Wednesday, March 18, 2009

Final Loan Paid Off

I received notification today that I have received the final payment on my last outstanding loan with I'm now finally through with that experiment. I made a total of four loans and two of them defaulted. One was paid in full over the 3 year loan period and one was paid in full early - about 10 months ahead of schedule. I lost about $350 of my $500 investment.

I've said it before and I'll say it again. Lending through Prosper isn't for me. I can get higher rates of return on loans that are secured by real property. Prosper is apparently going through some sort of registration process with the SEC, so they are not currently accepting new lenders or originating new loans from existing lenders. They have been in this state for a couple of months and they give no indication of when they might start lending again. That's got to be hurting their income.

Once the last payment to my account has been finalized in about 2 to 3 days, I'll transfer my money out of Prosper and close my account.


MEG said...

I am wrapping up my Prosper experiment as well. I've been doing it for nearly 3 years and quit making new loans over a year ago. I had a total of about 42 loans, and over a third of them have defaulted. One has paid off early and the rest are still paying (though a few of them are likely headed for charge off due to late payments). So far I've lost a net $1500 out of the $6,000 I the opportunity cost of having that $6000 somewhere else.

la jolla real estate said...

Why for home loans the banks are calculating the interest rate? Do you have any idea?

Shaun said...

I'm not sure what you mean...

Anonymous said...

What exactly is prosper? I am currently looking for a loan. Our house is paid off in full and is valued at around $130000. My wife and I both work and gross about $7000. We are looking to borrow around $25000. Our highest credit score is around 600 so I know it needs some work. With our house paid off would a lender loan us the money?

Shaun said... is a peer-to-peer lending site. You post a request for a loan and other people pool their money and lend it to you. Last time I checked, they were not accepting new loan applications because they were going through some regulatory process. And I don't think you could get a loan of $25,000 there anyway (most loans on Prosper are under $10,000). With your house totally paid off, you should be able to get a loan even with the low credit score. You'll have to accept a higher interest rate though. If large banks turn you down, try a local bank or credit union.

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