Note Category

Taxes

Lending Club will provide you with a year-end statement which summarizes your account activity, including interest earned and Notes with corresponding loans that have reached charge-off status. You should consult your accountant or other tax advisor regarding the proper tax treatment of all your account activity, including the ability, if any, to claim deductions related to Notes where corresponding loans have reached charge-off status.

All tax documents for the 2020 tax year will be available no later than January 31, 2021.

A Consolidated 1099 Package for 2020 will be posted in your LendingClub account’s “ Tax Statements” section and will not be mailed to you, unless you have “opted-out” of electronic delivery of tax documents. You can “opt-out” of electronic delivery of tax documents by emailing tax@lendingclub.com. If you have “opted-out” of electronic delivery of tax documents, LendingClub will mail a paper copy of the Consolidated 1099 Package to you. It is your responsibility to check your account and review all information provided before filing your tax return.

This package will include all required LendingClub tax forms and if applicable, for your reference, Form 1099-B for activity related to your LendingClub notes from your linked FOLIOfn Investments, Inc* (“Folio Investing”) account will be included at the end of the consolidated 1099 package.
LendingClub will also provide a downloadable 2020 Tax Guide with information about the data reported in the Consolidated 1099 Package.

LendingClub will alert you via email when the tax documents have been posted in your account. To learn more about what documents LendingClub issues, see “Annual statements and tax documents in your LendingClub account” 
 
LendingClub does not provide tax, financial, or legal advice and this information is not intended to be tax, financial, or legal advice. LendingClub recommends that you consult your financial or tax advisor if you have any questions.

 
 
*Folio Investments, Inc. (“Folio Investing”) is a registered broker-dealer and member of FINRA and SIPC and operates the Note Trading Platform.  Folio Investing is based in McLean, VA and is not affiliated with LendingClub.  Folio Investing has no role in the original issuance of the Notes and is not responsible for and does not approve, endorse, review, recommend or guarantee the Notes or the accuracy, reliability, or completeness of any data or information about the Notes. More information about Folio Investing is available at www.folioinvesting.com.

If you have questions about what data is being reported on the year-end statement or IRS Forms 1099, please review Lending Club’s 2020 Tax Guide. If you have additional questions about these forms, please email tax@lendingclub.com.

All other tax questions should be directed to your financial or tax advisor. Lending Club does not provide tax, financial, or legal advice and this information is not intended to be tax, financial, or legal advice.

Form 1099-OID from Lending Club shows net interest payments, which include interest income, late fee income and recoveries of unpaid interest income from previously charged-off loans, less any fee expenses.

See the 2020 tax guide for more information. 

For more information on what information is in a 1099-MISC from Lending Club, please review the 2020 tax guide.

Form 1099-B from Lending Club shows any recoveries and proceeds from previously charged off loans or Notes that were transferred out of your account. 
 
Form 1099-B from Folio Investing* shows the proceeds and gains or losses from Notes sold on the Folio Investing Note Trading Platform.

See the 2020 Tax Guide for more information. 
 
*Folio Investments, Inc. (“Folio Investing”) is a registered broker-dealer and member of FINRA and SIPC and operates the Note Trading Platform.  Folio Investing is based in McLean, VA and is not affiliated with Lending Club.  Folio Investing has no role in the original issuance of the Notes and is not responsible for and does not approve, endorse, review, recommend or guarantee the Notes or the accuracy, reliability, or completeness of any data or information about the Notes. More information about Folio Investing is available at www.folioinvesting.com.

Generally, a short term gain or loss applies to Notes that have been held for one year or less, while a long-term gain or loss applies to Notes that have been held for more than one year. Depending on your particular circumstances, there may be tax implications to the treatment of a gain or loss as short term or long term.

Neither Folio Investing nor Lending Club provides tax advice and recommends that you consult your financial or tax advisor if you have any questions or need additional information.

Interest and other payments received in your Lending Club account are generally taxable.

