Archive

After my last post soliciting feedback, comments and ideas last week, we received over 40 comments via emails and Facebook posts. We value your input immensely. Please keep it coming and expect more new features to be released in the next few weeks based on your feedback and the existing product roadmap.

In the meantime, we would like to offer an update on the new features released this week:

How we set interest rates. Many of you requested this information to be disclosed and we agree it was long overdue. It is now available at https://secure.lendingclub.com/info/how-we-set-interest-rates.action. Renaud will write a separate post on this later this week.

Relist a loan request. If a loan request is not fully fulfilled at the expiration of a 14-day period after the listing date, borrowers now have the ability to relist their loan. In that case, the funding is reset to 0 and lenders’ committed funds become available again.

The loan ID remains identical so that lenders can track relisted loans and commit funds again for another 14-day period if they wish to do so. When relisting a loan request, borrowers can modify title and update of expand the loan description.

Time left before closing. Loan listings and search results now include an extra column showing time left before closing or expiration. Many lenders have asked for this information to be made available in the listings and search results to gain the ability to quickly compare loans and include the “time” factor in their decision to fund a loan.

Note: LendingMatch also factors in time (and amount) left to close.

Issued loans. Now you can browse completed loans that have been issued to the borrowers. We will keep on giving updates on origination amounts, and will make more information, data and statistics available on https://secure.lendingclub.com in the next few weeks. Displaying issued loans is a first step in this direction.

Thank you again for your feedback. Feel free to comment on new, existing, and missing features by posting comments on this blog, on the Facebook application page or by email at feedback@lendingclub.com. Happy borrowing and lending!

Better rates. Together.

Rob from Lending Club

We wanted to remind our blog readers that after you sign-up for lendingclub.com via Facebook, you can use our convenient “Sign In” button on the top right of this page to log directly onto your Lending Club account.

We are always looking for ways to simplify, so please let us know if you have any other suggestions.

Credit card debt is a double-negative. It makes you pay more for something you bought because of interest. It also seriously hurts your credit score.

I’ve tried talking about credit to my friends at school. College students seem not to care about credit because it doesn’t affect them right now. A few years down the line, when they try to buy a house, that’s when they will realize the benefits. Let’s look at why you should establish good credit.

Because you want to have somewhere to live

Landlords are going to trust a credit report more than they will trust your promises to pay on time. Credit problems from the past can definitely influence whether or not a landlord will give you a place to stay.

Think about it: if you had to rent out a house and your choice for the tenant was between someone with a perfect history of paying bills on time and someone who couldn’t make payments on the ridiculous number of 5-5-5 Domino’s pizza deals he bought in college, who would you pick?

Because you want a job

Employers sometimes request credit reports during the hiring process. Credit reports help employers judge the trustworthiness of their potential hires. If you can’t pay your bills on time, can you finish your projects on time? Even if your habits since college have changed, your credit score doesn’t move at the same speed as your maturity.

Because you need a car (to impress the ladies)

Your credit score can determine the interest rate on your car loan. If you have a bad credit score, you will get a bad interest rate on your loan. In addition to your credit card debt, your car payments will be higher.

Disregarding your credit just because you are young is a mistake. Credit problems at any age will hound you for a long time. It is much easier to maintain good credit than to improve on bad credit. How much harder is it to increase your GPA than maintain it? In the same way, protect your credit.

If you’re having trouble making ends meet, or your savings aren't growing as quickly as you expect, the question of "Where did my money go?" may constantly be on your mind. Learning the answer may seem like an overwhelming task, but it's one worth doing.

There are many computer programs available to help you track your monthly expenses. What matters is that you track expenses, not how you track them. You can track things in whatever way makes sense for you: using a program designed for that purpose, using a basic spreadsheet, or even good ol' pen and paper.

There are two main reasons to track your expenses:

1) Discover where you are spending more money than expected

Basic tracking will help you to cut back in areas that you didn't even know were causing problems. The classic example is how much your daily coffee adds up to over the year. This isn't done so that you’ll say "I can save x-dollars a year if I give up coffee," but rather, "Are those daily coffees worth x-dollars a year to me?" You may decide that your daily coffee is worth it to you. You can't make that decision unless you have accurate information.

2) Set reasonable savings goals

You can't expect to save $1,000 a month (or whatever your goal is) if you only have $100 left after all of your expenses. Without accurately tracking your expenses, you’ll likely be frustrated if you cut back on spending and don't see the results you expect -- even if your goals were not reasonable.

You will gain control of your finances after you decide which expenses are necessary and which can be cut back. Set reasonable saving goals for yourself. Limiting certain expense categories can help you to stay on track with your plan. This entire process will only work if you have the discipline to stick to your plan. Fortunately, the pain of passing up an "urge to splurge" gets easier the more you do it.

Time is your greatest ally. Once you have decided to get onto the Investment Ship, you are automatically given an ally. Time is an asset. Depending how you use this asset, it can work for you or against you. By postponing your investing, you are not utilizing the time asset.

Time and amount of money required are inversely proportional. What this means is the more time you have, the less money you need to invest. The longer you wait to get started with your investments, the more money you will have to put in to get the same type of return as somebody that started earlier.

Here's an example: Let's take three people, Mark, Stacy and Jose. Jose was smart and at age 20 he started investing $100 per month. Stacy started investing $100 per month at age 25. Mark, always waiting for the "right time", started investing at the age of 35. Assuming 9% return on their investments, and their desire to retire at age 65, how much will have each have if they continue investing $100/month until they retire? (click on graphic to see full size)

Waiting five years to start investing cost Stacy $272,355.82, and waiting ten years to start investing cost Mark a total of $446,309.40. That's almost half a million dollars (ignoring taxes).
You might be looking for the right time to start investing. The only "right time" to start investing is today. Putting off investing for any reason is going to cost you much more in the long run than getting the timing correct.

Make it automatic -- one of the secrets that the government uses to make sure that everybody pays their income taxes is that they have it automatically taken out of your paycheck before you even see it. Once the company sets up payroll taxes for you, there is no more thought that goes into paying the government.

You should follow this system. Make investing automatic. There are many ways of investing and saving automatically. You can have it taken out of your paycheck and automatically invested. You can have a certain amount taken out of a bank account monthly. In the future I will cover this in more detail.

Meanwhile, whatever you do, start your investment plan today.