eric seiger
The Morning Line: There's <b>News</b> Beyond Zenyatta - NYTimes.com
Friday's horse racing roundup, including a look at the day's Breeders' Cup races.
Fox <b>News</b> Ratings on Election Night Beat Networks - NYTimes.com
The Fox News Channel's midterm election coverage attracted more viewers than any of the broadcast networks' coverage, according to the Nielsen Company.
Even FOX <b>News</b> Not Hiring Christine O'Donnell
FOX News not doing something is always a banner news item. They also didn't burn down the Empire State building today or march naked through Times Square. Don't miss writing news copy about that! ...
eric seiger
eric seiger
The Morning Line: There's <b>News</b> Beyond Zenyatta - NYTimes.com
Friday's horse racing roundup, including a look at the day's Breeders' Cup races.
Fox <b>News</b> Ratings on Election Night Beat Networks - NYTimes.com
The Fox News Channel's midterm election coverage attracted more viewers than any of the broadcast networks' coverage, according to the Nielsen Company.
Even FOX <b>News</b> Not Hiring Christine O'Donnell
FOX News not doing something is always a banner news item. They also didn't burn down the Empire State building today or march naked through Times Square. Don't miss writing news copy about that! ...
eric seiger
eric seiger
eric seiger
The Morning Line: There's <b>News</b> Beyond Zenyatta - NYTimes.com
Friday's horse racing roundup, including a look at the day's Breeders' Cup races.
Fox <b>News</b> Ratings on Election Night Beat Networks - NYTimes.com
The Fox News Channel's midterm election coverage attracted more viewers than any of the broadcast networks' coverage, according to the Nielsen Company.
Even FOX <b>News</b> Not Hiring Christine O'Donnell
FOX News not doing something is always a banner news item. They also didn't burn down the Empire State building today or march naked through Times Square. Don't miss writing news copy about that! ...
eric seiger
eric seiger
eric seiger
The Morning Line: There's <b>News</b> Beyond Zenyatta - NYTimes.com
Friday's horse racing roundup, including a look at the day's Breeders' Cup races.
Fox <b>News</b> Ratings on Election Night Beat Networks - NYTimes.com
The Fox News Channel's midterm election coverage attracted more viewers than any of the broadcast networks' coverage, according to the Nielsen Company.
Even FOX <b>News</b> Not Hiring Christine O'Donnell
FOX News not doing something is always a banner news item. They also didn't burn down the Empire State building today or march naked through Times Square. Don't miss writing news copy about that! ...
eric seiger
eric seiger
The Morning Line: There's <b>News</b> Beyond Zenyatta - NYTimes.com
Friday's horse racing roundup, including a look at the day's Breeders' Cup races.
Fox <b>News</b> Ratings on Election Night Beat Networks - NYTimes.com
The Fox News Channel's midterm election coverage attracted more viewers than any of the broadcast networks' coverage, according to the Nielsen Company.
Even FOX <b>News</b> Not Hiring Christine O'Donnell
FOX News not doing something is always a banner news item. They also didn't burn down the Empire State building today or march naked through Times Square. Don't miss writing news copy about that! ...
eric seiger
The Morning Line: There's <b>News</b> Beyond Zenyatta - NYTimes.com
Friday's horse racing roundup, including a look at the day's Breeders' Cup races.
Fox <b>News</b> Ratings on Election Night Beat Networks - NYTimes.com
The Fox News Channel's midterm election coverage attracted more viewers than any of the broadcast networks' coverage, according to the Nielsen Company.
Even FOX <b>News</b> Not Hiring Christine O'Donnell
FOX News not doing something is always a banner news item. They also didn't burn down the Empire State building today or march naked through Times Square. Don't miss writing news copy about that! ...
eric seiger
The Morning Line: There's <b>News</b> Beyond Zenyatta - NYTimes.com
Friday's horse racing roundup, including a look at the day's Breeders' Cup races.
Fox <b>News</b> Ratings on Election Night Beat Networks - NYTimes.com
The Fox News Channel's midterm election coverage attracted more viewers than any of the broadcast networks' coverage, according to the Nielsen Company.
Even FOX <b>News</b> Not Hiring Christine O'Donnell
FOX News not doing something is always a banner news item. They also didn't burn down the Empire State building today or march naked through Times Square. Don't miss writing news copy about that! ...
eric seiger eric seiger
eric seiger
eric seiger
eric seiger
The Morning Line: There's <b>News</b> Beyond Zenyatta - NYTimes.com
Friday's horse racing roundup, including a look at the day's Breeders' Cup races.