Lending Club does not provide tax, financial, or legal advice and this information is not intended to be tax, financial, or legal advice. Lending Club recommends that you consult your financial or tax advisor if you have any questions.

Monitoring Your Trades

You may view your trading activity for the current statement cycle on the My Account page of the Folio Investing Note Trading Platform.  Monthly trading statements are available at the bottom of that page.
                                                      
The impact of trades on the cash balance in your Lending Club account is reflected in your Lending Club monthly statement and Lending Club Account Activity report.

You will receive an email notification from Folio Investing once a trade has settled.

Settled trades will also appear on the “My Account” page of the Folio Investing Note Trading Platform under “Sold this month” or “Purchased this month” until the monthly statement is available.

Lending Club will provide a Consolidated 1099 Package for the 2015 tax year that includes all applicable Lending Club and Folio Investing* Note Trading Platform 1099 tax information in a single place. The Consolidated 1099 Package will include information that Lending Club and Folio Investing* are required to provide to you and to the IRS. Lending Club and Folio Investing do not provide tax, financial, or legal advice and this information is not intended to be tax, financial, or legal advice. You should consult your financial or tax advisor if you have any questions.

Depending on your financial situation and the activity in your account, the Consolidated 1099 Package will include some or all of the following forms:

The IRS will match the amounts reported in the forms listed above to the amounts reported in your tax return. 

Lending Club will provide a Consolidated 1099 Package for individuals, partnerships, S corporations, and trusts (for trusts established using an individual’s social security number or trusts that have an EIN) that hold taxable accounts. Lending Club is not required to and will not provide Forms 1099 for C corporations, tax-exempt organizations, tax-deferred accounts, or other entities not listed above. 

All tax documents for the 2015 tax year will be available no later than January 31st. A Consolidated 1099 Package for 2015 will be posted in your Lending Club account’s “Statements” section and will not be mailed. Lending Club will alert you via email when the tax documents have been posted in your account. It is your responsibility to check your account, review all information provided and consult with an accountant or tax advisor before filing your tax return.

* Folio Investments, Inc. (“Folio Investing”) is a registered broker-dealer and member of FINRA and SIPC and operates the Note Trading Platform.  Folio Investing is based in McLean, VA and is not affiliated with Lending Club.  Folio Investing has no role in the original issuance of the Notes and is not responsible for and does not approve, endorse, review, recommend or guarantee the Notes or the accuracy, reliability, or completeness of any data or information about the Notes. More information about Folio Investing is available at www.folioinvesting.com.

A trade typically settles on the business day after the buyer submits an order to buy the Note.

Interest and other payments received in your Lending Club account are generally taxable.

Lending Club does not provide tax, financial, or legal advice and this information is not intended to be tax, financial, or legal advice. Lending Club recommends that you consult your financial or tax advisor if you have any questions.

No, neither the buyer nor the seller may cancel a trade that is pending settlement. Once the settlement process begins, the seller’s offer to sell and buyer’s offer to buy the Note are irrevocable and binding. Please note, however, that a trade may be subject to automatic cancellation if certain characteristics of the Note change during the listing or settlement period.

Click here to read more about when trades will be cancelled automatically.

A trade or listing may be cancelled for the following reasons:

  • Lending Club is processing a payment that was received on the loan corresponding to the listed Note.  
  • Lending Club received a special payment from a Borrower and Lending Club is in the process of distributing that payment to investors.  
  • The loan corresponding to the listed Note moved into a Default or Charge Off status.
  • A bankruptcy filing related to the loan corresponding to the listed Note is pending.

Purchasing Notes

Basic information about a Note and corresponding loan is provided by Lending Club on the Browse Notes page of the Note Trading Platform. Information on that page includes:  

  • Loan ID
  • Note ID
  • Interest Rate
  • Term
  • Status
  • Credit Score Change
  • Days Since Payment
  • Remaining Payments
  • Outstanding Principal
  • Accrued Interest
  • Principal + Interest
  • Asking Price
  • Markup/Discount
  • Yield to Maturity
Additional information provided by Lending Club about a Note and corresponding loan, such as Borrower payment history, loan collections details, loan issue date, loan amount, etc., can be viewed on the Loan Performance page by clicking on the loan Status in Browse Notes. Folio Investing does not have any role in creating this information and does not validate any of the information provided by Lending Club.

