I've been on the investor side for around 3 years, a big IRA and a regular account. It's fantastic, I've averaged 7-8% (on a yearly basis) month in and month out. Never had a down month. I think the key is having anough funds to be very diversified... $20k means your have a piece of 400 different loans, and at that level a good chuck can default and you'll still be in the black. If you only invest the minimum, your chances of being in the red go up. Their statistics say that no one has lost money on a 400 loan portfolio. I have about triple that I'd guess.
The other thing to note is you'll lose some liquidity. In general, you should plan to get around 2-3% of your capital back as cash each month. The rest will still be in the loans, getting paid back. They do have a "marketplace" where you can sell these loans to others, and from what I have heard there's a small discount, plus LC charges a 1% fee. So, you may be able to cash out early at a 2-3% discount. So on a good loan, you won't lose money after 6 months or so. I've never done this route though. I'm pretty pleased to just reinvest the cash that is produced.
