At the end of September, I had a total of $3,059.41 in outstanding notes, another $450 (9 notes worth) committed to loans that were in the process of being funded, and a small amount of accumulated cash on hand.
During September, I received my first payments from borrowers that I backed with my initial investments. As that money accrues, I’ll be reinvesting it into $50 notes, just as I do when investing any new money that I deposit.
Looking inside my portfolio, I had 62 active notes, which included mostly Grade C notes (47), with a handful of Grade D (14) and E (1) notes. This reflects my overall strategy, which is to target somewhat riskier notes to achieve higher returns.
Related: Check out my Lending Club review to see my loan filters…
The average interest rate of these notes was 15.87%. As I’ve noted in the past, however, this doesn’t account for the likely occurrence of defaults, so the effective rate will undoubtedly end up lower.
Now that I’m receiving payments, Lending Club is also estimating my Net Annualized Return (NAR), which currently stands at 16.28%. Not too shabby.
Of course, this number is once again somewhat inflated by the fact that an unknown (hopefully small) fraction of my notes will almost certainly default in the long run. As always, my goal is to achieve returns in the 10-12% range.
Going forward, I’ll be continuing to invest my monthly allotment as well as any principal and interest payments that I receive. And, of course, I’ll be documenting everything for you guys as it happens.
If you’re interested in playing along, you can get started here.