Features

LendingClub is the United State's largest marketplace lending platform. Since it was launched in 2007, investors have invested over $26 billion. LendingClub offers attractive returns (5% to 7%) and an easy way to diversify your portfolio. 

How Does LendingClub Work?

Borrowers apply for loans from LendingClub. LendingClub selects the applications that are most likely to be repaid using a proprietary risk assessment model. Investors then buy notes, which represent fractions of these loans. LendingClub investors can quickly diversify their investment by creating a portfolio comprised of notes for hundreds or even thousands of loans.

As borrowers repay their loans, investors receive a stream of income, typically 2% to 5% of the amount invested every month. 

What is the average return on investment?

LendingClub notes have historical annual returns between 5% and 7% per year. Here's a typical scenario. Let's say you have a portfolio of loans that generates an average return of 13% per year. Even if you only invest in borrowers with good credit, some may still default. Let's say you lose 5% to defaults. That leaves you with a 7% annual return.

Interest rates vary depending on the type of loans you invest in. LendingClub assigns borrowers a grade that ranges from A to G based on their credit score and other credit relevant factors. This score will determine what interest rate they qualify for. Investing in borrowers with a lower score will increase your potential earnings, but it also increases the risk of default on your loans. 

What is the minimum investment in LendingClub?

The minimum investment in LendingClub is $1,000

What types of investment accounts are there?

LendingClub offers regular investment accounts and several types of tax-advantaged IRAs, such as traditional IRAs, Roth IRAs, and 401(k) rollovers.

How Is It Better Than Other Lenders?

LendingClub gives the average investor access to consumer credit loans, which historically has only been available to banks and large financial institutions.

It's easy to diversify your portfolio in amounts as small as $25 per loan. You could spread an investment of $2,500 over 100 loans.

LendingClub makes it easy to automate your investment on a preselected strategy.

The minimum investment amount is only $1,000.

 

  • Average ARR
    5%
  • Min Loan
    $25
  • Minimum Investment
    $2500
  • U.S. Investors
  • IRAs
  • Investor Fees
    1%
All loans made by WebBank, Member FDIC. Your actual rate depends upon credit score, loan amount, loan term, and credit usage & history. The APR ranges from 5.99% to 35.89%. For example, you could receive a loan of $6,000 with an interest rate of 7.99% and a 5.00% origination fee of $300 for an APR of 11.51%. In this example, you will receive $5,700 and will make 36 monthly payments of $187.99. The total amount repayable will be $6,767.64. Your APR will be determined based on your credit at time of application. The origination fee ranges from 1% to 6% and the average origination fee is 5.49% as of Q1 2017. There is no down payment and there is never a prepayment penalty. Closing of your loan is contingent upon your agreement of all the required agreements and disclosures on the www.lendingclub.com website. All loans via Lending Club have a minimum repayment term of 36 months or longer. ---------- i. 4.95%-7.10% average historical returns for loan grades A through C as of March 31, 2017. To be included in the historical returns ("Historical Returns") calculation, a Note must have been originated prior to September 30, 2015. Historical Returns are Lending Club's adjusted net annualized returns ("Adjusted NAR") for Notes with Grades A through C. Adjusted NAR is calculated using the formula described here. Historical returns are based on actual borrower payments received each month, net of fees, actual charge offs, recoveries, and estimated future losses. To estimate future losses, we apply a charge-off rate estimate to the outstanding principal of any loans that are past-due but not charged off. The charge-off rate estimate is based on historical charge-off rates by loan status over a 9-month period. Historical performance is not a guarantee of future results. Lending Club Notes are not insured or guaranteed and investors may have negative returns. Individual portfolio results may be impacted by, among other things, the size and diversity of the portfolio, the exposure to any single Note, borrower or group of Notes or borrowers, as well as macroeconomic conditions. Notes are offered by prospectus filed with the SEC and investors should review the risks and uncertainties described in the prospectus prior to investing in the Notes. ------- ii. LendingClub retail investors have historically received 2-5% monthly cash flow, based on the 10-90th percentiles of retail investors' total monthly proceeds (scheduled principal & interest and additional payments, net of any charged off loans and fees) divided by the two-month trailing average account value that retail investors with at least $2,500 outstanding investment balances each month have experienced for the trailing twelve-month period ending March 31, 2017. Individual results may vary based on grade and term composition of an investor’s investment strategy. Historical performance is not a guarantee of future results. This information is not intended to be investment advice. LendingClub Notes are not guaranteed or insured, and investors may lose some or all of the principal invested. Notes are offered by prospectus filed with the SEC and investors should review the risks and uncertainties described in the prospectus prior to investing. Actual results may vary.
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