You may know a little bit about how banks make their money, but do you ever ask yourself what it would be like to be your own bank? Well, now you can know that there's a website called https://www.lendingclub.com and it has the same concept. Its person to person lending money instead of a bank lending money to the person. There are many differences between these two types of lending.
Four most important differences are:
- Banks charge more interest to borrowers while Lending club doesn't need to. Lending Club is person to person lending which means they can grant lower interest rates depending only on the credit score of the borrower.
- Lenders earn more money with Lending Club rather than placing their money into a savings account and making under 1% return on their money. Instead, with Lending Club, lenders could possibly earn an 8% return per year or even higher. I myself have an 11.53% return on my Lending Club account. (That means if I have $100,000 invested, I would be earning an extra $11,530 per year.) If you ask me, that's a nice chunk of change in itself.
- You can place as little as $25 in your Lending Club account to start off and you can add as much money to your account as you'd like. You're in charge of your lending and can pick whether or not you want to invest in certain notes (Loans).
- Instead of lending a person the full amount of their asking loan, you would lend the person money in increments of $25 that Lending Club refers to as "notes". You will lessen the risk of you losing your money and someone going delinquent on you if you lend money to a widespread of individuals and lend only one or two notes each.
There is a way for you to earn and invest up to an extra $75. That is, if you use my invitation link and add at least $5,000 to your Lending Club Investors account within 90 days of creating it. My Invitation / Referral link can be found at the end of this article so that you can begin your journey into Lending Club.
My Lending Club
My Lending Club Part 2
Statistics of Lending Club
Lending Club on May 1st 2016
11.53% to 12.44% from March to May
My Lending Club account has been growing slowly in the past few months and I've grown my earnings almost an entire percentage in that amount of time. I have no doubt in my mind that everyone who follows my simple steps will be able to be extremely successful and achieve maximum potential.
- Start off by putting $25 - $250 into your Lending Club account\ (Or more at your own risk.)
- Place $25 into each note of your choice in the A, B, and C class. Make sure to review the notes and ensure their information seems accurate before lending money to someone. (Buy D, E, F & G notes at your own risk.) Buy notes on different days, with at least 3 days in between so you're not checking your account and find that you have not gotten paid. (Payments are not posted to your account on the due date. It will say "Pending" when payments are made and you may have to wait a few days to see it reflect on your account.
- Wait and check your account to see if payments were made and to track your monthly, weekly, or daily earnings. Good Luck!
Would you rather put your unused money in a savings account and earn 0.25% or earn more if it meant managing your money better?
Which would you rather put your unused money at?
Loans for Borrowers
Here's a complete list of loans borrowers are able to apply for.
- Credit Card Refinancing
- Debt Consolidation
- Home Improvement
- Major Purchase
- Home Buying
- Car Financing
- Green Loan
- Moving and Relocation
- Medical Expenses
Borrowers are able to take out personal loans of up to $40,000 and apply online in a few minutes. Once borrowers get funded, they will be able to make fixed monthly payments.
Borrowers are able to take out business loans of up to $300,000 with rates starting as low as 5.9%.
See Picture below for a visual on loan options and more information as mentioned in this section of the article.
Borrowers Loan Options
Founder and CEO of Lending Club
The founder and CEO of Lending Club is Renaud Laplanche who was born and raised in France in 1970 and now resides in San Francisco California where he runs Lending Club.
My Experience With Lending Club
My personal experience with Lending Club is quite new, though I feel like Lending Club has the ability to make myself and anyone else who really wants to be succeed become successful. These are a few things that I have been able to do with Lending Club so far in the short amount of time I have been with them and I do believe I am making a difference and change to society in some way or another by being apart of this great business!
- Gain a 12 percent interest rate on money which I am not using.
- I got to help people borrow money in order for them to positively impact their own lives and the lives of their family.
- My extra money is making an impact in the business and growing with the company
Though these may be simple things, I believe I can do so much more in the Months and Years to come!
My Experience with Investments Overall
I've had my fair share of investment experience, however; there are many aspects that I have yet to discover. One of my sayings are: "If you're making a decent amount of money from an investment and it's not such a hassle, keep it. If not, get rid of it and try something else."
Below are a list of investments that I have done and beside them are the average yearly percentage earned on that investment
- Lending Club 10%+
- Certificate of Deposit at Navy Federal Credit Union 3%
- Savings Account 0.75%
- Retirement Fund 1.5%
When not to invest
If you do not have money to spend, then I would suggest not to invest anything into Lending Club or any other investment because it may defeat the purpose of investing. Ensure that you have enough money to invest to where you won't need to worry about bills being unpaid at the end of the month because of your investment.
Other Reliable Investments
Other reliable investments are as follows:
- Roth IRA's - Retirement Account
- Traditional IRA's - Retirement Account
- Savings Account
- CD's - Certificate of Deposits
The downside to the Roth and Traditional Retirement Accounts is that you usually have to be at least 59 and a half years old to be able to withdraw funds from the account.
The downside to a savings account is that you're able to take money out of it and the percentage rates are a lot lower. You won't ever have a steady payment unless you don't take money out of the savings account.
The downside with a Certificate of Deposit is that you must keep your money inside these accounts for a certain amount of time. Interest rates do go up higher the longer you want to keep your money in these accounts for.
Buying and selling notes
You can buy and sell notes using Lending Club. There is a downside and an upside to this.
The upside is that you can invest less money and get your money back sooner rather than later. Here is why: The note being sold may only have $3.00 left to pay on it.
The downside is that you won't get as much money in profit for this investment. Here is why: If it only has $3.00 left to pay on it, you may only make a $0.04 profit off of it.
Buying and Selling Notes
Yes, you can buy and sell notes. The way to do this is explained on the Lending Club website. When you buy an existing note from someone, the loan may only have a few months left on payments. You will of course receive less money in interest however you would be spending less money in your investment. The reason why is because the rest of the note may only be $3.00 left to pay with only a $0.03 profit if bought. This could be good if you want less risk involved and your money back fast.
© 2016 Jesse