More Loans Means More Choices for Investors at Lending Club

Number of available loans at Lending Club

For the first half of this year the number of available loans at Lending Club hovered between 700 and 1,000 loans. Occasionally the number went over 1,000 but it averaged somewhere around 800 loans available to investors at any one time.

But in the month of June this changed. By June 21st there was over 2,000 loans available on the platform, a previously unheard of number. In late July at one stage there was over 2,500 loans available – about triple the historical average. I just took this screenshot above this morning and we are at 1,842 loans right now, below the heady numbers from last month but still more than double the average for this year.

The LC Advisor Funds Investing Huge Amounts in the First Week

Why the big increase in available loans? Simply stated, it is driven by investor demand. For the last several months we have seen this trend where in the first few days of the month at Lending Club very large volumes of loans are issued. In the first week of August that number was the largest ever – over $30 million.

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Thomson Invests Another $25 Million in Lending Club

Today Lending Club announced that Peter Thomson, chairman of Thomvest and Director of the Thomson Reuters Corporation has made another $25 million investment. This is on top of the $25 million that he made back in September last year.

Like many retail investors Thomson decided to get his feet wet (if you can call investing $25 million that) with Lending Club by focusing on the most conservative loans initially. LC Advisors, the investment arm of Lending Club, runs two funds: the Conservative Consumer Credit Fund (CCF) which invests in just A and B grade loans and the Broad-Based Consumer Credit Fund (BBF) which invests in all loan grades. Thomson’s first $25 million went into the conservative fund and this $25 million will go into the broad based fund.

A year ago this would have been really big news. I almost didn’t write about this because a $25 million investment just doesn’t seem that big a deal anymore. Regardless, it is good to know that the big investors are happy with their performance and continue to put new money to work at Lending Club. With $50 million invested it is safe to say the Thomson will likely be Lending Club’s largest investor.

You can read the full press release here.

Every P2P Loan is Getting Funded at Lending Club

It hasn’t happened since September of last year. That was the last time a loan was listed on Lending Club’s platform that did not get funded.

Now, of course, not every listing becomes a successful loan. Some are removed because they fail some form of verification; others are removed by the borrower. But according to Lendstats the last time we saw a valid loan on Lending Club not get funded by investors was in September, 2011.

Good News for Borrowers

So this is good news for any borrower taking out a Lending Club loan. As long as they do everything Lending Club asks of them and all their information on their application is correct their loan will be funded. [Read more…]

Options for Accredited Investors at Lending Club and Prosper

Before I started writing this blog I had no idea what an accredited investor was. It sounded kind of official but what did it really mean? It is actually just a designation by the SEC that an investor has reached certain levels of income ($200,000 annually) or assets (more than $1 million excluding a home). Here is the full definition from the SEC.

Accredited investors have more options because they are considered more sophisticated investors (of course that may or may not be true) and presumably they can understand investment risks better than your average investor. They can invest in all kinds of different investment vehicles such as hedge funds or private equity that are not available to average investors. They can also invest differently when it comes to p2p lending.

Invest in Lending Club and Prosper From Any State

Accredited investors in Lending Club and Prosper do not need to open an account at either company in order to invest. They have access to private placement funds that are not available to the general public.

These private placement funds are allowed to take on accredited investors from any state, thereby circumventing the restrictive state requirements set forth by Lending Club and Prosper.

This Article is Purely Informational

In researching this article and I spoke with many senior managers at Lending Club and Prosper and I was warned that I can only share publicly available information. You see, these private placement funds have strict rules and part of these rules is there can be no public solicitation for investments.

So let me be clear. This post is for information purposes only and I am not recommending investment in these private funds.

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