In this Review..
SoFi is a credit company that offers a variety of personal loan options. These options may be used for credit card consolidation, home improvement, family planning, travel, and even for weddings. They don’t charge any fees for their services and are a good loan option for anyone with a credit score of at least 680.
This company offers competitive rates and allows for joint applications too. Unlike other lenders, SoFi has unemployment protection in the case of falling on hardship. They have competitive rates, only do a soft pull inquiry upon application, and offer an autopay discount too.
SoFi is a fixed rate lending company and has term limits ranging from 2-7 years depending on your loan type. When borrowing from them, SoFi offers you anywhere between $5,000-$100,000 for your monetary needs.
These certainly are great benefits, however, there are some things to keep in mind before you decide to move forward. SoFi has high requirements for their applicants and slow turnaround times on their loans. They require a higher minimum amount, limited usage, and they aren’t available in all 50 states either.
SoFi is an online lender with a unique underwriting model. It's best for those who have a long, solid credit history.
APR
4.99%-19.63%
Loan Amount
$5,000 – $100,000
Term
24-60 months
Min score
680
The original idea of SoFi was to have school alumni invest funds in refinancing recently-graduated students’ debt. SoFi has moved away from that business model and moved to a “non-traditional underwriting approach focused on lending to financially responsible individuals. SoFi uses an underwriting model that examines free cash flow, professional history and education in addition to a history of responsible bill payment to evaluate its borrowers.”
SoFi offers plenty of benefits for those who qualify for a personal loan. They also have some of the highest credit and cash flow standards. Also, SoFi offers professionals many benefits and tools that can help them become more financially independent.
Sofi Loan Pros & Cons
As we know, each lender has its own pros & cons – here are the relevant things we found for potential borrowers:
Pros
- Joint Borrowers – SoFi allows for joint borrowers on their personal loans as of April 2018. Many loan providers do not allow for this.
- Soft Pull Inquiry – SoFi does an initial soft pull inquiry so the borrower can get an idea of the options for which they may qualify.
- Competitive Interest Rates –SoFi has very competitive rates for strong borrowers.
- Referral Program – SoFi has a referral program that allows borrowers to earn $300 per referral. Your referral will also get a $100 welcome bonus.
- More than One Loan – The borrower can get two loans at the same time from SoFI.
- No Fees – SoFi personal loans have no origination or late fees. They also do not have a prepayment penalty so the loan can be paid off early without additional costs.
- Flexible Payments – SoFi gives borrowers flexibility in payments. They allow you to change payment due dates and do not charge late fees.
- High Maximum Loan Amount – SoFi’s highest maximum loan amount is $100,000 for personal loans.
- Autopay Discount – SoFi allows for a .25% discount if you sign up for auto pay.
Cons
- Slower Turnaround Times –It can take many days to fund your loan and then a few days longer to send your money. If you need money more quickly, there are other providers that can turn around your application much faster.
- Limited Uses – SoFi has more restrictions regarding how their personal loans can be used.
- Only Available to the Strongest Borrowers – If you do not have the best credit history, you may not be able to get a loan through SoFi. They cater to those with very good to excellent credit histories and very strong cash flows.
- Higher Minimum Amount –The lowest personal loan amount you can get with SoFi is $5,000.
- Not Available in All States –SoFi does not operate in Mississippi.
Loan Details
Here are the basic specifications & requirements of SoFi Personal Loan :
Loan Terms | SoFi Personal Loan |
|---|---|
Loan Amount Range | $5,000 – $100,000
|
Interest Rate Range | Fixed, 4.99%-19.63%
with auto pay |
Term | 24-60 months
|
Origination Fee | None
|
Late Payment Fee | None
|
Returned Payment Fee | None
|
Check Processing Fee | None
|
Prepayment Fee | None
|
Minimum Credit Score | 680
|
Funding | Up to 7 days
|
What Can a SoFi Personal Loan Be Used For?
SoFi offers personal loans for many different reasons including debt consolidation, home improvements, relocation, medical expenses, and auto refinancing. SoFi has many restrictions on what their personal loans can be used for.
For example, you cannot use their personal loans for purchasing real estate, business purposes, investments or purchase securities, any postsecondary education or as short-term bridge financing.
- Home Improvement
SoFi home improvement loans are for home repairs or renovations.
The advantage of using a SoFi home improvement loan is that you do not have to use your home as collateral and you get funds much quicker with less documentation. Typically, it takes a month or more to get an equity line of credit on your home.
- Relocation
Moving can be expensive. There are many costs associated with moving and SoFi can help cover those moving costs.
- Medical Expenses
SoFi loans for medical expenses help borrowers manage large, unexpected medical costs. This can include costs for drugs, selective surgery, and adoption.
- Debt Consolidation
SoFi debt consolidation is paying off one or more prior unsecured loans with the new SoFi loan. Instead of multiple payments to multiple lenders you can create one payment to one lender. The idea is that you can take a high revolving interest credit card and save money by replacing it with a low rate fixed installment.
SoFi offers variable rates as well, but still provides a term that clearly indicates when you will be out of debt. SoFi also has a debt consolidation calculator, so you can get an idea of how much you can save.
- Auto Refinancing
SoFi personal loans can be used to buy a new or used car or for refinancing your current auto loan. If you have good credit history you may even get a better rate. One advantage is that you do not have to use your car as collateral and you may be able save some money since you won’t need gap insurance
SoFi Reputation
- A on BBB: BBB assigns ratings from A+ (highest) to F (lowest). BB ratings are based on information in BBB files with respect to factors such as the business's complaint history with BBB, type of business, time in business, transparent business practices, and more.
- 3.5/5 on Trustpilot ( +2400 reviews): TrustScore is also an overall measurement of reviewer satisfaction, represented numerically from 1 to 5.
