoring the pleas of the lenders, but bending over backwards to kick them in the face. They had an INCREDIBLE amount of free expertise they could have used and used well. Instead they did everything they could to silence lenders. It's why I stopped lending.

[Your_Bank]

We all wish you luck with your portfolio.  It WAS fun. which is why I loaned for nine months.  It stopped being fun when I realized that Prosper management and I did not share the same interests. 

That is troubling, because prosper management has to be aligned with its lenders or it will fail.  Lenders must make money (enough to compensate for the risk).  If lenders don't make money, they will go away (like most of you have).  You can't run a business where the majority of your customers are losing money.

Yes, that is what we have been saying around here for a couple of years.

I am getting that point loud and clear.  I am suggesting that most of you jumped in at the wrong time (I'm no better than you for waiting, my excuse is I didn't know about P2P or I probobly would have put some money in it too).  I suspect people on lendingclub had equally pitiful results during the capital/liquidity crisis of 2008/2009. (any research done on that?)  My theory is all about the timing of entry.  Problem I am having is finding a unbiased opinion since most the people on this board have lost money investing in prosper, it is hard to seperate business vs. personal when you loan out your hard earned money.

[Your_Bank]

We all wish you luck with your portfolio.  It WAS fun. which is why I loaned for nine months.  It stopped being fun when I realized that Prosper management and I did not share the same interests. 

That is troubling, because prosper management has to be aligned with its lenders or it will fail.  Lenders must make money (enough to compensate for the risk).  If lenders don't make money, they will go away (like most of you have).  You can't run a business where the majority of your customers are losing money.

Thanks for the thought.  Are investors happy with lendingclub?
As you read this board, you will that it's not the issue of losing money (in fact, many have made money) but Prosper's management not only ignoring the pleas of the lenders, but bending over backwards to kick them in the face. They had an INCREDIBLE amount of free expertise they could have used and used well. Instead they did everything they could to silence lenders. It's why I stopped lending.

[Xenon481]

Problem I am having is finding a unbiased opinion since most the people on this board have lost money investing in prosper, it is hard to seperate business vs. personal when you loan out your hard earned money.

Ira, XRaider, Fred93, I and many others all quit lending while we still had significantly positive ROI's. Many (including Fred93) still have significantly positive ROIs, yet still refuse to lend due to Prosper management.

[pioneer11]

Nearly 88% of all Prosper lenders have quit.  We don't know all of the reasons but we do know some of them.

[Cushie]

I'd agree that people jumped in at the wrong time, but it's fundamentally untrue.  Nothing has changed on Prosper's end since then.  Nothing.

[wftrust]

We all wish you luck with your portfolio.  It WAS fun. which is why I loaned for nine months.  It stopped being fun when I realized that Prosper management and I did not share the same interests. 

That is troubling, because prosper management has to be aligned with its lenders or it will fail.  Lenders must make money (enough to compensate for the risk).  If lenders don't make money, they will go away (like most of you have).  You can't run a business where the majority of your customers are losing money.

Now that is an interesting thought.

A little background on me. I was lending a small amount over a period of time. I was exploring, and was willing to eventually put in 6 figures at some point in time. I will have a very small negative when my experiment is all said and done. So it was not worth the risk much less the time involved with finding and bidding and follow-up that was required for this “investment”. In my portfolio I included some loans that were pure “gifts” to people I deemed worthy of a helping hand, even when I realized the likelihood of return was extremely poor. So suspect if I had taken those back out I would have had a slightly positive return. But again not enough to justify the risks. I can and have done better in the marketplace, even during this downturn.

However, I also came to the conclusion during this timeframe that Prospers view of who their customer is, different than mine. While they give good lip service, the proof is in the pudding.

The customer is truly the “lender” not the borrower in my mind.  Prosper is in place to try to bring quality borrowers to the table for “lenders” to loan on.  Without the lender Prosper cannot make any loans. Borrowers will always apply on any platform they think they can use to their best advantage, so they are a dime a dozen.

This and the incomplete verification of personal data left me with a pretty meager outlook on Prospers’ ability to administer my funds in my behalf, and of my being able to select adequate risk levels to invest in. Then since the reopening, while I have seen improvement in the minimum quality of the borrowers, there is still the problem of the non-existent (OK granted minimal) collections and payment follow up since that time.

The other huge problem for me in investing with Prosper now would be the additional risk that is placed on the platform due to the “new” notes remaining property of Prosper, not the “lenders”. So I would now only be an unsecured creditor in line should anything happen to Prosper. Yet another risk level that I would need to be compensated for.

Good luck, and I hope you have a better return than the majority of the folks here. Especially knowing that info you are basing your investing strategy on is incomplete and suspect.

WFT

[SCI]

Hello Your Bank,

I am still lending in Prosper, but only in a very small scale.  I am hoping that it will improve and prove itself over time, but I'm not holding my breath.

