Investing

Lending Loop - peer to peer lending - do due diligence

  • Last Updated:
  • Nov 15th, 2017 3:41 am
Deal Addict
Oct 1, 2004
4141 posts
269 upvotes
Toronto
treva84 wrote:
Mar 23rd, 2017 9:15 pm
For those curious, LendingLoop is posting statistics about their loans on their web page -

https://www.lendingloop.ca/statistics
does it show how many businesses have gone under so far on their website?

I'm assuming there was mentioning of one few pages back?
Deal Addict
Nov 9, 2013
1901 posts
664 upvotes
Edmonton, AB
greg123 wrote:
Mar 24th, 2017 11:01 am
does it show how many businesses have gone under so far on their website?

I'm assuming there was mentioning of one few pages back?
It mentions it on the graph "loan performance by risk band". I think there has only been 1 business that has gone under and defaulted on their loan. LL was able to recover ~95% of the outstanding amount of the loan.
Member
Nov 6, 2013
492 posts
210 upvotes
Winnipeg
Pretty interesting stats. I look forward to their plans to expand the platform and move into different areas in the future.

So far I have been happy with my experience with LendingLoop and might move more funds in the future.

They did an AMA on Reddit recently which was insightful: https://www.reddit.com/r/PersonalFinanc ... _and_only/
Member
Apr 9, 2012
435 posts
119 upvotes
Markham
For those who have put money into Lending Loop.

How do you select the business you lend to usually when you see a bunch of deals?
Generally how much do you put into each deal? $100? 200?
What are some of the things you look for in the business? Type of business, Balance Sheet and Income statements? The information on there usually isn't very detailed and often the accounting is lacking.
Deal Addict
Jul 28, 2009
1311 posts
219 upvotes
atang810 wrote:
Apr 17th, 2017 2:27 pm
For those who have put money into Lending Loop.

How do you select the business you lend to usually when you see a bunch of deals?
Generally how much do you put into each deal? $100? 200?
What are some of the things you look for in the business? Type of business, Balance Sheet and Income statements? The information on there usually isn't very detailed and often the accounting is lacking.
1. Is it profitable?
2. Language of the poster, their competency to answer questions.
3. Google maps and other reviews of the business if applicable. Quick google background searches.
4. Do they have adequate capital/assets to run the business, cover losses or payout debtors if they go under.

I usually put $25-50 only per business, spreading my risk out across alot of notes. I have put $100-400 in some though if I really like them.
Member
Apr 9, 2012
435 posts
119 upvotes
Markham
PunPryde wrote:
Apr 17th, 2017 2:33 pm
1. Is it profitable?
2. Language of the poster, their competency to answer questions.
3. Google maps and other reviews of the business if applicable. Quick google background searches.
4. Do they have adequate capital/assets to run the business, cover losses or payout debtors if they go under.

I usually put $25-50 only per business, spreading my risk out across alot of notes. I have put $100-400 in some though if I really like them.
Thanks. That's a similar approach I have taken as well.

Like you, I also put around $50 to $100 per deal. But when I think about that in the context of an asset class and my overall investment portfolio, it's just too small. I am asking because I don't see many lenders on there throwing in $1000+ per deal. It's very bizarre because when you buy a stock/equity, you will never think of buying a company for less than $2000-3000 at a time (just not worth it if you factor in trading cost).
Newbie
User avatar
Feb 28, 2012
66 posts
8 upvotes
Vaughan
Any updates for Lending Loopers?

I'm curious after doing some math and spreading some risk, it should be viable to make 8-12% per year. That would seem like a very attractive investment. Aside from plucking a nice stock, this seems like one of the nicer returns available for Canadians. Anything I'm missing besides being aware of the risks?
Deal Addict
Nov 9, 2013
1901 posts
664 upvotes
Edmonton, AB
jb10071 wrote:
Apr 25th, 2017 3:25 pm
Any updates for Lending Loopers?

I'm curious after doing some math and spreading some risk, it should be viable to make 8-12% per year. That would seem like a very attractive investment. Aside from plucking a nice stock, this seems like one of the nicer returns available for Canadians. Anything I'm missing besides being aware of the risks?
It's very tax inefficient.
Newbie
User avatar
Feb 28, 2012
66 posts
8 upvotes
Vaughan
treva84 wrote:
Apr 25th, 2017 3:25 pm
It's very tax inefficient.
Does Lending Loop require the investment to come from an individual or can it come from an entity? If it's only personal I guess it would be incredibly inefficient.
Member
Apr 22, 2014
413 posts
197 upvotes
Edmonton, AB
treva84 wrote:
Apr 25th, 2017 3:25 pm
It's very tax inefficient.
During an AMA they held on Reddit, I asked them about RRSP/TFSA accounts and they said it's something they are exploring. Not saying it would happen anytime soon, but it could be a game changer.
Deal Addict
Nov 9, 2013
1901 posts
664 upvotes
Edmonton, AB
jb10071 wrote:
Apr 25th, 2017 3:31 pm
Does Lending Loop require the investment to come from an individual or can it come from an entity? If it's only personal I guess it would be incredibly inefficient.
It has to be from an individual, no corporate investing allowed at present.
Member
Apr 9, 2012
435 posts
119 upvotes
Markham
I have invested in a lot of the deals since joining a month ago. They do have a fair amount of deals however I feel the information is really lacking. Very simplified financials.

One of the thing I dislike about this is I will invest $100-300 for each deal. With that amount of money, it's not worth doing the due diligence. I looked through the lenders list and only 1-2 lenders will fund $1000, everyone else is funding $25-$300, so I doubt people are spending the time needed for real due diligence.
Member
Apr 22, 2014
413 posts
197 upvotes
Edmonton, AB
atang810 wrote:
Apr 25th, 2017 6:16 pm
I have invested in a lot of the deals since joining a month ago. They do have a fair amount of deals however I feel the information is really lacking. Very simplified financials.

One of the thing I dislike about this is I will invest $100-300 for each deal. With that amount of money, it's not worth doing the due diligence. I looked through the lenders list and only 1-2 lenders will fund $1000, everyone else is funding $25-$300, so I doubt people are spending the time needed for real due diligence.
One week ago you said you invest $50 to $100 and now you say $100 to $300. Anyway, $300 to you could be $25 to someone else or $2,000 to another. Everyone has a different risk appetite, different experiences that shape their opinions, and do a different amount of due diligence. I don't know why you are painting everyone with your brush.
Member
Apr 22, 2014
413 posts
197 upvotes
Edmonton, AB
jb10071 wrote:
Apr 25th, 2017 3:25 pm
Any updates for Lending Loopers?

I'm curious after doing some math and spreading some risk, it should be viable to make 8-12% per year. That would seem like a very attractive investment. Aside from plucking a nice stock, this seems like one of the nicer returns available for Canadians. Anything I'm missing besides being aware of the risks?
I opened an account back in October when they started up again. I am currently invested in 52 loans. My average rate of return is 13.17% after Lending Loop's fees. Of the amount I have invested, my biggest investment is just under 4% of my portfolio while my lowest investment is 1.3%. I have not experienced any defaults yet. Two loans have been fully repaid early. Only one loan has been problematic with 2 late payments.

It's still early but so far, so good.

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