Performance help...

[Moosie]

OK, I'm not Huge on Analizing stuff. I'm sure there are some people that can do that here might be able to break it down to my Retard Status to help answer something fo me.

Here is the Over all Performance page :

http://www.prosper.com/lend/performance.aspx

Here is the Loan Criteria I'm used page (OK, jsut one of the criterias but it's the majority of my borrowers) :

http://www.prosper.com/lend/perform...r=11/01/2005&plcgd=&plp=0&sf=10&sh=0&sn=&tg=0

So, What I want to know is what is my default rate if my average borrower is a "C" and my Average eturn on all 71 loans is 19%.

I have 6k invested. So I went down 1 letter grade to play it safer and the Over all Defaults being "4.21%" . In that clasification the over all 1month+ lates are "7.70%" so if they default plus the others equals 11.91%.

The late ones have paid back some principle and interest I'm sure but I'm gonig to calculate 11.91% default from day one. So a 88.09% or 6k is $5285.40. 19% return will be $1004.23. So thats $6,289.63 = 4.93% return ?

Am I figureing this out right ? I'm guessing it's more complicated because I will reinvest the money and such. I'm also using the Average defaults and I'm not investing the same amount with each person so if 2 people default with $100 each it hurts 2 times more then 2 people with $50 each....

Alright, it just got complicated, I'm going back to gut feels

 

[brymoore]

I'm having a hard time following your post. In what I think you're trying to accomplish above, you need to worry about the default rate, not the delinquency rate. A customer who pays late every month is considered delinquent.

 

[Moosie]

Yes, but I would guess that a DQ means they are on their way to default. I was assuming that 1+ month they are eventually gonig to default ? Probably not so in all cases... but I wanted to run a "Worse case senario".

 

[Moosie]

What would my return be with the Criteria I set forth above then ?

Average rate C, Average return 19%, YAddy YAddy.....

 

[brymoore]

You're overthinking it. Deliquency doesn't equal default.

4.21% deliquency rate with 19% return on $6k equals $1,092. This doesn't account for monthly principal repayment. You're return will be less if you cannot reinvest your money at atleast 19% monthly.

 

[Moosie]

Uhhhh now I'm even more confused ?!?! Wouldn't 4.21% DQ be $252.60 not $1,092 ?

So my loss on a 6k investment would be estimated of $252.60 defaulting. So if my return is 19% on the remainder then I'll get 19% of $5747.4 or $1092... UHHh OK, Never mind

But the return would be $5747.4+$1092=$6839.4 or $14% ROI ?

 

[brymoore]

I also get 14% total return. Do you get to charge late fees? That should help offset some of the delquency?

 

[Moosie]

I don't get to charge Late fees but I think there is a late fee associated if they are late. I'm not sure how that gets distributed.

I do get charged a 1% fee (Or it gets deducted at least) from my account. I think that is out of the rate. (SEE HIGHLIGHTED BELOW) so a 19% average I only get a 18%. So my 14% would yield me only 13%. I'm still thinking long term it will be around the 10% mark. Right now I'm still all up to date but I'm new on the loans still. No ones defaulted or late yet. Would be nice if it stayed that way, But I'm a Realist

(Almost up to a Pack of Smokes a day bud )

Payment status: 72: Current
Value of loans: + $5,975.30
Payments in transit: + $48.87

Payments received: $209.33
Principal paid: $142.29
Interest paid: $70.51
Servicing fees: -$3.46

Avg. interest rate: 19.67%
Daily interest accrual: $3.21

NOTE EDIT :

...I think Experian must use the same estimated default rate becasue if you look at the chart : http://www.lendingstats.com/lenders/MoosieID

Is says :

Estimated ROI 18.72%
Estimated ROI Range 18.72% - 18.72%
Experian ROI 14.43%
Experian ROI Range 13.17% - 15.39%

 

[Moosie]

So what do you make of the DQ's on the Stats charts ?

http://www.lendingstats.com/loansFunded

Seems the DQ's are WAY down or non existant last month? I wonder if the program is working better of the people are picking better ? Interensting Stats if nothing else.....

 

[brymoore]

They haven't had any defaults since July 2007? I find that hard to believe.

 

[Moosie]

I'm not buying that chizz wither.. jsut though I was reading the graph wrong ?!?!