Accrued interest is the interest that has accumulated on a Note during the payment cycle, but that has not yet been collected from the Borrower of the corresponding loan. When the monthly payment from the Borrower is disbursed to investors, accrued interest is paid to the holder of the Note. The person who holds the Note at the time payment is disbursed by Lending Club will receive their portion of the proceeds of that payment.

Yield to Maturity (YTM) is the rate of return expected on a Note held to maturity. The YTM calculation assumes:

a) The Note is purchased at the listed price,
b) The Note is held to maturity,
c) All payments are received in full and on schedule according to the original terms of the loan, and
d) Lending Club collects its servicing fee.

For non-current Notes and payment plans, the YTM calculation assumes the borrower will resume paying the contractually-owed amount on the next payment due date and will continue monthly payments thereafter until the full outstanding principal is paid. For example, if the borrower is 3 payments behind when the loan is sold, the YTM calculation assumes that final payment will be made 3 payments after the original final payment date. (The YTM calculation does not assume a one time “catch up” payment will be made to bring the loan current within its initial term.)

YTM is only one means of assessing the potential value of a Note and should be used in concert with other items such as loan status, payment history, Markup/Discount, etc. Because any loan may have a status other than “current” during its term, YTM is speculative and is provided merely as a point of reference and not as any type of investment advice, guidance or guarantee regarding the performance of a Note.

Once you own the Note you purchased on the Note Trading Platform, the Note is delivered to your Lending Club portfolio and is held just like any Note you would purchase on the Lending Club platform. You may view information regarding the purchase transaction in your Folio Investing Note Trading Account. You may view the Note on the “My Notes” page of the Lending Club platform. Any payments received will be reflected in your Lending Club account. Folio Investing does not hold Notes or money overnight on behalf of any participants in the Note Trading Platform.

The Asking Price of a Note is determined by the seller. Notes may be listed at prices ranging from $0.01 up to 70% above the total value of accrued interest plus outstanding principal. Prior to submitting any purchase order, Buyers should understand how the price and other factors affect the expected yield to maturity of any Note. Buyers are not charged a fee for purchasing a Note on the Note Trading Platform. Keep in mind that Lending Club charges a service fee on every cash payment that an owner of a Note receives.

Once you have applied for a Note Trading Account and have been approved by Folio Investing, you may purchase Notes on the Note Trading Platform.

In order to purchase Notes on the Note Trading Platform, click the “Browse Notes” link from the navigation bar at the top of the page. The Browse Notes page displays Notes currently listed for sale on the Note Trading Platform. You may use the filter to narrow or expand the Notes displayed on the page. Once you have located a Note or Notes you would like to purchase, you may add them to your order.

Once you are ready to review and place your order, click the “View Order” button to review the Notes that are part of your order. Once you have reviewed and confirmed the Notes in your order, click “Submit” to submit the order for settlement. Orders take approximately 1 business day to settle.

The Asking Price of a Note is determined by the seller. Notes may be listed at prices ranging from $0.01 up to 70% above the total value of accrued interest plus outstanding principal. Prior to submitting any purchase order, Buyers should understand how the price and other factors affect the expected yield to maturity of any Note. Buyers are not charged a fee for purchasing a Note on the Note Trading Platform. Keep in mind that Lending Club charges a service fee on every payment that an owner of a Note receives.

The decision to buy a Note and which Note you buy should be based on your own investment strategy and personal circumstances. Neither Folio Investing nor Lending Club provides investment advice and recommends that you consult your financial advisor if you have questions about whether to purchase a Note.

Information regarding the loan status, term remaining, Borrower payment history, and the Borrower’s most recent credit score, as well as other factors, may impact the way that you value and decide whether to purchase the corresponding Note.  
Buyers should be aware that some sellers list Notes for an Asking Price that is greater than the total outstanding principal and accrued interest, or that have a status of “Past Due.”  Prior to submitting any purchase order, Buyers should understand how these and other factors affect the expected yield to maturity of any Note.

