With the current rise in cryptocurrency, There has been an equivalent rise with online lenders. These types of companies are popping up all over the internet, however, SoFi is most likely the most popular online lender on the market right now.
SoFi owes most of its success and popularity to its student loan refinancing program.
Founded in 2011 as Social Finance Inc by Stanford Business school students using an alumni-funded lending model. In May of 2012, SoFi introduced student loan refinancing becoming the first company to refinance federal and private student loans.
It was this service that truly propelled SoFi into the massive company it is today. In 2015 SoFi began offering personal loans and became a million-member company in January of 2020.
What Does SoFi Offer?
SoFi’s self-proclaimed mission is to help people reach their financial Independence and to realize their ambitions. They specify that financial independence doesn't just mean becoming rich means getting to a point where money begins working for you to improve your quality of life.
Since its inception, SoFi has evolved to offer a variety of services including, Lending, Investing, Credit, and Insurance services. These services are catered to people with a minimum credit score of at least 680.
Lending
As mentioned before SoFi’s success is largely owed to their student refinancing program and their private and personal loans. SoFi offers three different loaning services; Student Loan Refinancing, Private Student Loans, and Personal Loans.
Student Loan Refinancing
Refinancing your student loan is a great solution for working graduates who have high interest, unsubsidized Direct Loans, graduate loans, or private loans.
It is important to note that federal loans do carry some special benefits with them such as public service forgiveness and economic hardship programs that might not be accessible if you refinance using SoFi services.
SoFi Will consolidate all qualified Education Loans into one simple figure to deal with. When refinancing you can choose from low fixed rates or variable rates.
Fixed rates start as low as 2.99% and go up to 6.64% APR and variable rates start as low as 2.25% up to 6.39% APR with both fixed and variable rates requiring auto-pay.
Eligible candidates are going to require a fairly high credit score of 680, and must have graduated from a selection of title IV accredited universities or graduate programs.
Additional conditions apply such as having sufficient income, employment, job offers, start dates and financial history.
Private Student Loan
With 98% of surveyed members recommending SoFi to a friend, the private student loan service is one of the top student loans available in the country.
SoFi Private student loans launched in 2019 with a goal to create private student loan products that help students pay for school easily and without stress because we all know students have plenty of that.
These types of private student loans are best used when you have exhausted all your options for federal grants and loans as those come with certain benefits that private loans do not carry.
SoFi private student loans can cover up to 100% of the school-certified cost of attendance which includes things such as tuition, food, books, supplies, room and board transportation, and personal expenses.
There are zero fees associated with this private student loan, which means no late fee, no origination fees, no application fees, and no insufficient funds fees.
“No Fees” is a wonderful sound to the ears of any student, and SoFi also delivers special parent loans that help those parents that are helping their child pay off tuition.
The minimum amount that can be borrowed is $5,000 and a 0.25% APR discount is earned with auto-pay signup.
Personal Loans
This personal loan is money you can borrow for any kind of personal use such as paying off your credit card debt, investing, taking a special vacation, paying for an engagement ring, or any other such expenses.
Taking out a personal loan can be a smart way to consolidate high-interest rate balances under 1 monthly rate. The SoFi personal loan is perfect for those who want the flexibility to make a very large purchase and then pay it off at a pace that is reasonable to you.
SoFi Personal loans or unsecured, meaning that you do not need to provide any collateral for the loan. The minimum loan amount is $5,000 up to a maximum of $100,000.
Similar to student loans, these private loans have no fees and terms ranging from 2 to 7 years with the added benefit of unemployment protection. The interest APR range is at a fixed rate from 5.99% to 18.85% based on specific criteria.
Eligibility for SoFi personal loans requires you to be a US citizen, permanent resident, or VISA holder, 18 years of age or older, and reside in an eligible state.
Additional factors affect your eligibility for a personal loan such as your financial history, credit score, and monthly income versus expenses.
Investing
In 2019 SoFi launched the SoFi Invest platform which allows you to trade stocks, ETFs, Cryptos, and participate in upcoming IPOs through an all-in-one trading hub. SoFi Offers a sign-up bonus when downloading the app and the user can receive up to $1,000 when opening a new account.
SoFi offers automated investing portfolios or you can do it yourself by choosing your own investment strategies. the minimum amount for investing is $5 and there are no commissions for any trades.
Additionally, for the investors with less capital, SoFi offers partial shares so that you can participate in the trading of larger companies.
