“Great loans for great people.”
What a friendly, likeable slogan! The marketing department over at SoFi had the right idea – this slogan makes you feel like you can just sit down and chat with a loan officer over a cup of coffee, that a smiling face will help you acquire a loan to solve all your financial problems.
But what is SoFi? Obviously they offer financial products, but what makes the company different to others? Read this SoFi review and find out everything you need to know about the company.
What is SoFi?
All things considered, SoFi is a pretty new company. It was founded in 2011 by a handful of Stanford Graduate School of Business students. As you can imagine, these young men were a bit overwhelmed by the cost of college and sought to find a new way for students to fund their education.
After the initial launch of the educational loan product, the young men decided to expand the offerings of the company. Today, SoFi offers personal loans, student loan refinancing, mortgages and more, and at relatively low interest rates.
So What Makes SoFi Different?
SoFi is short for Social Financing. It’s an American company, based in Utah, and does not have any brick and mortar locations. The company claims this helps them keep costs down. Furthermore, the company is selective in its approval process. They say they don’t focus on credit score, but instead treat borrowers like individuals.
How does all this work, and what does it mean for you? We were curious about the company, so we did a little research about the loans themselves for our SoFi review. Here’s what we found out.
SoFi Review: The Pros
SoFi is, in a way, a different kind of loan company. The lender isn’t a traditional bank and, as mentioned, it claims not to focus on borrowers’ credit scores. That means you can qualify for a loan between $5,000 and $100,000 with an interest rate as low as 6%. Mortgages are not traditional, either. Borrowers may qualify for a loan with as little as 10% down.
As we researched this SoFi review, we paid particular attention to the customer service reviews. For the most part, borrowers and applicants were very pleased with the way their calls were handled. Unlike traditional banks, the customer care lines are open seven days each week and customers said the call center reps were friendly and knowledgeable.
You can use SoFi loans for just about anything. In fact, when you apply for the loan you can choose from credit card payoff, medical expenses and more – even engagement ring purchase. In other words, the loans aren’t as restrictive as some other personal loans.
This is an unsecured loan – you won’t need collateral, and the monthly payments were reported to be low in the SoFi reviews we accessed. This is in part because of the low interest rates, and in part because your loan can be paid off in as many as seven years.
Overall, if you qualify for a SoFi loan, we think you’ll be impressed with both the customer service and the terms of the loan. That said, there are some cons to the SoFi loan program. Let’s take a look.
SoFi Review: The Cons
We’ll just be upfront about the cons of our SoFi review: it’s not a product for everyone. We’ve mentioned a few times that the service doesn’t qualify you based on your credit score. Or, rather, they claim not to. However, the company will do a soft pull on your credit to decide whether you qualify.
If your credit (as determined by this soft pull) is lower than 680, you won’t qualify. If your income is low, it’s not likely you’ll be able to get a loan. The average credit score of those who qualify for SoFi loans is at least 700 and the average income is over $100,000.
Let’s put that another way. If you’ve recently graduated medical or law school and are just beginning your career, SoFi might be a good bet for you. There’s a marginal chance your income will meet the requirements. And if you’ve been careful, your credit will qualify too.
If you’re graduating college with a degree in English and have secured an entry level job at a newspaper, you may not be so fortunate. Your income will likely be too low and your credit score may impact your “creditworthiness” as well.
There’s one more thing we feel the need to mention in our SoFi review. If you haven’t graduated from an accredited university, you’re automatically ineligible. Many would-be borrowers thought this to be quite elitist. As you’re likely aware, it’s very possible to be creditworthy without a college degree. We think Richard Branson would agree.
While the SoFi financial products may be a good fit for those who have good credit, people who have chosen a non-tradition career path are, unfortunately unable to join the “club.”
SoFi Reviews Summary
We really want to like SoFi. The concept of a lender that doesn’t take FICO score into account is genius. Unfortunately, we feel as if this is a claim the company makes but doesn’t adhere to. Consumers who qualify for the personal loans all have good-to-perfect credit, and we feel this negates the claim that borrowers are treated as individuals.
If you do have perfect credit and a college degree, there’s no harm in seeing what kind of rate SoFi can offer you. You can use the money for anything you like, whether it’s consolidating student loans or buying a new car. There are no restrictions and the repayment terms are comparable to or better than loans through your bank.
In short, SoFi isn’t right for everyone. You may get a good rate through the company but you can get a similar one through peer to peer lending, with less stringent qualification requirements.
If you’re curious about whether you qualify, visit the SoFi website. After supplying just a bit of information you can see whether you can access SoFi services, or whether you should look elsewhere for a personal loan.