If you want to buy a Note corresponding to a loan that is past-due, you may be interested in historical information about loan status migration provided by Lending Club, which can help you understand how the status of loans has changed historically over time. Please click here to access this information. Please keep in mind that past performance is not a guarantee of future results and that actual loan status migration may vary significantly from historical migration.

The grade of a Note is assigned by Lending Club at the time the application for the corresponding loan is approved and the loan is issued. Notes are not re-graded over time, and therefore the grade of the Note may not reflect the Borrower’s current credit score, credit report, or financial situation. As a result, you should not rely on the grade of the Note to assess the risk associated with purchasing a Note on the Note Trading Platform.

Interest and other payments received in your Lending Club account are generally taxable.

Lending Club does not provide tax, financial, or legal advice and this information is not intended to be tax, financial, or legal advice. Lending Club recommends that you consult your financial or tax advisor if you have any questions.

No, neither the buyer nor the seller may cancel a trade that is pending settlement. Once the settlement process begins, the seller’s offer to sell and buyer’s offer to buy the Note are irrevocable and binding. Please note, however, that a trade may be subject to automatic cancellation if certain characteristics of the Note change during the listing or settlement period.

Click here to read more about when trades will be cancelled automatically.

It is up to you to decide how much a Note is worth.  Neither Folio Investing nor Lending Club provide investment advice and you should consult your financial advisor if you have questions about the value of a Note.
 
Information regarding the loan status, term remaining, Borrower payment history, and the Borrower’s most recent credit score, as well as other factors, may impact the way that buyers and sellers value the corresponding Note.  
 
Buyers should be aware that some sellers list Notes for an Asking Price that is greater than the total value of the outstanding principal and accrued interest, or that have a status of “Past Due.”  Prior to submitting any purchase order, Buyers should understand how these and other factors affect the expected yield to maturity of any Note.
 
If you want to buy a Note corresponding to a loan that is past-due, you may be interested in historical information about loan status migration provided by Lending Club, which can help you understand how the status of loans has changed historically over time. Please keep in mind that past performance is not a guarantee of future results and that actual loan status migration may vary significantly from historical migration.

A trade or listing may be cancelled for the following reasons:
  • Lending Club is processing a payment that was received on the loan corresponding to the listed Note.  
  • Lending Club received a special payment from a Borrower and Lending Club is in the process of distributing that payment to investors.  
  • The loan corresponding to the listed Note moved into a Default or Charge Off status.
  • A bankruptcy filing related to the loan corresponding to the listed Note is pending.

Selling Notes

A Note is not eligible to be sold on the Note Trading Platform if:

  • Lending Club is processing a payment that was received on the loan corresponding to the listed Note.  
  • The loan corresponding to the listed Note moved into a “Default” or “Charge Off” status.
  • A bankruptcy filing related to the loan corresponding to the listed Note is pending.

You should be prepared to hold any Note you purchase through to its final maturity.

Accrued interest is the interest that has accumulated on a Note during the payment cycle, but that has not yet been collected from the Borrower of the corresponding loan. When the monthly payment from the Borrower is disbursed to investors, accrued interest is paid to the holder of the Note. The person who holds the Note at the time payment is disbursed by Lending Club will receive their portion of the proceeds of that payment.

Generally, a short term gain or loss applies to Notes that have been held for one year or less, while a long-term gain or loss applies to Notes that have been held for more than one year. Depending on your particular circumstances, there may be tax implications to the treatment of a gain or loss as short term or long term.

Neither Folio Investing nor Lending Club provides tax advice and recommends that you consult your financial or tax advisor if you have any questions or need additional information.