SoFi has a nifty little investment calculator right on their webpage that will help you do some quick calculations and set some rough objectives.
The calculations give you a good idea of what your money would look like at a theoretical rate of return of your choice for up to 50 years.
Spending
Credit Card
SoFi Offers a credit card that is designed to help you save, invest and pay down a loan that you have taken out using SoFi services.
The credit card offers 2% unlimited cashback on all purchases with no annual fees. The catch is that the 2% cashback earned is redeemed directly into cryptocurrency using your SoFi active investment account.
Some will see this as a negative however with cryptocurrency gaining popularity this could be a great way to also diversify your portfolio a little bit.
Sofi offers an on-time bonus as well which means making 12 on-time payments will lower your APR by 1%.
SoFi Money
SoFi also offers a debit Mastercard, which comes with some really great benefits. There are no account fees and no monthly fees of any kind to pay.
Overdraft is free up to $50 once direct deposits have been made. Once again with the setup of some direct deposits all the money in your account will be able to earn 0.25% API which is 6 times the national interest rates over other spending accounts. SoFi’s partnerships allow you to access 55,000 fee-free ATMs across the country.
Any money deposited into your account is instantly insured up to 1.5 million dollars through the FDIC.
There is also a 15% cashback reward on everyday expenses when you pay using SoFi Money. All these services and more can be accessed over your phone through the SoFi Money app.
SoFi Relay
Relay is a tracking app that helps you keep track of all your money in one simple place. Getting your credit score, your spending breakdowns, and more financial Insights come at no cost through the SoFi relay service.
Disservice will help you hit your financial goals by helping you see the bigger picture by connecting all of your accounts into one mobile dashboard.
Doing so allows you to have everything organized in one place Allowing you to see more than you would individually and set better more realistic goals and expectations.
Using this service will not affect your credit score in any way as SoFi uses a “soft” pull on your credit which does not affect the score.
Relay Services are powered by TransUnion which is one of the three major national credit reporting companies.
Insurance
Sofi has partnered with multiple companies to provide some of the best insurance in the industry across all categories. Partners include Ladder, Gabi, and Lemonade offering Life, Auto, and Home/Renter’s Insurance respectively.
SoFi Offer is life insurance through Ladder coverage that can be easily increase decreased with no fees and no hassles. the flexible coverage Rangers from plans as low as 100K to up to 10 million on terms up to 30 years which can be adjusted anytime.
The application process can be done in several minutes. Medical tests are not required for eligible applicants.
Additionally, SoFi offers estate planning services that help you draft your personal will, which is a free service for all SoFi members.
Auto Insurance by SoFi is offered through Gabi which is a service that provides a true comparison of insurance companies.
A so-called apples-to-apples comparison against your existing policy to find a better deal for you.
Shopping for any insurance policy is a hassle, Gabi allows you to save time and pull up new quotes in minutes as well as giving you the peace of mind to make sure you've compared all your choices from the network of providers that Gabi is partnered with.
SoFi Offers home insurance through Lemonade, with plans starting from as low as $25 a month.
The AI that is lemonade’s bot, Maya, handles all of the back-and-forth paperwork between you and your lender letting you go on about your day without any worries.
Lemonade is an a-rated exceptional, fully licensed insurer and is reinsured by some of the most trusted names on the planet
The renter’s insurance is even quicker with Lemonade boasting about getting a policy in as few as 90 seconds.
Once again Lemonade's AI Bots, Maya, will ask you a few questions and offer a matching insurance plan starting as low as $5 a month.
Final Word
SoFi Is one of the titans of the online lending industry with an approval rating from users that is the envy of any company.
SoFi largely earned this status to it's more than fair rates and 0 fees on the majority of their loans.
No origination, late payment, or fees of any kind make dealing with this financial service a much more pleasurable experience.
Repayment terms range from 2 to 7 years which is a larger range than most online lenders offer. More options mean more customization and prioritization for yourself and your interests.
Additionally, the added benefit of unemployment protection will put your loan into forbearance and suspend your monthly payments if your job loss was through no fault of your own.
SoFi also offers free career and financial advising through one-on-one career coaching that helps with Job searches, career Transitions and personal brand.
Members receive free financial advising from a certified financial planner who can help them build a budget, create an investment strategy and choose insurance and save for the few.
With services like this, it's no wonder SoFi is often the most recommended Lending Service available and I highly recommend it for anybody looking to refinance their student loans or take out personal loans.
