When it comes to student loan refinancing, no lender is bigger than Social Finance, also known as SoFi. Since launching, SoFi has refinanced over $3-billion in student loans. Even more, there is nothing to suggest they are slowing down any time soon!
Yet a lot of borrowers may not know that SoFi doesn’t only offer student loan refinancing. In the last few years, Social Finance has expanded into other arenas, such as mortgages and personal loans. They also offer exclusive perks that other lenders can’t.
So, what’s the verdict on Social Finance? Here at Bonsai, we’ve taken a look at the company, and we’re excited to report back to you what we’ve found.
Social Finance began in 2011 as a small $2-million student loan program at Stanford University. Founded by a group of ex-bankers who wanted a way to use personal finance for social benefit, they set out to offer a more affordable option to traditional student lending.
Within four years, Social Finance was one of the top-30 U.S. banks, valued at approximately $4-billion. This places them as among the most valuable financial-technology firms in the world.
SoFi may be new to personal lending, but they have established themselves as among the best. Our experiences with their products have been very positive.
One of the biggest positives that SoFi offer are their interest rates. Regardless what you’re looking to use your loan for, SoFi has an interest rate that can help you. Their rates start at 5.37%, which is low when you consider that other firms offer interest rates between 4% and 25%!
Another positive to Social Finance and their personal loans is that they are unsecured loans. Loans like auto loans or mortgages are backed by the car or house it is funding. But with an unsecured loan like SoFi offer, you don’t need collateral to qualify. And more than that, these loans are offered in balances as high as $100,000!
You may be thinking to yourself “I can’t qualify for a $100,000 loan. My credit isn’t the greatest…” Well, let me tell you another positive to the SoFi process.
SoFi doesn’t make their determinations based on only credit! They also consider things like your professional experience and your income levels. But, if you think or know that you have bad credit, you may be better suited exploring some other options.
One of the things that we love about Social Finance is that they don’t charge fees for processing personal loans. That means no origination fees either, and much fewer penalties than other firms.
And did we mention their customer service? How many times have you called a financial institution and you feel like you’re hearing a script? Or it feels like the representative isn’t even listening to you? And when you hang up, you don’t even know that they helped you at all?
Well, during all the times we’ve dealt with SoFi, we have never experienced that. In fact, we’ve found SoFi’s customer service to be nothing less than excellent.
Representatives are standing by seven days a week to help you navigate any issues you may run into as you request financing.
You may be thinking “with all these positives, there has to be a catch,” right? Well, in our experiences dealing with SoFi, we have yet to have a negative experience.
That said, we have heard from borrowers about more negative experiences with SoFi.
Remember when we told you that SoFi doesn’t make their determinations based entirely on your credit? Well, that can be a good thing if your credit isn’t your strongest suit, but it can be a bad thing too for some people.
We’ve heard from applicants who were denied because of the number of hard inquiries on their credit report. Others have reported that their denial was due to their debt-to-income level being too low.
Now, we both know that those are factors that should be considered when you request personal loan financing. But should they be the only factor in determining if your request form should be rejected? In this case, that’s up to SoFi to decide.
Others have told us that the request process can be tedious. For some, this means issues verifying income. That could be due to overtime pay, pay dates, or other factors). For others, they have had to resubmit the same form due to processing errors.
Another common complaint comes from individuals who received a “pre-approval” mailer. They complete the request form, submit all the necessary paperwork, and then receive a ‘denial’ letter down the line.
“Why was I pre-approved for a loan,” they may think, “if I’m denied when I submit a request form?”
What a lot of borrowers don’t know is that these pre-approval mailers are based only on a “soft credit” inquiry. When a firm runs a soft credit inquiry, they are mainly only receiving your credit score. But when you later submit a request form and allow a hard credit inquiry, they may find more factors that influence their decision.
As a personal finance firm, we can understand how these issues would be frustrating to a customer. Yet, as we ourselves have never run into them, we feel issues like this are few and far between.
When everything is said and done, our experiences with SoFi have been nothing short of excellent.
As we said before, there are several negatives that have been reported to us about SoFi, but we have never personally come across the issues that have been listed. That’s not to say that they aren’t happening, but just that they may not be as frequent as you may otherwise assume.
We recommend SoFi to our clients who come to us looking for personal loans, especially if we think that they may be suitable candidates for the company’s loans.
If you have any further questions about SoFi or feel you’re ready to request financing for a personal loan, contact us today and we’ll be more than happy to help you.