The Note Trading Platform is a tool to provide liquidity to investors by allowing them to directly sell their Notes to other investors. The Note Trading Platform is not intended to be a forum to speculate in the value of Notes. The maturity on Notes at origination is 36 months or 60 months and you should be prepared to hold any Note through to its final maturity. However, should the need for liquidity arise, you may be able to use the Note Trading Platform to sell some or all of your Notes.

Neither Folio Investing nor Lending Club provides investment advice and recommends that you consult your financial advisor if you have any questions or need additional information.

Yield to Maturity (YTM) is the rate of return expected on a Note held to maturity. The YTM calculation assumes:

a) The Note is purchased at the listed price,
b) The Note is held to maturity,
c) All payments are received in full and on schedule according to the original terms of the loan, and
d) Lending Club collects its servicing fee.

For non-current Notes and payment plans, the YTM calculation assumes the borrower will resume paying the contractually-owed amount on the next payment due date and will continue monthly payments thereafter until the full outstanding principal is paid. For example, if the borrower is 3 payments behind when the loan is sold, the YTM calculation assumes that final payment will be made 3 payments after the original final payment date. (The YTM calculation does not assume a one time “catch up” payment will be made to bring the loan current within its initial term.)

YTM is only one means of assessing the potential value of a Note and should be used in concert with other items such as loan status, payment history, Markup/Discount, etc. Because any loan may have a status other than “current” during its term, YTM is speculative and is provided merely as a point of reference and not as any type of investment advice, guidance or guarantee regarding the performance of a Note.

Notes can be listed for sale for up to 7 calendar days, after which your offer to sell will expire. If a Note you have listed does not sell prior to its expiration date, or if the listing for your Note is automatically canceled because Lending Club begins processing a borrower payment on the underlying loan, you may re-list the Note for sale as many times as you like.

If a Note does not sell, the seller may choose to hold the note to its final maturity or relist the Note for sale at the same or a different Asking Price.

Only you can decide which Notes to sell.  Neither Folio Investing nor Lending Club provides investment advice and recommends that your consult your financial advisor to ensure that any sale of Notes reflects your investment strategy and is appropriate for your personal financial situation.

There are many things you might consider before listing a Note for sale, including the interest rate, the payments received, the remaining payments, and the loan status. Remember that in addition to picking which Notes to sell, you also set the Asking Price of your Note. For more information about pricing your Notes, please click here.

The grade of a Note is assigned by Lending Club at the time the application for the corresponding loan is approved and the loan is issued. Notes are not re-graded over time, and therefore the grade of the Note may not reflect the Borrower’s current credit score, credit report, or financial situation. As a result, you should not rely on the grade of the Note to assess the risk associated with purchasing a Note on the Note Trading Platform.

Interest and other payments received in your Lending Club account are generally taxable.

Lending Club does not provide tax, financial, or legal advice and this information is not intended to be tax, financial, or legal advice. Lending Club recommends that you consult your financial or tax advisor if you have any questions.

No, neither the buyer nor the seller may cancel a trade that is pending settlement. Once the settlement process begins, the seller’s offer to sell and buyer’s offer to buy the Note are irrevocable and binding. Please note, however, that a trade may be subject to automatic cancellation if certain characteristics of the Note change during the listing or settlement period.

Click here to read more about when trades will be cancelled automatically.  

A trade or listing may be cancelled for the following reasons:

  • Lending Club is processing a payment that was received on the loan corresponding to the listed Note.  
  • Lending Club received a special payment from a Borrower and Lending Club is in the process of distributing that payment to investors.  
  • The loan corresponding to the listed Note moved into a Default or Charge Off status.
  • A bankruptcy filing related to the loan corresponding to the listed Note is pending.

The price of a Note is determined by the seller. The rules of the marketplace require that a Note not be priced at a markup greater than 70% of the total value of accrued interest and outstanding principal or that would otherwise produce a negative yield to maturity. Neither Folio Investing nor Lending Club provide investment advice and you should consult your financial advisor if you have questions about the value of a Note.
 
Information regarding the loan status, term remaining, Borrower payment history, and the Borrower’s most recent credit score, as well as other factors, may impact the way that buyers and sellers value the corresponding Note.  
 
