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anyone involved in microlending?

I thought about it, and I reached the conclusion that the amount of money that I'd be willing to risk with microlending wouldn't be enough to make any meaningful impact on my overall return on investment, so it's not worth the effort. The idea of lending money to average Joes is appealing, but then you realize that average Joes have been abandoning their mortgages en masse because their houses have decreased in value. People don't feel any moral obligation to repay their debts anymore, they'll only do what's in their best interest financially. Sorry average Joes, you blew it.
 
It's worth some clarification:

Prosper isn't microlending, per se, though people may request smaller amounts.

Kiva lending is microlending, but the borrowers are small business owners abroad (developing nations) who are usually left out of the standard financing processes.
 
Originally posted by: TheTony
It's worth some clarification:

Prosper isn't microlending, per se, though people may request smaller amounts.

Kiva lending is microlending, but the borrowers are small business owners abroad (developing nations) who are usually left out of the standard financing processes.
Click to expand...

Good points. Also, Kiva microlending is not for profit. You don't earn interest on loans.
 
Originally posted by: mugs
I thought about it, and I reached the conclusion that the amount of money that I'd be willing to risk with microlending wouldn't be enough to make any meaningful impact on my overall return on investment, so it's not worth the effort. The idea of lending money to average Joes is appealing, but then you realize that average Joes have been abandoning their mortgages en masse because their houses have decreased in value. People don't feel any moral obligation to repay their debts anymore, they'll only do what's in their best interest financially. Sorry average Joes, you blew it.
Click to expand...

im not aiming to get meaningful return, because itll be a small sum, and either way im not making money with checking/savings nor stock account.

rather than have my money sit stale itll be feel-good to lend to people. only to hot girls, though.

are there nicely compilated stats for kiva/prosper?
 
Originally posted by: LS21
Originally posted by: mugs
I thought about it, and I reached the conclusion that the amount of money that I'd be willing to risk with microlending wouldn't be enough to make any meaningful impact on my overall return on investment, so it's not worth the effort. The idea of lending money to average Joes is appealing, but then you realize that average Joes have been abandoning their mortgages en masse because their houses have decreased in value. People don't feel any moral obligation to repay their debts anymore, they'll only do what's in their best interest financially. Sorry average Joes, you blew it.
Click to expand...

im not aiming to get meaningful return, because itll be a small sum, and either way im not making money with checking/savings nor stock account.

rather than have my money sit stale itll be feel-good to lend to people. only to hot girls, though.

are there nicely compilated stats for kiva/prosper?
Click to expand...

There are plenty of good looking women that would be willing for you to "loan" them a nice steak and lobster dinner, and then go home and never call you again.
 
Originally posted by: OCguy
Originally posted by: LS21
lendingstats.com

some dudes are puttin out 1mil into prosper...with a 50% default rate. gee
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Prosper has been down for a while...
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Wow, just looked into it. Didn't know SEC was looking into it for months now.
 
I lost my $200 bucks I put into Prosper. People are bums.

Kiva is a bit nicer, I have not lost any money when lending to people in Southeast China, but lost some to people in Eastern European countries. It just makes you feel good instead of earning money.
 
People are always saying, if you loan money to a friend, dont expect to see it back.

So why would I expect it anything more when loaning to a complete stranger?
 
Kiva ftw. I don't ever really intend to pull my money back out of it, so I view it more as a gift than a loan, but it's nice to put a finite amount of capital in and watch others succeed where they otherwise would not, particularly because their success sometimes means the difference between feeding their kids and not feeding their kids.
 
Originally posted by: LS21
lendingstats.com

some dudes are puttin out 1mil into prosper...with a 50% default rate. gee
Click to expand...

That lendingstats.com site doesn't seem to have up to date data. Right now, three of my seven active Prosper loans are at least two months late, but one of them started paying again recently but hasn't caught up yet. According to the lendingstats site, only two of my loans are only one month late... I wish that was the case.

Honestly, I feel lucky that half of my loans are still current, considering that the site was shut down by the feds for over six months. Hell.. most states STILL haven't given them approval to operate in their states.
 
So, I'd be curious to learn more about prosper. Is it a genuine credit entity? IE: If someone defaults, does it actually go on their credit report, etc?
 
Originally posted by: Eli
So, I'd be curious to learn more about prosper. Is it a genuine credit entity? IE: If someone defaults, does it actually go on their credit report, etc?
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They do credit checks on borrowers, and send collection agencies against deadbeats who do not pay. I'm pretty sure that if you don't pay at all, they'll put a charge-off on their credit report.

Prosper's scoring system seems overly optimistic, though... two of my non-paying lenders supposedly had an "A" credit grade.
 
I have $200 on Kiva right now. It's lent out in Tanzania and Uganda. Everyone's up to date on payments, but I'm only two months in.
 
Originally posted by: ultimatebob
Originally posted by: Eli
So, I'd be curious to learn more about prosper. Is it a genuine credit entity? IE: If someone defaults, does it actually go on their credit report, etc?
Click to expand...

They do credit checks on borrowers, and send collection agencies against deadbeats who do not pay. I'm pretty sure that if you don't pay at all, they'll put a charge-off on their credit report.

Prosper's scoring system seems overly optimistic, though... two of my non-paying lenders supposedly had an "A" credit grade.
Click to expand...

Can just any old agency file a credit report? I wasn't really aware of that.

In that case, I think it's incredibly retarded that payments to utilities, phone companies, rent, etc don't count in your favor, but they could ding you if you don't pay them.
 
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