Fox <b>News</b> Ratings on Election Night Beat Networks - NYTimes.com
The Fox News Channel's midterm election coverage attracted more viewers than any of the broadcast networks' coverage, according to the Nielsen Company.
Even FOX <b>News</b> Not Hiring Christine O'Donnell
FOX News not doing something is always a banner news item. They also didn't burn down the Empire State building today or march naked through Times Square. Don't miss writing news copy about that! ...
big seminar 14
These are my personal guidelines for bidding on loan requests at Prosper.com, a site meant to be the ebay of loans, founded by Chris Larsen, who also founded eloans.com. This knowledge on how to choose the best borrowers will grow as I grow with Prosper.
My personal challenge is to find the higher rated APR borrowers who are not actually that high of a risk as the APR makes them appear, but for some valid reason or another have high APRs while still being responsible, smart, and savvy people. But you may simply want to bid on lower risk/lower APRs at first till you have the hang of it or just as a matter of personal practice.
As always, only invest money that you can spare, and could afford to lose. This site is a relatively new concept, and although Zopa, a similar site in the UK has been operating longer and is being successful, it is good to let things play out without going overboard.
- Monitor the loans that top Prosper lenders bid on.
- Who are the top ten Prosper lenders by Return on Investment (ROI) and by portfolio size. http://www.lendingstats.com/
- Subscribe to one or more of the top Prosper lenders by ROI at www.proprosper.com. If they have the top return on investment, they must be doing something right. HOWEVER, don't bid on it just because they did because they are not infallible. Read the listing with a fine tooth comb yourself for red flags.
- Start looking in the loans that are 100% funded. Typically there will be a link on Prosper to show you the fully funded loans (further bids by lenders drive the rates down for the borrowers, till the listing ends).
- If you bid on a loan and it does not get 100% funded, you will have to try again (your money is returned to your account). The borrowers either get all or nothing.
- Evaluate the purpose behind the prospective borrower requesting a loan.
- If they want to borrow $3000 for Christmas at 29%, say in their listing that they don't have money for food and utilities but they don't want to disappoint their kids at Christmas time, this is one you want to avoid. If they don't have money for survival now, and are overspending now - and not educating their kids on the realities of life, this will continue into their obligation with a Prosper loan.
- Do they want to use the money to generate more money through creation or expansion of a business? Or are they using it for consumption?
- Are they using it for an elaborate wedding? That's one that I personally would not bid on.
- Are they using the funds to consolidate existing debts with lower interest rates?
- Evaluate how the listing was written:
- Does the person appear smart as well as educated? Do they appear financial savvy? If it is for business, do they appear to have business sense?
- Does the person include a budget of their daily expenses that seems reasonable?
- In the budget does it show how they are able to afford the Prosper payment?
- Does the photo with it support their cause in a good way or does it make them seem like losers? Are they using a photo of themselves in a good way or to be manipulative (photo of a pretty woman and obvious ploys at manipulative.
- Do they affirm that they are responsible and have every intention of paying it back?
- Do they explain any negatives in their credit history in the description area of their listing?
- Regardless of what bad things happened to them in their lives to set them off track, do they have a victim attitude or a winner's attitude?
- Do they get caught up in explaining all the bad things that have happened to them? Or do they have a rock-solid plan for overcoming those obstacles?
- Do they admit that they spend beyond their means, or do they exhibit behaviors of frugality?
- Were the reasons that caused them to need the loan either smart business sense, or personally unavoidable situations that they can recover from with a loan? (medical situations could be unavoidable but they may not necessarily be bad in character just unfortunate).
- Evaluate their credit history statistics - does it help you to have a reasonable confidence that you will get your money back with interest? Or does it make you feel confident that they will default on their obligation?
- Note public records. They should explain them and you can make a determination of whether that's a risk that you want to take.
- Note percentage of credit card debt that they have compared to what they are allowed to owe. In the real, offline world, 30% is about the point where one moves from low risk to higher risk. 96% would be very risky zone. It wouldn't take much to put one over the edge.
- Evaluate their number of past and present delinquencies. Someone with 43 delinquencies (DQs), seems to have made a habit about skipping out on bills - either that, or they have had incredibly bad luck. If they are currently delinquent, will getting a new loan make it worse or better? Example: someone with $3000 in payday loans, to consolidate to get the bad rates to go away would help them to become current again.
- Note number of inquiries - if they have 12 inquiries in the last six months, you have to wonder why they can't get credit anywhere else.