If you want to sell a Note corresponding to a loan that is past-due, you may be interested in historical information about loan status migration provided by Lending Club, which can help you understand how the status of loans has changed historically over time. Please click here to access this information. Please keep in mind that past performance is not a guarantee of future results and that actual loan status migration may vary significantly from historical migration.

It is up to you to decide how much a Note is worth.  Neither Folio Investing nor Lending Club provide investment advice and you should consult your financial advisor if you have questions about the value of a Note.
 
Information regarding the loan status, term remaining, Borrower payment history, and the Borrower’s most recent credit score, as well as other factors, may impact the way that buyers and sellers value the corresponding Note.  
 
Buyers should be aware that some sellers list Notes for an Asking Price that is greater than the total value of the outstanding principal and accrued interest, or that have a status of “Past Due.”  Prior to submitting any purchase order, Buyers should understand how these and other factors affect the expected yield to maturity of any Note.
 
If you want to buy a Note corresponding to a loan that is past-due, you may be interested in historical information about loan status migration provided by Lending Club, which can help you understand how the status of loans has changed historically over time. Please keep in mind that past performance is not a guarantee of future results and that actual loan status migration may vary significantly from historical migration.

About the Note Trading Platform

Notes are sold on the Note Trading Platform by individuals or entities with a Lending Club investment account and an approved Folio Investing Note Trading Platform Account. Buyers should be aware that some sellers list Notes for an Asking Price that is greater than the total value of the outstanding principal and accrued interest.

Please click here to learn more about selling Notes. 

Folio Investments, Inc. (“Folio Investing”) is a registered broker-dealer and a member of FINRA and SIPC. Folio Investing is based in Vienna, VA and is not affiliated with LendingClub Corporation. Folio Investing operates the Note Trading Platform as an SEC approved alternative trading system (ATS). More information about Folio Investments, Inc. (“Folio Investing”) is available at www.folioinvesting.com.

Folio Investing has no role in the original issuance of the Notes and is not responsible for and does not approve, endorse, review, recommend or guarantee the Notes or the accuracy, reliability, or completeness of any data or information about the Notes.

Notes are bought on the Note Trading Platform by individuals or entities with a Lending Club investment account and an approved Folio Investing Note Trading Platform Account.

There are a variety of reasons buyers choose to buy Notes on the Note Trading Platform. Some buyers seek to purchase Notes at a discount. Other buyers may live in a state that only permits them to invest in Notes in a secondary market transaction.

Please click here to learn more about buying Notes.

Qualifying investors with Lending Club accounts are allowed to purchase Notes on the Note Trading Platform. In order to trade Notes, you must first sign up as an investor with Lending Club (there is no obligation to lend money), then sign up and be approved by Folio Investing as a trading member with Folio Investing. It is free to sign up with both Lending Club and Folio Investing.

Note holders that live in Ohio are not eligible to trade Notes on Folio Investing as the Notes have not been registered for resale in those states by Lending Club.

Answers to most commonly asked questions regarding selling or buying Notes are listed in this FAQ.

If you need technical assistance with your Note Trading Account, please contact Investor Services at investing@lendingclub.com.  All other questions should be directed to Folio Investing at support@folioinvesting.com

To understand the risks of the Note Trading Platform, you should first understand the risks of investing in Notes. This includes the risk that you may lose all or most of the principal invested. Before purchasing any Notes, you should carefully read the prospectus, including the “Risk Factors,” which provides detailed information about the risks of investing in Notes.

Buying or selling Notes on the Note Trading Platform carries risks that are in addition to those described in the prospectus: there is limited information available about Notes listed for sale on the Note Trading Platform and, in addition, the prices for such Notes are set by the seller, not by Lending Club or by Folio Investing.  As a result, the Asking Price may be far above or far below the total value of the outstanding principal and accrued interest.  The Asking Price of a Note can significantly impact the income the buyer could expect to receive from the Note and the past performance of any Note is not a guarantee of any future results. Notes on the Note Trading Platform are only suitable for sophisticated investors.  You should consult your financial advisor to ensure that any purchase of Notes reflects your investment strategy and is appropriate for your personal financial situation.

