Consumer Credit Crunch! Horrid Loan Losses!

Today is a bad day. For the first time the return on my Prosper.com personal loan portfolio went negative. Since I started lending on Prosper in June 2006 I have lost money. A small amount of money, yes, but still money. And this despite most of my loans being to people with good credit.

Another bad thing is that because Prosper is slow to sell off bad debts, I cannot realize the losses I have suffered for tax purposes and will end up with good-sized taxable gains. I am now going to start slowly withdrawing my money from Prosper. If it weren’t for the negative tax consequences I would probably stick with it a bit longer.

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