Print

[baeventures]

sigh...wonderfully constructive

[rogerwaite]

Welcome and love your screen name and level headed attitude.  I got into Prosper because I am an experienced consumer of credit.  People say - invest in what you buy.  I looked at Prosper's stats back when and saw C paper defaulting too much.  D paper less so, so I built a model assuming that D paper represented those who had bottomed out and where trying to restore their credit, whereas C paper represented those who were still on their way down.  I 'protected' the D paper by lending to an equal amount of B or better paper.  I lent $5200 using primarily the automatic bidding and some manual bids.  My portfolio is nearing 50% default.  I will probably loose about $600.  Still, I could have spent that on a college course in finance and not learned what I have here, so I will consider it money well spent.  You don't seem to need that education.

Interestingly, my manual bids have out done the auto bids, except that too many of them paid in full early on.  Even more interesting is the 'What if' on Eric's.  A heavier proportion of the A and B paper that was auto bidding wound up defaulting. Gives me a big Hmmmm..  I have wondered whether the auto bidding was somehow manipulated by Prosper.  You can see my stuff under Mrbalingwire.

I wish you well, but I wish I had found this site before I invested. It's good that you are in a holding pattern.

[blue]

I looked at Prosper's stats back when and saw C paper defaulting too much.  D paper less so, so I built a model assuming that D paper represented those who had bottomed out and where trying to restore their credit, whereas C paper represented those who were still on their way down.  I 'protected' the D paper by lending to an equal amount of B or better paper.  I lent $5200 using primarily the automatic bidding and some manual bids.  My portfolio is nearing 50% default.  I will probably loose about $600. 

Roger - your post gave me a thought... http://www.prospers.org/forum/are_credit_grades_relevant-t19972.0.html;msg355293#msg355293  (not sure if I did the link correctly)

[onthefence]

Interestingly, my manual bids have out done the auto bids, except that too many of them paid in full early on.  Even more interesting is the 'What if' on Eric's.  A heavier proportion of the A and B paper that was auto bidding wound up defaulting. Gives me a big Hmmmm..  I have wondered whether the auto bidding was somehow manipulated by Prosper.  You can see my stuff under Mrbalingwire.

When you say auto-bid, do you mean Prosper Portfolio plans?  Because I viewed them as suspect.

Or are you talking about your own autobid creations?  If you are referring to your own concoctions, I would suspect that your manual review helped you to eliminate some real duds.

[Your_Bank]

Welcome and love your screen name and level headed attitude.  I got into Prosper because I am an experienced consumer of credit.  People say - invest in what you buy.  I looked at Prosper's stats back when and saw C paper defaulting too much.  D paper less so, so I built a model assuming that D paper represented those who had bottomed out and where trying to restore their credit, whereas C paper represented those who were still on their way down.  I 'protected' the D paper by lending to an equal amount of B or better paper.  I lent $5200 using primarily the automatic bidding and some manual bids.  My portfolio is nearing 50% default.  I will probably loose about $600.  Still, I could have spent that on a college course in finance and not learned what I have here, so I will consider it money well spent.  You don't seem to need that education.

Interestingly, my manual bids have out done the auto bids, except that too many of them paid in full early on.  Even more interesting is the 'What if' on Eric's.  A heavier proportion of the A and B paper that was auto bidding wound up defaulting. Gives me a big Hmmmm..  I have wondered whether the auto bidding was somehow manipulated by Prosper.  You can see my stuff under Mrbalingwire.

I wish you well, but I wish I had found this site before I invested. It's good that you are in a holding pattern.

Thanks for the note Roger.  Im more concerned with Prospers viability than i am with the credit risk I am taking.  If we indeed find ourselves in a double-dip due to the Europe financial crisis, then all bets are off.

[onthefence]

Thanks for the note Roger.  Im more concerned with Prospers viability than i am with the credit risk I am taking.  If we indeed find ourselves in a double-dip due to the Europe financial crisis, then all bets are off.

To be honest, I don't think the US recession affected Prosper's performance noticeably. 

[kenL]

I don't think the US recession affected Prosper's performance noticeably. 

I think the recession made Prosper's performance go from bad to worse.

[ira01]

I don't think the US recession affected Prosper's performance noticeably.  

I think the recession made Prosper's performance go from bad to worse.

