Should SoFi Be Your Top Choice for a Personal Loan? Let’s Review

Should SoFi Be Your Top Choice for a Personal Loan? Let’s Review
Lauren Ward
on January 11, 2018
Read in 3 min

SoFi may have high standards when it comes to their customers, but they also have an entire network just for their members and some other benefits as well.

While this article is going to focus on SoFi personal loans, it’s worth noting that the lender also offers student loans, mortgages, and other loans, such as medical resident refinancing and parent loans.

SoFi was founded by Mike Cagney in 2011. Its pilot loan program was designed and implemented for Stanford University students and was funded by Stanford alumni. SoFi’s idea of using college alumni to finance students allowed them to offer loans with lower interest rates than the federal government. They did this by being selective about the students who were able to participate.

That philosophy has followed them throughout the years.

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Who Qualifies for a SoFi Personal Loan

SoFi personal loans tend to have better terms with fewer fees than a lot of their competitors. They’re able to do this because they have stricter guidelines for those whom they offer loans. SoFi also says credit scores are less important to them than other factors such as having the cash flow available to repay the loan.

That being said, the average SoFi customer has a credit score of 700, though they will consider you if you have a credit score of 660 or higher.

The median income for borrowers is also on the high side at $101,000 per year. Because they tend to focus on your ability to repay the loan, and less so on your credit score, credit history is not as high a priority for them. This is great for those new to the world of credit, such as recent college graduates with a new job.

SoFi offers personal loans in most states, but if you’re a resident of Mississippi or Nevada, you are, unfortunately, out of luck.

SoFi Personal Loan Review

SoFi offers personal loans in amounts ranging from $5,000 to $100,000. A personal loan can be used for anything, such as debt consolidation, medical expenses, or for large purchases. SoFi actually recommends a personal loan from them to pay off your credit cards.

This actually makes a lot of sense since the national average APR for a credit card is over 15%.

SoFi is one of the few personal loan companies that offer variable in addition to fixed rate personal loans. The APR on a fixed rate loan from SoFi ranges from 5.49% to 14.24%. Their variable loans have a slightly lower rate than the fixed loans, but unless you’re looking for a short term loan, it’s probably best to stick with a fixed term.

SoFi also doesn’t have an origination fee, which many personal loan companies will charge you. This amount varies by lender but is usually somewhere between 1% to 5% of the total amount of the loan. An origination fee is an upfront fee charged by a financial institution to process your loan. An origination fee usually rolls into your loan or is deducted from your funds before you receive them.

Because SoFi doesn’t charge an origination fee, the total cost of the loan may be lower than many other lenders. SoFi is also free of other hidden fees often charged when getting a personal loan.

Benefits with SoFi

SoFi offers member benefits to its customers not often seen by companies of its type. For instance, SoFi offers unemployment protection and job placement assistance if you lose your job while you have a loan with SoFi. It’s a service you have to apply for and comes in three month increments with a maximum of twelve months. In that time, your payments will be suspended, though interest continues to accrue. SoFi does allow you to make payments only on the interest so it won’t compound.

SoFi also offers a career advisory group. They’ll pair you up with a career advisor to help you with career transitions, job searches, and personal branding. SoFi also hosts community events from cycling groups to financial planning seminars. They even offer seed funding and investor access through their entrepreneur program. If you do choose to get a personal loan from SoFi, it’s a great idea to take a look at and take advantage of the programs that they offer.

A SoFi personal loan review shows that they are an excellent source for a loan whether you’re paying off credit cards, consolidation debt, or need funding for any other reason. If you have an above average credit score and make over $100,000 per year, then a SoFi personal loan could be a great choice for you. They have fixed and variable personal loans, low percentage rates, and programs designed to help you succeed in life and in your career.

While a lot of companies pay lip service to the idea that you are more than your credit score, with all of the programs offered by SoFi, they really seem to stand behind the sentiment. Requesting a personal loan with SoFi is easy and getting pre-qualified won’t affect your credit. Obviously, no one personal loan company is right for everybody, but SoFi has a lot of compelling reasons to be the right one for you.

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Lauren Ward Finance Journalist

Lauren Ward is a freelance content writer focusing on personal finance, real estate, and lending.

Her work has been featured on Huffington Post, CBS News, and Kiplinger.

She previously worked at the Federal Reserve Bank of Richmond as well as several national non-profit organizations.

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