- Note what group they belong to, if any, and the default rates for the group they belong to, as well as how many stars the group has. If the prospective borrower does not have a group, they may have a better chance of defaulting since the group acts as peer pressure, and also because the group leaders of many groups will vet (verify) income statements, taxes, W-2's, etc. so that you know that they have the means to repay. Top Prosper groups: http://www.lendingstats.com/
- Evaluate potential benefit to the prospective borrower: If you bid on a listing with a higher APR as opposed to the less risky/lower APR listings, does this loan benefit them in the long run or are you taking advantage of the situation and not caring what it will do to them? If you run a calculation on a loan amortization spreadsheet you can see how difficult it is to pay off a high rate loan. If you do not benefit the borrower and make them extremely thankful for the service you provided to them, they would be more likely to not follow through. If they are thankful and would rather pay you than a bank, you are set for the next three years, barring unforeseen events which impact their finances. Examples of high rate loans that benefit the borrower:
- The consolidation of payday loans into a Prosper loan, leaving behind astronomical fees that amount to 400-1500% APR if annualized.
- Short term need of business capital, and they don't care what they pay because they will be repaying it quickly, and they are offering a high rate to attract more bids in a short amount of time.
- Someone who has children, and a broken down car who will lose their job if they can't get to work.
- Paying off credit cards that even have HIGHER rates than the rate in their listing.
- Someone establishing credit for good purposes, who has to start out somewhere, and so they have a high rate because they are just beginning.
- Examples of loans which do not benefit the borrower (in my opinion):
- $3000 at 29% APR for Christmas to avoid disappoint the kids.
- $10,000 at medium or high APR for an elaborate wedding.
- $6000 loan at 25% APR for taking a vacation
- Search by category of who you want to lend to - choosing categories of people that seem like they would be lower risk:
- Someone searching for business capital?
- Those in deep with payday loans because they were sooo responsible at keeping up on their bills that they got sucked into predatory loans?
- Homeowners? (You can subscribe to this list by RSS on www.proprosper.com or you can read the list on the site).
- Those who are already fully funded?
- Those who have had Prosper loans before and paid them off?
- Those who have been bid on by the lenders with the top 10 return on investment (ROI)? Top 10 lenders by ROI at www.lendingstats.com and tracking lenders at www.proprosper.com.
- Those whose listings who look promising but you don't know yet whether they will get 100% funded? Or, loans that look promising but are ALMOST funded?
- Prospective borrowers who are also lenders - depending on what the purpose is behind their loan request - a personal need? Or just to lend out again on Prosper? Caution on the concept of arbitrage:It really isn't a good idea for AA and A people or anyone else - to borrow money at 8% or whatever, to go turn around and lend to high risk people. If your whole portfolio goes bad, guess who is stuck with the bill? Yes, you. Anyway, bid with funds that you have, and if you bid on higher rated ones, your returns will be higher than those who borrow money to lend. Borrowers who lend (can be good risk of they have a significant amount invested with Prosper) http://www.lendingstats.com/borrowersWhoLend
10. Repeat borrowers: you must decide for yourself: are they a better risk or a worse risk? It depends on how they propose to use the money. Here is a way to find repeat borrowers: http://www.lendingstats.com/activeListings?repeatBorrower=yes&submit=Generate
11. Debt to income ratio: In their listing, consider their debt to income ratio (DTI) which includes ALL debt, not just percentage of credit card debt. Are they close to 100% or do they have sufficient room for another obligation?
Useful Tools
Simple Loan Amortization Spreadsheet in Excel:http://www.vertex42.com/ExcelTemplates/excel-amortization-spreadsheet.html You can use this to calculate monthly payments on a given amount of money at a given interest rate to determine how investing at a certain percent will play out over three years.
List of Comprehensive data and stats websites for Prosper:http://www.prosperlender.com/ Includes links to the comprehensive data and statistics sites regarding Prosper, some of which are listed below:
1. Lending Statshttp://www.lendingstats.com/ Comprehensive Stats on Prosper. Pie chart of current, late, and delinquent loans, Top lenders by estimated ROI. Active listings. Membership growth. Total loans funded. Repeat borrowers. Loans list. Delinquent loans. Lender breakdown. Biggest lenders. Top 10 bidders. Groups list. Top 10 Groups by ROI. Groups by funding. Lender bids.
IMPORTANT LINKS AT LENDINGSTATS:
Look at Another Lender's Portfolio and Success Rates:
http://www.lendingstats.com/prosperInvestors Lender list. You can put in usernames from the top 10 lenders (find on main page of http://www.lendingstats.com/ or any other lender you come across whether directly on Prosper or through one of the stats sites, and find out what their success rate is with their portfolio.