I have been lending on Prosper since Nov 2006, I have mostly placed the minimum bids for diversification, and I have worked very hard to find criteria that has a low default rate that can be sustained over time.  The best strategy that I have come up with so far is to bid on loans that have already paid off at least 1 loan with 20+ on time payments, and do NOT have any CURRENT loans with prosper.  I have this criteria in a Porfolio Plan to automatically find listings that match this criteria.

I have an additional Portfolio Plan that finds loans based on the criteria that I was using since before borrowers could have more than one loan, and it is a little more risky because those borrowers haven't already proven themselves in Prosper.

Once I have the Notes, I put them up for auction on Folio at a 6% premium (because I'm not TRYING to sell them but if someone wants them at 6% they can have them, and I sell about 2 Notes a month at that rate).  Most of the time my higher rates are sold and it leaves me with the stronger Notes, as well as a 5% instant return, after Folio's 1% service fee.

Most of my defaults happened early in my experience:

Loans that I bid on in My First 6 months (11 of My 20 Defaults)
66147  djnaki2322 EverydayPeop... HR $50.00 17.00% 12-08-06 Default
66371  amberlee FinancialAss... E $50.00 15.00% 12-11-06 Default
69845  amorrill Fair B $50.00 13.55% 12-18-06 Default
74937  RiverwoodPro... Groundangel A $50.03 13.36% 12-21-06 Default
77139  JODYWOWINC Utopia D $50.04 19.10% 12-29-06 Default
76234  FiNDepenDenc... P2PFinancial C $50.03 17.95% 01-12-07 Default
84140  Heavin MONEYDIES E $50.00 19.95% 01-25-07 Default
93780  daddy3 EverydayPeop... D $50.00 19.63% 02-26-07 Default
101287  FROM671 Consolidator... E $50.00 22.00% 03-02-07 Default
113558  scrubshop EverydayPeop... E $50.00 23.00% 04-02-07 Default
123802  bbrave Lend2 D $50.00 19.00% 04-25-07 Default

My 2nd 6 month Period (7 More)
145252  218phone EverydayPeop... B $50.00 18.00% 06-11-07 Default
147846  jemmcc2003 FINANCE-INVE... D $50.00 18.45% 06-19-07 Default
151128  jlp270 EverydayPeop... HR $50.00 21.49% 06-25-07 Default
161241  VolatileCons... No-Bull-Inve... A $50.00 14.75% 07-16-07 Default
159887  Zenni No-Bull-Inve... B $50.00 16.49% 07-16-07 Default
203013  Payingoff200...  D $50.00 20.41% 09-26-07 Default
203693  OurDreamBiz CashfundersL... D $50.00 20.00% 10-01-07 Default

--at this point, I reviewed all my data, and decided to establish criteria based on a 99% current rate when using Prosper's Performance Page, since Prosper performance data was now old enough to actually analyze.

My 2nd Year (Last 2)
390379  fenris  AA $50.00 19.10% 09-11-08 Default
398281  softparade Engineer AA $50.00 14.75% 09-23-08 Default

So outside of my first year education and the establishing/testing of my criteria, I have had 2 defaults, and since I modified my criteria with Prosper's new grading system, one that will be a default due to bankruptcy (which was one that had two active loans, so I modified my criteria).

Right now my portfolio looks like this:
Principal value of active notes: $1,335.06
Total active notes: 58  View
        Current: 57  View
        Past due (1-30 days): 0  View
        Past due (31+ days): 1  View (will be a default)
        Payoff in progress: 0  View
Total charged-off notes: 20  View
Total notes paid in full: 34  View
Total notes sold: 27  View

Average note yield at acquisition: 18.26%
My default rate including 1st year defaults: 15.10%
My default rate excluding 1st year defaults: 2.47%
My expected ROI: about 6-7% for now

[Trekbiker]

I am getting that point loud and clear.  I am suggesting that most of you jumped in at the wrong time (I'm no better than you for waiting, my excuse is I didn't know about P2P or I probobly would have put some money in it too).  I suspect people on lendingclub had equally pitiful results during the capital/liquidity crisis of 2008/2009. (any research done on that?)  My theory is all about the timing of entry.  Problem I am having is finding a unbiased opinion since most the people on this board have lost money investing in prosper, it is hard to seperate business vs. personal when you loan out your hard earned money.

[/quote]

you are correct.  Practically no one on this forum is lending anymore and we were all the unfortunate early adopters.  My first 200 loans had about a 40% default rate.  at 6-9 months I seriously revised and tightened my lending criteria and the next 425 loans have a default rate of about 20%.  I suspect if I were to try it again with this new version 3.0 Prosper I might be able to get a positive return but the work for that return is more than I want to repeat.

I was originally going to invest 50K and see how it worked before upping that amount substantially.  I stopped at 30K when I realized I was going to lose.  When the last of my loans work thru in late 2011 I figure I will about break even.  Right now I am down $600.  I'm not angry at Prosper and you will no doubt do better than most of the lenders here.  But I would reduce your 50K trial amount to about half or 30K and wait to see if Prosper will survive as a company.  If it goes under its going to be a real hassle getting your money back.

[Staneslav]

a