Hello Friends!  Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice!  As always, please remember that I am an amateur investor, so please remember to consult with your professional investment advisers prior to making any investment decisions based on information on this website.

Last month, on February 10, 2008, I discussed my Prosper.com account.  (If you do choose to sign up via these links, please know that there is a $25 incentive when you make your first loan and also a $25 fee that I receive for making that referral!)

It is difficult to read the financial news without reading about the ongoing credit crunch.  I have great concerns about person-to-person lending arrangements in the midst of this credit problem and economic slow-down.   

And yet Prosper.com CEO Chris Larsen sees opportunity in this 'credit crunch'.  As he recently related in an interview with the San Francisco Business Times:

"Prosper CEO Chris Larsen said Monday that the San Francisco company is benefiting from the credit crunch that's sending more lenders and borrowers to the person-to-person lending marketplace.

More people with good credit are coming to Prosper as home equity loans and credit cards become harder to obtain, Larsen told 350 people attending the company's Prosper Days in San Francisco.

"Banks are retrenching so aggressively," he said. Prosper lenders have also pulled back on loans made to subprime borrowers.

Larsen also anticipates more people might be willing to lend on Prosper as rates fall on other investments following the Fed's dramatic rate cuts."

However, I still am cautious about the safety of lending unsecured amounts to individuals in this set-up and would encourage all of you to exercise reasonable caution and care.  Certainly emphasizing higher quality borrowers and spreading out your loans to multiple borrowers is a reasonable approach to reduce some of the risk.   Meanwhile, I am committed to continuing to share with you my own experience on Prosper.com. 

A recent article on these type lending arrangements recently was published in the Wall Street Journal.  Pay special attention to the comments sections, especially to  ira01 who details some of his perceptions of the risks involved in lending on Prosper.  Especially useful is his link to LendingStats.com which summarizes the Prosper.com lending experience.

In fact, you can view my statistics on Prosper.com here. 

Reviewing my own Prosper.com information, I currently have 53 active loans vallued at $2,816.62.  I continue with my automatic $50 deposit into Prosper.com twice/month.  I have $15.37 in payments pending, $122.59 in current bids that are 'winning', yet still not concluded for an average interest rate of 18.62%.  I have had total loans of $2,960.69, with $248.63 in payments received.  My average interest rate on my loans is at 15.69% with a daily interest accrual of $1.20.

Right now 50 of my 53 loans are current.  I have one loan which is less than 15 days late on a payment (it is marked as having a pyament being processed); however, I have two loans which are more problematic.   One is between 15 days and 30 days late with a principal balance of $(47.87), and one which is greater than 30 days overdue and has been entered into collection.  That one has a balance of $(46.76).

My first loan was written September 20, 2007, and my latest loan was approved March 10, 2008. 

If you are interested in learning more about Prosper.com, you can click here to enroll.  Like I have noted, I do receive a $25 referral fee if you do decide to make a loan.  I have tried to emphasize the tremendous risks involved, risks that have grown as the credit crunch develops and the pressure on homeowners and others who may seek unsecured loans may increase.

Thanks so much for stopping by and visiting my blog!  If you have any comments or questions, please feel free to leave them on the blog or email me at bobsadviceforstocks@lycos.com.  If you get a chance, be sure and visit my Covestor Page where my actual Trading Portfolio is monitored and evaluated as well as my SocialPicks Page where my stock picks are followed and monitored.  If you are interested, consider dropping by my Podcast Page where you can download mp3's of me discussing some of the many stocks and issues I address in the blog!

Hoping next week brings all of us good health and financial success.  

Yours in investing!

Bob