There's no evidence for that assertion.  Prosper's performance was equally terrible from its inception through the end of P1.0.  IIRC, Fred93 wrote a blog article about this.

[Your_Bank]

Holy shit, he's already got 2 lates on a 20 day average loan age.
http://www.ericscc.com/lenders/Your_Bank

I'm very well aware of that.  I was introduced to that site early on.  The 2 lates is on ~150-170 loans, or ~1.5% late in the first month (or 2).  The research I have seen suggests a linear relationship between months held and (PD) probability of default.  i.e.  The highest risk of default is in the first few months.

thoughts.....

I now have a total of 337 loans with an average balance of ~$95.  My first 180 loans totaled $6,000 in lending ($33 avg).  Those have aged between 2-4 months.  My last 160 loans totaled $26,000 ($162 avg), and have not really started paying yet.  The statistics are encouraging from my first batch of loans.  I had 2 <30 day lates and 2 > 30 days lates (the ones Pioneer pointed out above).  Both of the < 30 days are current, and 1 of the >30 (actually was in collections per the note on the page) is in the midst of a manual payment that will make it current.

Obviously, the performance of my last 160 loans will dominate my performace over the next 6 months.  I'm still optomistic on the potential results and am still targeting 12%. Anything less and I'll cease to add any more funding and rotate my funds into a different asset class.  I have decided to take a pause and see how my portfolio performs for several months.  At that point I will evaluate the portfolio and Prospers viability.

Kind Regards,
Y_B

[ira01]

My first 180 loans totaled $6,000 in lending ($33 avg).  Those have aged between 2-4 months.  

You do realize that 2-4 months is nothing, right?  Many, if not most, of us had "green circles" (i.e., no lates or anything else other than current loans) at that stage of our lending.  Except for the rip-off artists, most borrowers make at least their first few payments -- if for no other reason than they are doing so from their borrowed money.  

I have decided to take a pause and see how my portfolio performs for several months.  At that point I will evaluate the portfolio and Prospers viability.

That is very wise -- although "several months" is not nearly long enough.  You should wait at least a year.  IIRC, my ROI was still >7% at around the 1 year mark (long after I stopped lending for other reasons related to Prosper's management).  It is now about -2.5%.

[xraider]

With Ira.  I had several loans default after more than two years of payment, and others file bankruptcy at about that time period.

Prosper's collections and bankruptcy reporting is anything but transparent, too.  I have no idea what Prosper is doing, if anything, on my defaults.  I have no idea of the status of my non-discharged bankruptcies.  I have two who filed ch 13 bankruptcies in 2008, and not a word on the status. 

[cowdog]

I had a loan go bad in month 33.

There had been a number of failed payments for months - June, July, and August of 2009, but then a manual payment came in on September 28.

That didn't stop Prosper from charging it off on November 11.

I really suspect Prosper or the collection agency got payments, or is still getting payments, but not crediting them to me.

Now, for me to even suspect this shows how I view Prosper's honesty and integrity. This is the track record they have with me at this point, and this is not conducive to any further financial dealings under any circumstances.

Of course there is no way to discuss the loan with anyone at Prosper or with the borrower, no original accounting of any sort, nothing in writing or even a verbal affirmation of what happened with the loan, no reason why the decision was made to charge it off even though a payment was made, no record of any contact from collections, no feedback of any sort except the notation: Charged off, in collections.

http://www.prosper.com/invest/listing.aspx?listingID=44357

 
 

[Your_Bank]

I had a loan go bad in month 33.
 

Id be happy if all my loans were current until 33 months and then they ALL defaulted.

[pioneer11]

I had a loan go bad in month 33.
 

Id be happy if all my loans were current until 33 months and then they ALL defaulted.

Just wanted to lock that in.

[onthefence]

Obviously, the performance of my last 160 loans will dominate my performace over the next 6 months.  I'm still optomistic on the potential results and am still targeting 12%. Anything less and I'll cease to add any more funding and rotate my funds into a different asset class.  I have decided to take a pause and see how my portfolio performs for several months.  At that point I will evaluate the portfolio and Prospers viability.

Wise choice.  All to often we see new lenders getting lulled into a false sense of performance at the early stages of lending.  The false expectations created by Prosper's marketing them is part of the problem.  The other half of the problem is how the rate of return appears in the early stages of lending appear, which initially seems to support what Prosper's marketing team advertises.



I certainly hope you do beat lender's past performance on Prosper.