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While developing my investment strategy for Lending Club and Prosper for 2014, I also wanted to create some simple filters for investing as well. My thought for doing this was inspired by Peter Renton first putting out some simple filters back in 2012. He has since provided updates to these filters along with his traditional and more specific criteria.

I’ve designed my simple filters as a strategy that allows investors to invest directly through the interface of each company with a higher chance of success in finding notes. Many criteria available at Nickel Steamroller and other statistics sites are not easily translated to the platforms without the API interface or downloading the entire available loan listing and manually filtering. By skipping those steps, investors can get their money to work in a straightforward fashion. Naturally, this won’t prevent some of the onslaught and frenzy that is now normal around the note release times, but with a simple investment strategy, you give yourself a great chance.

Simple Lending Club Strategy

This filter will look fairly similar to some readers, as it is very close to what Peter over at Lend Academy has recently posted. The difference between the two comes from the addition of the employment length filter and higher income requirements. You can check out the returns from this filter at Nickel Steamroller: Simple Lending Club Filter – Nickel Steamroller

Loan Grade: C, D, E, F, and G

Inquiries last six months: Zero

Purpose: Credit Card Refinancing and Debt Consolidation only

Income: Greater than or equal to $60,000 per year or $5,000 per month

Employment Length: Greater than or equal to five years

Simple Prosper Marketplace Strategy

Of the two simple filters, this one is my favorite by far. Capturing almost 10% of all issued notes from Prosper, it significantly upgrades the potential returns and allows investors to get their money to work. You can check out the returns from this filter at Nickel Steamroller: Simple Prosper Filter – Nickel Steamroller

Loan Grade: C, D, E, and HR

Inquiries last six months: Zero

Income: Greater than $50,000

Term: 36-Month Only

Simple Peer to Peer Lending Strategy Summary

Both of the filters above will provide investors a sizeable opportunity for investing their cash, while limiting their losses overall. Below is a table summarizing both Lending Club and Prosper’s overall returns in comparison to the returns for the filters above. Of course, returns are dynamic, so these snapshots are from today, February 28, 2014.

All Loans All Loans ROI Filtered Loans Filtered ROI ▲ ROI Lending Club 259,445 8.76% 14,608 12.94% 4.18% Prosper 82,392 9.61% 6,431 15.22% 5.61%

Have you had any trouble staying invested in your peer to peer lending accounts? What steps have you taken to eliminate any uninvested cash?

If you’re interested in investing in either Lending Club or Prosper and have questions, feel free to let me know in the comments below or via my contact page. To check out my peer to peer lending investments, check out my Lending Club and Prosper pages.

Flickr: compujeramey