Who Can Invest at Lending Club?

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Try it Now! Join Lending Club.In the comments of the $100 Lending Club giveaway, Reader Barry said it would’ve been nice if I had notified you all about the restriction on Lending Club investors. Well Barry, you asked and thus you shall receive!

There are two parts to Lending Club. There is the actual Lending Club site, where you invest in notes (loans), and there is the Note Trading Platform, where you can trade notes.

Lending Club Investor Rules

At the moment, you can invest in Lending Club notes if you live in the following states: California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Louisiana, Minnesota, Mississippi, Montana, New Hampshire, Nevada, New York, Rhode Island, South Carolina, South Dakota, Utah, Virginia, Washington, Wisconsin, West Virginia, and Wyoming. As you can see, my home state of Maryland is not included.

In addition to the state restrictions, there are income and net worth requirements as well. If you live in an eligible state outside of California, you need:

  • a gross income greater than $70,000 and a net worth (excluding home, car, and home furnishings) of at least $70,000, or
  • a net worth (excluding the same) of at least $250,000.

If you live in California, you’ll need income greater than $100,000 and net worth (same exclusions) of $100,000 or a net worth greater than $250,000.

FOLIOfn Note Trading Platform Investor Rules

The Lending Club Note Trading Platform is powered by FOLIOfn Investments is a registered broker dealer member of FINRA and SIPC and they manage the Note Trading Platform. You can use it to buy and sell notes if you sign up to be a trading member with FOLIOfn (free), after signing up for Lending Club. The restrictions on the Note Trading Platform are much looser, you can invest as long as you don’t live in District of Columbia, Kansas, Maryland, Ohio, Oregon, Texas, or Vermont.

Again, Marylanders are excluded. 🙁

{ 29 comments, please add your thoughts now! }

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29 Responses to “Who Can Invest at Lending Club?”

  1. Sure, those rules exist, but you forgot (and broke) the first two rules.

    The first rule of Lending Club is you do not talk about Lending Club.

    You can work out the second rule for yourself.

  2. Zyzzyx says:

    OK… I’m confused. Why the income restrictions? I was rather interested in putting some money towards this, but I’m only making ~$50k/yr and I certainly don’t have a net worth that high.

    Gee, thanks LC, guess I’ll take my money and go play elsewhere, if I can.

    • Jim says:

      I don’t know why those exist and I don’t know how they confirm it.

      • Jill says:

        I always thought those restrictions were for borrowers, not lenders? I am a lender and certainly don’t qualify under those restrictions – and I have never been asked to verify. I am definitely going to be looking into this!!

        • Jim says:

          The state eligibility or the income ones?

          • eric says:

            I think it’s income because I’m a lender and I don’t qualify under those rules either. I did read about them before opening my account but LC didn’t seem to care or check. *shrugs*

      • nickel says:

        I’ve heard through the grapevine that they don’t actually verify the income requirements for lenders so, as long as you have money to lend and live in an eligible state, you should be good to go.

  3. StephaniePTY says:

    I still have not received a sufficient answer from the folks at Lending Club as to whether the income/net worth requirements are for your household (as they are for credit cards) or you as an individual. The answer I did get to my email was extremely wishy-washy, telling me that the states required these restrictions. But I never got an answer to my actual question.

  4. Lucy says:

    It appears to me that despite the income and networth restrictions published on their website, Lending Club doesn’t really enforce them. I don’t remember having to verify my income and networth at all.

  5. barry says:

    Wow Jim! Talk about service!

    Thank you for putting this out there!

  6. EmBee says:

    I’m in NJ. according to the rules, not a legible state.. however, I registered to invest and my identity has been successfully verified. And I already got to the point to put an external bank account.. should I put it in?


    • carole says:

      EmBee, I’m from NJ too. What did you find out?

      • EmBee says:

        I just linked my bank account to it and deposit some money…it’s slow. at least we can buy the the other’s selling notes, I guess.

  7. Splendor says:

    Weird. I wonder why there are income restrictions for lenders.

    • Sean says:


      Because the government is taking care of you. You must be approved to do what you want with your money little citizen, just shutup and go back to work haha.

      • RB says:

        The SEC does have specific standards for what they call ‘accredited investors’.

        Investors qualify by having at least a certain minimum income or net worth, and are eligible to participate in certain investments not open to others.

        Richard Kiyosaki discusses accredited investors and their requirements in his Rich Dad Poor Dad books.

  8. Sherman Frey says:

    I exceed all the restrictions but I guess I can’t invest because I live in Arizona. Is that right?

    • Ryan says:

      I live in AZ, and am currently invested in many loans. I just decide to try to setup and account, and they never stopped me. I have been doing this for about 1 1/2 years so far with no issues.

  9. echidnina says:

    It’s disappointing that so many people are excluded from the program because of regulations. I know it’s out of LC’s control, but why must LC follow these state restrictions and not, say, Kiva? Is it because lenders get interest back?

    • Jim says:

      It’s because with Kiva they’re not securities, you’re just lending money with no interest. I think the issue with LC is that you can trade it like a stock.

  10. aua868s says:

    same with me in Oregon…cant invest in LC

  11. Inaudiblepc says:

    So, say I want to invest and I don’t meet the income requirements. If I invest am I breaking a law? If so what is the penalty for doing so? I really want to invest in LC, any advice would be appreciated.

  12. servusdei says:

    Great article. It pains me that I live in Maryland too and it is excluded. The local banks must have paid huge bribes to Maryland to protect their business here, so they can continue to lend money to people at excessive interest rates like 20% APY and pay only 0.01% APY for their savings accounts. I hate these corrupt Maryland politicians. Let’s hope we can move out of Maryland some day to a freer state.

  13. investor123 says:

    I live in a restricted state. I have been investing in Lendinclub since the beginning. I am confuse why I am able to. I am assuming I will have no protection from the state if something was to happen.

  14. kaaal says:

    this is new to me. will read rich dad poor again to find this point. just short of the income rule, but i’m willing to try this. it does sound fun.

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