Individual Retirement Accounts are eligible for purchasing and selling Notes on the Folio Investing Note Trading Platform.  You may apply for an account with Folio Investing by clicking the “Trading Account” or “Trade Notes” link on your Lending Club Account Summary page. Please be aware that the Folio Investing Note Trading Platform is not available to residents of all states.

Please keep in mind that taking distributions from a retirement account can have tax implications. You should consult a tax or financial advisor for more information.

The Note Trading Platform is a marketplace run by FOLIOfn Investments, Inc. (referred to as Folio Investing), a registered broker-dealer, where Lending Club investors who have been granted access by Folio Investing may buy and sell Notes at prices agreed to between the buyers and sellers. Folio Investing is not affiliated with Lending Club. Each Note corresponds to a loan or portion thereof issued on the Lending Club platform and serviced by Lending Club. The Notes were originally issued by Lending Club in an offering registered with the Securities and Exchange Commission (SEC). You can learn more about the Notes by reading the prospectus filed with the SEC.

Folio Investing is a member of FINRA and SIPC.  Folio Investing is based in McLean, VA and is not affiliated with LendingClub Corporation. Folio Investing operates the Note Trading Platform as an SEC approved alternative trading system (ATS). More information about Folio Investing is available at www.folioinvesting.com.

Folio Investing has no role in the original issuance of the Notes and is not responsible for and does not approve, endorse, review, recommend or guarantee the Notes or the accuracy, reliability, or completeness of any data or information about the Notes.

The owner of a Note lists a Note for sale and sets the Asking Price for that Note. Potential buyers browse the Notes available for sale on the Note Trading Platform and review information about each Note. When a buyer finds a Note that they would like to purchase for the Asking Price, they place an order for that Note. The trade for the Note settles approximately 1 business day after the buy order is submitted.
 
Once the trade settles, the Note is transferred from the seller’s Lending Club account to the buyer’s Lending Club account. The funds used to purchase the Note are similarly moved first from the buyer’s Lending Club account to Folio Investing for the benefit of the purchaser and then to the account of the seller. Upon settlement, Folio Investing charges the seller of a Note a transaction fee equal to 1% of the Asking Price. The Note(s) and the net proceeds of the sale are then delivered by Folio Investing to the respective Lending Club accounts of the buyer and seller.
 
Both buyers and sellers may monitor their trading activity on the ‘My Account’ page of the Note Trading Platform. More information about monitoring your trades can be found here.
 
Frequently asked questions about buying Notes can be found here.
Frequently asked questions about selling Notes can be found here.

Signing up for a Folio Investing Note Trading Account is free of charge. Folio Investing charges the seller of a Note a transaction fee equal to 1% of the purchase price of the Note. The transaction fee is charged once the trade has settled. If a trade is canceled, no fee is charged.

Folio Investing does not charge a fee to the purchaser of a Note. However, Lending Club charges a fee to each Note holder. Lending Club charges a fee of one percent (1%) of the amount of any payments received within 15 days of the payment due date from the Borrowers on the loan corresponding to the Note.

Lending Club will charge investors one of the following collection fees, which will be deducted from any amount recovered:1) 18% of the amount recovered if the loan is 16 or more days late and no litigation is involved, or 2) 30% of hourly attorneys’ fees, plus costs, if litigation is involved. These fees are deducted by Lending Club from the payment proceeds at the same time (or immediately after) they are deposited into the Note holder’s Lending Club account.

Please note that the collection fee described above is a reduced collection fee, which may be discontinued at any time. The normal collection fee is a percentage of the amount recovered: 30% if the loan is less than 60 days past due and no more than 90 days from the date of origination; 35% in all other cases, except litigation; 30% of hourly attorneys’ fees in the event of litigation, plus costs.

Folio Investing plays no role in processing payments from Borrowers or in servicing the Notes.

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