SoFi specializes in student loan refinancing and has seen substantial growth since the company was founded in 2011. The lender has funded $30 billion in loans and has half a million customers. With extensive refinancing options and extra career perks, this lender is worth considering if you meet their requirements.
Student Loan Refinancing Application Requirements
First and foremost, you must be U.S. citizen, resident, or visa holder in order to qualify for student loan refinancing through SoFi. You also must have attended a program from an eligible, accredited Title IV school and graduated with at least an associate’s degree.
The minimum loan amount for student loan refinancing is $5,000 which can be a combination of both federal and private loans. Residents of all 50 states and the District of Columbia are eligible to apply.
You must have consistent income in the form of employment or other sources to qualify for refinancing. Alternatively, you can qualify if you have a job offer that starts within 90 days. While there’s no minimum income requirement, typical borrowers earn at least $100,000 annually. Your credit score should be at least a 650 but the average is 700.
If you have a bankruptcy on your credit report, you’ll have to wait until it drops off before you can apply for a SoFi student loan refinance. The amount of time this takes to happen will vary depending on which type of bankruptcy you filed. For a Chapter 13 bankruptcy, you will need to wait at least seven years; for a Chapter 7 bankruptcy, you will need to wait a total of ten years.
Types of Student Loans Available
There are a few different options for refinancing your student loans through SoFi. Let’s take a quick look at each one.
Student Loan Refinancing
SoFi refinancing is available for a wide range of student loan types, including unsubsidized Direct Loans, Graduate PLUS loans, and private loans. The lender does note that even though you may get a better rate refinancing federal loans, you do lose certain benefits like public service forgiveness and economic hardship opportunities. Be sure to weigh these pros and cons before making a decision on your federal student loans.
If you do have multiple types of student loans, SoFi allows you to consolidate them into one single loan at the same rate. SoFi offers loans with both fixed and variable rates so you can choose the best option for your specific situation.
Parent PLUS Refinancing
Parents with balances on Parent PLUS federal loans or qualified private education loans can also apply to refinance to see if they can receive better terms and rates. The application process and eligibility requirements mirror those for regular student loan refinancing. You also have the option for fixed or variable rates.
Medical/Dental Resident Refinancing
Medical and dental resident refinancing is available in all states except Mississippi and Montana. You can qualify if you have up to four years left in your program and you must carry at least $10,000 in federal or private student loan debt. The minimum loan amount may be higher in certain states.
You should also be a graduate with an MD, DO, DMD, or DDS from a Title IV accredited university or graduate program.
Fees and Rates
- SoFi doesn’t charge any application or origination fee when you apply for student loan refinancing.
- SoFi’s rates can be extremely competitive if your credit score is considered good. The rate you’re offered depends on many factors, some of which include your current financial situation (meaning your current DTI and monthly gross income), as well as your credit history and score.
- If you sign you for autopay, you’ll receive a discount of 0.25%.
- SoFi does charge late fees. Once your loan is 15 days past the payment date, Sofi charges you $5. This is a relatively low fee compared to other lenders. Just remember that it happens after 15 days and not 30 days. This is normal, but many people assume they have 30 days because that’s when a delinquent payment is reported to the three credit bureaus.
SoFi’s Student Loan Refinancing Process
Refinancing with SoFi starts off with a soft pull so your credit isn’t hurt. You can see your rates and terms to decide whether or not you want to proceed with your student loan refinancing process. If you decide you like what you see, start gathering everything you’ll need to begin the process in earnest.
- Paystub or income verification (must be within the last 30 days or less)
- ID (birth certificate, certificate of citizenship, certificate of nationalization, driver’s license, military ID, US Passport, or social security card)
- Loan statement
- Proof of address (bank statement, credit card bill, utility bill)
Next, you’ll need your 10-day payoff number. SoFi will need to know the exact payoff amount so it can pay off your existing loan balance.
Fixed Rate vs. Variable Rate Student Loan
Lastly, you’ll need to decide whether you want to refinance with a fixed rate loan or variable rate loan.
A fixed rate loan has an interest rate that doesn’t change over the life of the loan. This means that your first payment will be the same as your last. This is preferable to people who like knowing exactly how much they need to set aside each month to cover their payments.
A variable rate loan means that the interest rate will change over the life of the loan, causing your payment amounts to fluctuate. For SoFi loans, the rate may change monthly, so each payment could be different. The good news is that the rate is capped at either 8.95% or 9.95%, depending on the length of the loan term you choose.
If you’re not a fan of surprises, choose a fixed rate. If you want to take advantage of possible savings, then choose the variable. If your finances can handle SoFi’s max rate of 8.95% or 9.95% or you plan on paying off your student loan debt quickly, you might consider choosing a variable rate loan.
Deferment Options – SoFi offers loan deferment options if you go back to graduate school at least half-time, enter disability rehabilitation, or enter into active military duty. At the end of your deferment period, your loan balance is re-amortized over the remaining loan term. To initiate deferment any of those reasons, you must first sign a loan deferment request form, as well as submit any requested documentation.
Unemployment Protection – If you lose your job through no fault of your own, SoFi offers an unemployment protection program. If you qualify, SoFi puts your loans into forbearance. Loan forbearance allows you to stop making payments on your loan for a period of time, but the drawback is that interest will continue to accrue. If you choose, you can make interest-only payments while your loan is forbearance so your total loan balance does not increase.
SoFi offers loan forbearance in three-month increments and caps it out at 12 months. You only have 12 months for the entire life of the loan, so if you lose your job again in the future and you’ve already used 12 months, you won’t be able to use it again.
Rate Discount for New Loans – SoFi is unique in that realizes it’s easier to keep an existing customer than get a new one. Perhaps that’s why they offer a 0.125% rate discount on other loans for current members interested in additional financing.
Even if you have completely paid off your original loan, you’re eligible to receive the discounted rate. Whether it’s a personal loan or mortgage, the discounted rate applies to all of SoFi’s loan products.
Career Counseling – If needed, another unique feature about SoFi is that you can discuss your career with a career coach. The coaching is one-on-one, and you can discuss any career-related topics during a session. Your coach will ask you sets of guided questions to determine if you’re in the right line of work and what you consider to be a success.
Many members discuss career changes with their coach, how to negotiate and network, and personal branding. It doesn’t matter what level you’re on in your career path. Top or bottom, your career coach can help you take the next step forward.
Referral Bonus – Refer a friend to SoFi and both you and your friend will get some extra money: $300 for you and $100 for your friend.
Financial Advising – As a SoFi member, you’ll also get complimentary financial advising to help meet your future goals. They also waive any fees if you choose to invest with SoFi Wealth.
SoFi is a top-notch online lender that doesn’t just offer student loan refinancing. It also offers a plethora of personal loans and mortgage loans. Surprisingly, it’s more of a community than convenience.
They routinely hold networking parties, offer career counseling, and give financial advice. It’s little wonder why many of its clients are recommended to SoFi by previous clients. With a 98% approval rating and additional discounts on future loans, SoFi is well on its way to becoming an internationally known lender.