Lending Club’s average returns rise to 9.60% APY
September 1st, 2009 Posted in High Yield Savings Accounts
Since BankVibe first dubbed Lending Club as a lucrative alternative to bank CDs, we have seen their average returns raise from roughly 7.0% APY to a whopping 9.60% APY!
Lending Club is the industry leader for peer to peer lending. They can provide better returns to investors by connecting qualified borrowers with people looking to invest money.
For those of you whom are unfamiliar with Lending Club, here are some crucial facts to consider…
- Since June 2007, Lending Club investors have earned an average net annualized return of over 9.0%.
- The money you invest funds loans made to creditworthy borrowers.
- Many borrowers apply, but less than one in ten are accepted. Lending Club approves only credit worthy borrowers as members.
- They make it easy to build a portfolio based on your criteria. Most lending members spread their investment across tens or hundreds of qualified borrowers.
- Their rates are based on historical trends and the current economic climate. Borrowers pay a fixed rate for the 3-year life of the loan.
- You can reinvest any interest and principal payments each month or withdraw them like an annuity. You can also put your notes up for sale on the “Note Trading Platform”
- Many of their lender members find it rewarding to help others meet their financial goals. Especially in this economic environment, Lending Club members claim to come through when big banks do not.
September 2nd, 2009 at 10:53 am
It’s a great investment but not fdic insured
September 3rd, 2009 at 12:25 am
I applied, was accepted, funded my account and began lending to sundry borrowers, only to then learn I lived in a state in which Lending Club was not authorized to do business. Interested persons should check first. Maybe someday things will be different for my neighbors and I.
FDIC insurance may be a strong, #1 incentive for most investors, but it’s not the sole criteria when judging an investment’s profitability, prospects or risk. Remember, the insurance is not the investment, they are different aspects of a transaction. An investment can be a deposit but a deposit isn’t necessarily an investment, and the FDIC insures deposits. Lending to carefully screened borrowers at market competitive rates is, from a lender’s position, an investment.
September 3rd, 2009 at 4:23 am
Lending Club and P2P lending is certainly an interesting concept, but not without risks as you are pointing out.
For those of you who want to learn more, I recently interviewed Lending Club’s CEO Renaud Laplanche to answer a bunch of questions that most people have about Lending Club – you can listen to that interview at
growthink.com/content/interview-renaud-laplanche-founder-ceo-lending-club