About SoFi

SoFi is a marketplace lender that claims to help you refinance your federal and private student loans, while saving you around $14K in the process. In addition to student loans, SoFi also offers mortgage refinancing, new mortgages, personal and parent loans, as well as MBA loans.

Compared to the competition, SoFi claims to offer lower rates and more flexible terms, as well as career support, unemployment protection, and entrepreneur programs. Because of this, the company claims to have funded over $3 billion in loans to date.

Whatever kind of loan you’re thinking about taking out, is SoFi your best bet? Are there any important considerations to keep in mind? Let’s find out.

What is a Marketplace Lender? What Are the Advantages & Disadvantages?

Marketplace lending (also known as peer-to-peer lending) “is the practice of lending money to unrelated individuals, or "peers", without going through a traditional financial intermediary such as a bank or other traditional financial institution.” In other words, instead of obtaining a loan through your bank, which is funded by deposits, share equity, debt, and more, marketplace lenders use money from direct investors.

As a result, there are several advantages with peer-to-peer lenders, including less stringent underwriting criteria (and a more diverse range of loan products), faster approval times, less paperwork, and generally lower interest rates.

On the other hand, some drawbacks related to marketplace lenders include higher monthly payments (despite lower interest rates) and higher credit scores to qualify.

Also, if you’re refinancing a student loan (regardless of whether it’s through SoFi or another company), keep in mind that your federal loans come with some special benefits, including public service forgiveness and economic hardship programs, which might be lost once you’ve refinanced.

With this in mind, do you have any other choices when it comes to peer-to-peer lending?

Other Marketplace Lending Options

Although peer-to-peer lending represented a small segment of the market only a few short years ago, due to market need, they’ve started popping up all over the place ever since.

Because of this, it’s important to research all your options before making a decision (HighYa is a great place to start!), including Prosper.com, LendingClub.com, Upstart, and many others. To see just how many choices you have, try typing the phrase “marketplace lending” or “peer-to-peer lending” into your favorite search engine.

Granted, not of all these will provide the same lending options as SoFi, and not all will come with the same online customer reputation.

Speaking of which, what are SoFi’s customers saying?

Customer Feedback for SoFi

SoFi was founded in 2011 by a group of Stanford Graduate School of Business (GSB) students, so they’ve been around long enough to garner hundreds of online reviews.

SoFi was also named a CNBC Disruptor 50 for 2015, and has been featured in numerous national publications, including The NY Times, Inc., The Huffington Post, Reuters, Bloomberg, and more.

On CreditKarma, SoFi customers gave the company an average rating of 4 stars, with common compliments citing ease of use, fast responses, and reduced interest rates. On the other hand, common complaints cited long/difficult application processes, unresponsive customer service, and comparatively high interest rates.

StudentLoanSherpa.com gave SoFi a rating of 8.8 stars, an complimented their interest rates non-existent origination, application, and prepayment fees. However, they also noted that qualifying for a SoFi loan might be more difficult than other options, considering the company’s high income requirements.

On Yelp, SoFi had an average star rating of 1.5, with some customers claiming to have been happy with their experience, although many more were frustrated by long applications with repeated requests for the same documentation (only to be denied), and poor customer service.

From a company perspective, SoFi Lending Corp is based out of San Francisco, CA, and had an A- rating with the Better Business Bureau based on 18 closed complaints (as of 7/31/15). There, complaints seem to mirror those found elsewhere online.

SoFi Pricing, Fees, & Eligibility

Applying for a SoFi loan is free, and even once you’re approved, comes with zero application fees. After an initial pre-approval (before you even finish the application), you’ll simply have to select the loan that’s right for you, and upload and sign your documents.

At the time of our research, SoFi’s fixed rate loans started at 3.5% APR, while variable rates started at 1.9% APR. There was also a 0.25% interest rate reduction if you choose automatic bank account deductions.

Note: SoFi loans are not available in Nevada, and some programs may be limited in Tennessee and Ohio.

According to SoFi, their underwriting process takes a number of dimensions into consideration, including professional accomplishments, income, and education, and obviously credit rating and employment history. However, keep in mind that the minimum loan amount is $10,000.

On top of this, you must either currently have a job or an offer of employment to begin within the next 90 days. You must also have graduated from a Title IV accredited university or graduate program. For full details, be sure to read through SoFi’s Eligibility Criteria.

Because SoFi is a marketplace lender, the company also gives accredited investors the opportunity to invest in structured products that provide “targeted rates of return.”

