SoFi Student Loans, the student-loan brand of Social Finance, based in San Francisco, is a major player among student loan refinancing companies. SoFi Financial is particularly well-known for its 2011 innovation: refinancing federal and private student loans together, in one bundle. The company offers student loan refinancing as well as mortgages, personal loans and parent loans for education assistance.
SoFi’s student loan refinancing
SoFi Financial has refinanced over $5 billion in student loans as it has become the biggest lender in the market. As part of its refinancing business, SoFi considers its borrowers to be “members” and provides resources to former students now looking for jobs. As part of this initiative, SoFi offers networking events and career coaching to borrowers in its refinancing program.
Key Loan Terms
SoFi offers fixed rates of 3.38% to 6.74% APR and variable rates that range from 2.62% to 6.54% APR.
Loan terms are flexible and can be set for 5, 7, 10, 15 or 20 year repayment periods.
Balances eligible for refinancing range from $5,000 and up, to the full balance of a student loan.
More Loan Details
With a SoFi refinancing loan, there are no pre-payment or origination fees for making the loan or paying early. The loan is serviced by MOHELA. Over the life of the loan, there are up to 12 months of forbearance available; these forbearance periods are handled in three-month segments. Loan deferment is available for people who return to graduate school at half-time or more, serve actively in the military or go through rehabilitation for a disability.
Qualifying for a SoFi loan
In order to qualify for student loan refinancing from SoFi Financial, you will need to meet a few qualifications. These include:
Employment – you must be employed, have a job offer that starts within 90 days or show other sources of sufficient income.
Student loan standing – you must be in good standing on your student loans and not in default in order to qualify.
Credit score – you must have a minimum credit score of 650 to be approved for SoFi refinancing. The average borrower with SoFi has a credit score of 720.
Education – as SoFi is a student loan refinancer, you must have a bachelor’s degree or higher.
Income – There is no minimum income qualification beyond showing sufficient monthly cash flow to repay your loans, but the average SoFi borrower has an approximate annual income of $130,000.
Pros and Cons of SoFi student loan refinancing
There are some real benefits to refinancing your student loans through SoFi. The unique career support perks that come with the refinancing include one-on-one career coach meetings, resume coaching and resume advice. For those who are interested in launching their own start-ups, six-month deferments are available for those accepted into the Entrepreneur Program, which also offers connection with potential supporters, investors or mentors for a new business.
In addition, SoFi is one of several refinance lenders that allows PLUS loans issued in the name of a student’s parent to be bundled into the child’s refinance package. This allows now-graduated children to carry the loan debt instead of the parent.
However, unlike other student loan refinancing programs, SoFi loans are not available in Nevada. If you apply to SoFi with a co-signer, the co-signer cannot be discharged from the loan without a new refinance. Some other programs do allow co-signers to be released after a certain period of on-time payments from the primary borrower. This is because a number of new college graduates apply for refinancing with a co-signer before they launch their careers, including parents or guardians.
Choosing a SoFi loan
It makes sense to compare the lenders available for student loan refinancing in order to ensure that you choose the lender that best meets your needs and offers the lowest rate available. Some lenders offer more protections than others, and it is important to review these as well.
SoFi’s online preapproval process is a soft credit pull that won’t affect your credit score and offers a rate estimate if you borrow a student loan from SoFi. The full application before actually taking out a refinancing loan is a hard credit pull.
In order to borrow the loan, you will need certain identity and verification documents as part of your application. These documents include:
Identification documents, such as a driver’s license, passport or other government-issued photo ID, and
Student loan billing statements indicating your payment status and balance, and
Income documents, such as your pay stubs or tax returns.
Overall look at SoFi loans
The lender also offers student loans for the parents of current college and university students. These loans enable parents to support their children’s education when funds are short. SoFi’s rates tend to be lower than some other major private lenders as well as the federal government’s parent PLUS loan rates, without origination fees. In addition to their refinancing business for college graduates, parents looking into how to help their children obtain a college education would be well-served to examine SoFi’s private loan options.
For college graduates, SoFi is one of the more dynamic and modern student loan refinancers. It offers future discounts on other loans – and since SoFi offers personal loans and mortgages, this is a service that may be of use to student loan borrowers.