- 871/1000 points on J.D Power: SoFi ranks 4th in the study and got 871 out of 1000 possible points in the 2020 research, higher than industry average. .J.D Power offers the most comprehensive and independent study of personal loans consumer satisfaction . The study aims to help consumers and issuers to understand user opinions and ratings of top lenders. It covers terms, benefits, services, communication, transparency and more.
How to Apply for SoFi Loan?
Here are the steps you should take on Sofi website if you would like to apply for SoFi personal loan:
- 1.
SoFi takes a broader look at its borrowers than just evaluating their credit scores. SoFi requires a better understanding of their borrowers’ ability to repay.
- 2.
Taking this into consideration, understand that SoFi will have more questions and require more documentation than some other personal loan providers.
- 3.
The application process begins with you creating an account and answering a few questions. SoFi will do a soft pull on your credit. A soft pull does not affect your credit report. At this point, you could be declined. Otherwise, SoFi will give you a list of options for which you can apply. If you want to move forward, SoFi will do a hard credit check and you will then be asked to upload documents to verify information.
- 4.
You may need to provide pay stubs, bank statements, W-2s, social security card, or state ID. You can sign loan documents online. SoFi also offers a .25% discount if you set up auto pay.
- 5.
SoFi will usually let you know whether you are approved within one day. Because SoFi checks your documentation, it usually takes up to 7 days for your loan to be funded. SoFi may also call you directly to verify some information.
SoFi FAQs
Is SoFi a good place to get a loan?
SoFi is an excellent lender offering a large maximum loan amount at reasonable rates. The loans also have zero fees, flexible repayment terms and fast funding. However, you do need to have a credit score of more than 680 to qualify.
What makes SoFi a good place to get a loan is that there are also perks offered to customers. As a SoFi member, you’ll have access to an active online community, referral bonuses, financial advice, and complimentary estate planning.
Does SoFi check your bank account?
SoFi does evaluate loan applications based on credit score, financial history and income vs expenses. This typically involves a soft credit pull, but in some cases SoFi may need to verify your details by checking your bank transactions. This will allow SoFi to finalize your application and issue a formal offer with a confirmed rate.
Is SoFi better than Best Egg?
SoFi does offer more favorable terms compared to Best Egg. The maximum loan amounts are higher and you can take a longer term with a SoFi Loan. While Best Egg has similar starting rates, the maximum rate is higher. Additionally, Best Egg loans have an origination fee of up to 5.99%.
So, unless you are only looking to borrow a small amount, SoFi is a far better choice.
Is SoFi better than FIGURE?
FIGURE offers loans with a far lower maximum loan amount but potential longer terms and lower rates. While the rates are lower, they are obviously more designed for offering a debt consolidation solution rather than a basic personal loan. However, FIGURE also requires a FICO score of 680 or more, so you will still need good credit. FIGURE also requires that applicants have a debt to income ratio of 40% or less.
If you’re looking for debt consolidation, FIGURE is a solid option, but if you’re looking for a loan for another purpose, SoFi is a more flexible option.
Is LightStream better than SoFi?
SoFi has more similarities to LightStream compared to Marcus. Both companies offer loans up to $10,000 with no fees. Additionally, SoFi’s rates are similar if you have good credit and use autopay.
Both lenders are suited to those with good to excellent credit. SoFI is best suited to those who want a shorter term loan, as LightStream offers longer terms of up to 12 years, rather than the 7 offered by SoFi. However, SoFi does have less stringent criteria, so if you may struggle to meet the LightStream requirements, SoFi could be a good alternative.
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Learn more about how we review products and read our advertiser disclosure for how we make money. All products are presented without warranty.
This website is an independent, advertising-supported comparison service. The product offers that appear on this site are from companies from which this website receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). This website does not include all card companies or all card offers available in the marketplace. This website may use other proprietary factors to impact card offer listings on the website such as consumer selection or the likelihood of the applicant’s credit approval.
This allows us to maintain a full-time, editorial staff and work with finance experts you know and trust. The compensation we receive from advertisers does not influence the recommendations or advice our editorial team provides in our articles or otherwise impacts any of the editorial content on The Smart Investor. While we work hard to provide accurate and up to date information that we think you will find relevant, The Smart Investor does not and cannot guarantee that any information provided is complete and makes no representations or warranties in connection thereto, nor to the accuracy or applicability thereof.
Learn more about how we review products and read our advertiser disclosure for how we make money. All products are presented without warranty.
Alternatives Lenders For Consideration
Here are our 3 choices of lenders which can use as a great alternative to SoFi personal loan:
- LendingPoint
Lending Point is based in Kennesaw, Georgia. This online lender offers a competitive option for those with fair credit.
Lending Point personal loans have a relatively high interest rate of 15.49% to 35.99%. You can borrow $2,000 to $25,000 with a term of 24 to 48 months.
Where Lending Point stands apart from many lenders is that you can qualify for a loan if your credit score is 585 or above. The company will also consider other factors to establish your eligibility including:
- Income
- Financial history
- Job history
- Overall credit behavior.
Lending Point does not have prepayment fees, but there is a potentially costly origination fee. This can be zero to 6% depending on your location. There is also a $30 late payment fee, applied after a 15 day grace period.
- Prosper
Prosper is the first peer-to-peer lending marketplace, a platform that matches lenders with borrowers.
Prosper marketplace is a great place to start in your personal loan search. Prosper focuses on the mass market of borrowers and their personal loans can be used for a wide range of reasons. They also have a lending arm for medical costs, Prosper Healthcare Lending. They offer personal loans for a wide variety of purposes and to a large market of borrowers.
They do have a high origination fee while other providers do not have one. The process will take longer than with other platforms, so if you need funds quickly Prosper may not be the right place to start your search.
