Since prosper.com has resumed operations they have added the ability to buy and sell notes that have been issued since they have come back online. I just bought a note of what I think is high quality at a 0.9% discount. I love this trading idea!
The system works much like the secondary mortgage bond market and/or eBay. When selling a note the seller can choose between an auction style listing or a fixed price. The listing lasts for one week. I am going to look for cases where I can get them at a discount and make a larger profit.
I also like having the option of selling some notes down the road if I need the money for something pressing. It only takes 1 day for the trade to settle so you get access to the money quickly after the auction ends. The added liquidity of the notes essentially lowers the risk a little and you are not stuck with them for the full 3 years.
The system is just in it's infancy. All notes for sale now are brand new. It will be interesting to see if notes sell for significant discounts after a year passes and notes are nearer to maturity. I will keep my eyes open for opportunities to profit on having my money tied up and try to leverage it even more.
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