SoFi's personal loan product is just one offering from this broader marketplace lender that specializes in offering low-interest loans to people with high incomes and excellent credit. SoFi used to only offer loans to graduates who wanted to refinance their student loans but has more recently branched out into personal installment loans and mortgages. Although the San Francisco-based company is still a relatively new player in the business, it is already a leader in online lending. As of November 2015, SoFi has funded over $5 Billion in loans.
How Does SoFi Work?
SoFi has only offers loans to people with high incomes and excellent credit. To illustrate, the average credit score of SoFi's customers is 780 and their average income is $150,000. This allows SoFi to offer very low interest loans on unsecured personal loans.
To apply borrowers must create an account. Once the information is verified, the marketplace's platform provides applicants with a selection of available loans. Borrowers then select which loan meets their needs, sign electronically the loan agreement, and receive their funds within a few days. As well as personal loans, SoFi also provides student loans and mortgage loans.
What Are SoFi's Interest Rates?
Interest rates range from:
- 5.95% to 14.24% APR for fixed rates with autopay.
- Variable rates have starting rates ranging from 4.83% to 11.43% APR and are capped at 14.95% APR.
These rates include a 0.25% discount for people who enrol in autopay. If you opt out of autopay, add 0.25%.
How Much Money Can I Borrow from SoFi?
SoFi offers loan amounts of $5,000 to $100,000 with loan terms of 3 to 7 years.
Which States Does SoFi Operate In?
SoFi operates in all states except Idaho, Louisiana, Mississippi, Nevada and Tennessee.
What Is SoFi's Application Process Like?
The application process is simple but getting approved isn't. To start the ball rolling applicants must create an account and provide basic personal information and income details. SoFi then performs a soft credit pull, which doesn't hurt your credit, so as to provide a firm interest rate offer. If the loan is accepted a full credit check is required, which may ding your credit a little.
Apart from excellent credit and high income, SoFi also requires borrowers to have graduated from a university accredited by the U.S. Department of Education for student loans.
How Is SoFi Better Than Other Lenders?
SoFi offers large installment loans at extremely low interest rates to prime and super-prime borrowers. The process is simple and fast, and there are no origination fees, closing costs or prepayment penalties. Loan terms extend up to 7 years, which gives lenders the flexibility to finance large purchases. SoFi's personal loans also include unemployment protection. So if you lose your job SoFi will pause your monthly loan payments and help you find another job.