Regardless if you’re thinking about taking out a loan or investing in one, SoFi’s live customer support can be reached 7 days a week at 855-456-7634.

Can SoFi Really Help You Save $14K?

While saving $14K over the course of your student loan repayment might sound like a no-brainer, according to SoFi’s Legal section, this is based on a $100K loan with an average APR of 6.77%

As a result, if you owe less than this on your student debt or have a lower interest rate, this might not necessarily apply to you.

Is SoFi the Right Lending Solution for You?

Because qualifying for a loan is such an individualized process, like any other lender (whether a bank or a peer-to-peer network like SoFi), what works for you may not be ideal for someone else.

However, SoFi’s career support, unemployment protection, and entrepreneur programs, as well their investor program, are different from much of the competition, and indicates that they’re focused on providing the best possible experience for their customers. On top of this, SoFi appears to have a very positive online reputation with their clients.

Considering all of this, SoFi seems to be a solid option if you’re looking for a student loan or mortgage, or are looking to become an investor. Just be sure to explore all your options beforehand!

What’s your experience with SoFi? Tell us about it by writing a review below!

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5 Customer Reviews for SoFi

Average Customer Rating: 1.8
Rating Snapshot:
5 stars: 1 4 stars: 0 3 stars: 0 2 stars: 0 1 stars: 4
Showing 1-5 of 5
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  • 1 out 1 people found this review helpful

    Credit Inquiry without permission

    I simply called and asked for more information. They were supposed to send an email explaining their program. It didn't happen. Next, I get an email, a turndown letter. I never applied nor gave permission nor my social security number or any of my personal info. They overstepped in my opinion and performed an action I never agreed to.

    Bottom Line: No, I would not recommend this to a friend

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  • 6 out 7 people found this review helpful

    No different than any other lender

    I called SoFi because I saw the CEO on CNBC. What a joke. Nothing she said was representative of the way I way treated: Call not returned; person I spoke to was like an automaton; nothing I was told was anything close to new or different from the normal rip off that other mortgage brokers handout. I wonder if the rich in this country understand that people lost homes in 2008 and that some people who stuck it out are now suffering from draconian mortgage rules and have no where to turn! Don't waste your time.

    Bottom Line: No, I would not recommend this to a friend

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  • 5 out 6 people found this review helpful

    Ads lie about benefits of federal protection

    • San Francisco,
    • May 10, 2016

    Be careful about this company. They say that if you lose your job, they will pause your payments, but if you find another job that pays less than your last one, they will not lower your monthly payments or extend the term of your loan. So when they say: "But if your income is over a certain threshold, you won’t benefit from these programs," they are lying to you.

    Bottom Line: No, I would not recommend this to a friend

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  • 11 out 11 people found this review helpful

    Poor service, no communication, lack of responsiveness

    • Arlington, VA,
    • Apr 1, 2016

    We decided to give SoFi a shot at providing us a personal loan. Our credit is excellent. After the initial paperwork, SoFi promised a 5% loan, but after the paperwork was done, it shot up to 7.5% with no explanation. After the loan was approved, we were promised the funds would be available within 7-10 business days. Based on that promise, we signed the paperwork. The day before the loan was due to be paid, we went onto out account webpage and found out that the payout was extended to 30 days. SoFi didn't bother informing us regarding this change as well.

    We sent them an email complaining about the change. Someone named "John" from SoFi called back and left a message, stating that there was a policy change across the board. We called SoFi back, and the drone on the other end kept repeating that there was a policy change, and that we would get the money within 30 days. When we asked to speak to someone else, they replied back "why, they are just going to tell you the same thing." This was very unprofessional, and left us feeling lied to and cheated by SoFi. Steer clear of this organization!

    Bottom Line: No, I would not recommend this to a friend

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  • 7 out 14 people found this review helpful

    Good Refinancing Option With Sofi

    • Atlanta, GA,
    • Jan 6, 2016

    The SoFi rates are competitive. The online process is easy and you can get pre-qualified without impacting your score. I got approved in a day or so for a personal loan. However, student loans can be refinanced too. Unlike other refinancing options, this one also offers a freeze on commitments in the event you lose your income. This is reassuring. It's worth looking into, to reduce interest charges and possibly help to improve your score along the way. This is particularly encouraging as credit card rates are going to be on the upswing going forward.

    Bottom Line: Yes, I would recommend this to a friend

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