Example: This is my portfolio info:
http://www.lendingstats.com/memberProfile?lenderId=dancia2007
Follow in the Footsteps of the Wise Lenders: Ranking of Prosper listings based on the estimated ROI of the lenders who have bid so far on the listing. The assumption is that lenders who invested well in the past will continue to invest wisely. It's a quick tool to identify listings of interest. http://www.lendingstats.com/listingPicker
2. Wise Clerk:http://www.wiseclerk.com/ Comprehensive Stats on Prosper. How to borrow on Prosper. How to lend and profit with Prosper loans. Listings by state, credit grade - rate or amount, or by the group affiliation. Listings with most endorsements or highest bids. Information pertaining to Prosper groups - including current and paid loans by group and late loans by group. Lists of late loans. Loan aging status. Loans paid back early. Lender portfolio map. Lenders sorted by money invested. Number of active borrowers.
3. Proprosper:http://www.proprosper.com/ Professional tools for Prosper lenders. Track lenders or listings - get an email notification about lenders you are tracking. Data browsing. Search for borrowers who are homeowners. Daily loan status tracking. Personalized Internal Rate of Return (IRR) tracking. Track groups. Filter listings to show only loans above the weighted average for similar loans. Data exports into Excel. Loan rate analyzer. Late loan analyzer. Lenders with loans. Any other reasonable custom view.
4. Ericscc: http://www.ericscc.com/ Comprehensive Stats on Prosper. Bidding activity. Best day to close a loan if you are a borrower. Download your portfolio as an Excel file. Improved ROI estimate. Most endorsed active listings. New repeat borrowers report. Total loaned. Top bidders. Lates by loan age. Group ratings. Option of notification when a forum post is made about a loan you've invested in. Set up a watch list: http://www.ericscc.com/index.php?page=myaccount_watchlist. The data is not always synchronized at the time of this writing but having a clickable list of what one is interested in really helps.
Also available on Ericscc:
Top 10 Lenders by Amount Invested (graph)
*Updated*All Lenders by Amount Invested (table)
All Lenders by Estimated ROI(table)
Diversified Lenders By ROI (table)
Top 10 Bidders Last Month
Top 10 Bidders Overall
Lender Brackets by Amount Invested
Lender Coded Listings
Prosper Member Growth
Total Amount Loaned By Week
New - Interest Rate History
New - Prosper Bidding Activity
Listings forum: lenders and borrowers can discuss with each other:
http://www.ericscc.com/index.php?page=listings_forum
Group stats:
Borrower APR Comparison By Group
Best Listing Funding Rates by Group
Best Borrower Funding Rates by Group
Groups By Total $ Loaned
http://www.ericscc.com/index.php?page=groupstats
Conclusion:
This is as much as I know right now, and hope it helps you invest more wisely than you would have without this information.
Remember there are a good share of loan listings that do not deserve to be funded, or that get funded and should not have. In general, though, people really like the concept of paying real people and not large corporations, and their gratefulness shows up in their willingness to follow through as far as it is possible. Your job, should you decide to invest some money with Prosper.com is to identify the jewels with your financial savvy and intelligence as well as gut feelings. They are there.
eric seiger
The Morning Line: There's <b>News</b> Beyond Zenyatta - NYTimes.com
Friday's horse racing roundup, including a look at the day's Breeders' Cup races.
Fox <b>News</b> Ratings on Election Night Beat Networks - NYTimes.com
The Fox News Channel's midterm election coverage attracted more viewers than any of the broadcast networks' coverage, according to the Nielsen Company.
Even FOX <b>News</b> Not Hiring Christine O'Donnell
FOX News not doing something is always a banner news item. They also didn't burn down the Empire State building today or march naked through Times Square. Don't miss writing news copy about that! ...
eric seiger
The Morning Line: There's <b>News</b> Beyond Zenyatta - NYTimes.com
Friday's horse racing roundup, including a look at the day's Breeders' Cup races.
Fox <b>News</b> Ratings on Election Night Beat Networks - NYTimes.com
The Fox News Channel's midterm election coverage attracted more viewers than any of the broadcast networks' coverage, according to the Nielsen Company.
Even FOX <b>News</b> Not Hiring Christine O'Donnell
FOX News not doing something is always a banner news item. They also didn't burn down the Empire State building today or march naked through Times Square. Don't miss writing news copy about that! ...
eric seiger
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