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SoFi, short for Social Finance, was started in 2011 by a Stanford alumni. In the beginning, they were a student loan refinancing company. They grew quickly to include other types of loans such as mortgages, personal loans as well as wealth management and life insurance. Read our SoFi review to see what they can do for you.
SoFi Quick Info
|APR Range||5.49% - 14.95% Fixed and Variable Rates|
|Loan Amounts||$5,000 - $100,000|
|Loan Duration||3 - 7 Years|
|Time to Fund||A Week|
|Soft Credit Check?||Yes|
Who is the Typical SoFi Borrower?
- They have good credit. While there isn’t technically a minimum the average borrower has a credit score over 700.
- They have a very high income. SoFi borrowers have a household average of $101,000.
- They don’t necessarily have a long credit history. An established credit history is always good but there isn’t a minimum length at SoFi.
- They live anywhere in the US other than Nevada. Currently, Nevada is the only state they don’t operate in.
- They make use of the extra perks. SoFi has some interesting extras like career advising and meetups that we’ll expand on in a moment.
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SoFi is a more traditional lending model than Lending Club or Prosper. While those two use the peer-to-peer model, where investors are lending the capital, SoFi is lending the capital. For you, the borrower, it doesn’t make a big difference. What matters is the rate you can get approved for.
SoFi is interesting because in some ways they are not as strict but it doesn’t mean they are easy to get a loan from if you’re a risk. Unlike many of the other lenders, there isn’t a set minimum credit score or credit history length. But these factors are still important and are major factors in whether you’ll get a loan and at what interest rate.
One thing to keep in mind is that the average household income for a SoFi borrower is very high, at $101,000. While we couldn’t find a max debt-to-income ratio it would seem to be a very important factor. Above all, they want to be sure you have the money to pay, more so than even your credit score or history. Seems reasonable to us.
Visit SoFi.com to Apply
How Does SoFi Compare?
SoFi loans are definitely for the higher end of the spectrum. First, they have a higher minimum loan amount than most lenders, $5,000. They also have a high max amount of $100,000. To get anywhere near that max amount you’re going to have to prove yourself.
They also cap out around 15% interest where many of the other lenders get into the 35% range. While this sounds great it also means they are going to be a lot more selective and shut out some of the higher risk loans that others might accept.
SoFi offers mortgage loans up to $3 million in addition to their refinancing and personal loans.
Another thing that they offer that many don’t is adjustable rate loans in addition to the fixed rate. It’s important to understand the pros and cons before going into any adjustable rate loan but it’s good to have the option. Generally, adjustable rates work better with shorter loans since they start lower than fixed rate.
SoFi has a few standout features that we really like.
The first is that they offer free career advising including career transitions, job searches, and personal branding. It seemed a bit odd at first but it seems to help build a sense of SoFi being there to help, instead of just a faceless lender.
The second is that they host meetups all around the country. They range from happy hours and dinners to baseball games and even rock climbing. If you’re outside of a major city you’ll have to drive a bit but it goes a long way to making SoFi feel like a community.
SoFi is pretty forgiving when it comes to late payments or if you’re having trouble financially. They have a 15 day grace period before you get a late fee and the fees are lower than most we’ve seen. They also have up to a year worth of forbearance, where you can pay only interest. It goes for 3 months at a time, up to a year. You’ll still have to pay back everything but it can give you time to recover. Hopefully you’ll never need it but it’s nice to know it’s there.
SoFi also doesn’t charge an origination fee, which means you’ll get the full amount of the loan. Nice!
SoFi Reviews From Around the Web
|Better Business Bureau||3.9/5 - 57 Reviews|
|Credit Karma||5/5 - 217 Reviews|
SoFi Late Fees and Penalties
- Origination fee: None
- Prepayment fee: None
- Late fee: The lower of 4% of payment due or $5, after 15-day grace period
- Check processing fee: None
Business Contact and Profile for SoFi
|Address:||1 Letterman Dr Bldg A STE 4700
San Francisco, CA 94129-1494
|Type of Business:||Financials Services, Loans|
|Principal:||Mr. Mike Cagney, CEO|
|BBB Accreditation:||This business is not accredited with the BBB and has an A+.|