Sofi Personal Loans Review

SoFi has emerged as a leader in the personal lending space, with a particular focus on higher-income borrowers. 

Offer Best For Min. Credit Score Loan Amounts APR Range Next Steps
Best For:

Low APR for borrowers with high income

Min. Credit Score:

660

Loan Amounts:

$5k - $100k

APR Range:

5.74%-16.49%

Check Rate

The personal lending industry has grown tremendously in recent years, and SoFi has emerged as a leader thanks to its consumer-centric business model, no-fee loan products, and easy-to-use application process. Here’s a review of SoFi’s personal loan products so you can determine if it might be a good fit.

Why you can trust me

I’m a Certified Financial Planner™ and have extensive experience reviewing personal finance products and making recommendations to clients, friends, and family. In addition, I’m not just a reviewer in this case -- I’m also a SoFi personal loans customer, so I have firsthand experience with the company’s loan processes.

What is SoFi?

SoFi, which is short for “Social Finance,” is an online-based lender and financial company. In addition to personal loans, SoFi also offers student loans and mortgages, and has recently started to branch out into wealth management and life insurance products.

SoFi’s approach is unique in the sense that the company considers factors that traditionally don’t play major roles in lending decisions. For example, SoFi takes a borrower’s educational history into account when evaluating an application.

SoFi prides itself on being a personal finance community. There are community networking meet-ups from time to time, and SoFi offers some unique features related to its community-oriented nature. For example, if you lose your job while in the repayment process on a SoFi loan, the company will temporarily pause your loan payments and assist you in your search for a new job.

What do we mean by a “personal loan?”

Personal loans have surged in popularity in recent years, but still aren’t well-understood by many consumers.

In a nutshell, a personal loan requires no collateral, meaning that it is an unsecured form of borrowing, is amortized over a set amount of time, and can have a fixed or variable interest rate. Personal loans can be used for a variety of purposes and are commonly used to refinance or consolidate debt, as well as to cover personal expenses.

Personal loans are offered by a variety of financial institutions. In addition to online-based banks and peer-to-peer lenders, many traditional banks have recently entered the personal lending space. If you have solid credit and are gainfully employed, you may have noticed a surge in “pre-qualified” personal loan mailers in recent years.

SoFi’s credit standards

In order to obtain a SoFi personal loan, you’ll typically need at least a good credit score. Generally speaking, SoFi defines a “good” FICO credit score as 690 or higher, and the average SoFi borrower has a credit score of 730.

Having said that, SoFi’s loan approval isn’t just based on your current income and credit report. The company prides itself on its unique approach to underwriting, and considers factors such as the borrower’s education, professional history, and more. SoFi also assesses borrowers’ cash flow as opposed to simply looking at their debt-to-income ratio.

SoFi also favors high-income borrowers, as the average SoFi customer has a six-figure annual income. It’s worth mentioning that SoFi doesn’t allow co-signers, so you’ll need to qualify on your own merit.

Interest rates and loan terms

SoFi’s personal loan fixed rates range from a low APR of 5.74% to a high APR of 16.49%. This range includes a 0.25% discount for agreeing to AutoPay your loan through your bank account. SoFi also offers variable rate loans with slightly lower initial APRs -- a rarity among personal lenders.

Potential loan terms range from three to seven years, but the loan terms you’re offered and the APR you can get depend on your credit profile as assessed by SoFi. Generally speaking, longer loan terms come with higher APRs. Just to give one example, SoFi’s APR range for three-year loans is currently 5.99% – 14.84%, while the range for five-year loans is a substantially higher 8.65% – 16.49%.

Personal loan amounts

Here’s one area where SoFi is a big standout. Since the company aims to attract high-earning borrowers, it makes sense that SoFi offers larger loans than most competitors. SoFi’s loan amounts range from a minimum of $5,000 to a maximum of $100,000.

This is at least double the maximum loan amount most of SoFi’s competition offers. Just for some context, Marcus by Goldman Sachs and LendingClub both offer personal loans of as much as $40,000 while Upstart offers a $50,000 maximum.

Fees and other costs

SoFi has no fees whatsoever besides interest on your loan. There is no origination fee, nor does SoFi charge a pre-payment penalty or late fees. So, even if a competitor offers you a slightly lower APR, SoFi could potentially be the more economical choice. For example, Lending Club charges origination fees of as much as 6% of the loan amount.

SoFi’s application process

SoFi’s application process is about as quick and easy as you’ll find in the personal lending space. Like many other personal lenders, you can pre-qualify for a SoFi loan and check your interest rates in just minutes with no impact to your credit score. The application form is pretty simple, and any documentation requests are made in a timely manner. In all, SoFi says that the start of your loan application until the time your loan is funded should take about a week at most.

Where SoFi personal loans make the most sense

  • SoFi personal loans are excellent choices for high-income borrowers, preferably with college degrees. SoFi considers education and a strong work record as good predictors of borrowers’ future ability to pay.
  • SoFi offers higher borrowing limits than competitors. If you need to borrow more than $50,000, SoFi is likely to be your only option.
  • SoFi has no origination, pre-payment, or late fees.

When you might be better off looking elsewhere

  • If you don’t have a high income, aren’t college-educated, or aren’t well-established in your career, you may run into approval difficulties at SoFi. There is no formal requirement in place for any of these areas, but high income and a college education are typical of SoFi borrowers.
  • If you have low credit, you may have better results from another personal lender. For example, Avant offers personal loans with a minimum credit score of just 580.

Alternatives to consider

SoFi is an excellent choice for many consumers in need of personal loans, and as a SoFi personal loan customer, I can tell you that the process was relatively easy and painless. However, that doesn’t mean it’s the best choice for everyone.

As I mentioned, many companies have gotten into the personal loan business in recent years, so there’s lots of competition in the industry. And in certain situations, one of SoFi’s competitors may be the best option for you. Here are just a few of the potential examples:

  • If you have excellent credit, FreedomPlus offers interest rates as low as 4.99% on certain loans, so they may be worth a look.
  • While SoFi doesn’t necessarily require an extensive credit history, Upstart prides itself on its unconventional approach for borrowers with little to no credit history. Plus, Upstart’s minimum loan is just $1,000.
  • If you have damaged credit, Avant may be a good lender for you to check out. The company allows personal loans with credit scores as low as 580.

The bottom line is that while SoFi is an excellent personal lender for many customers, it is still a great idea to shop around. Most personal lenders will let you pre-qualify and check your rate with just a soft credit pull (won’t affect your credit score), and you might be surprised at the difference between loan terms and costs that you get offered from different institutions. So, don’t take out a personal loan before you’ve explored your options from at least a few of the best personal lenders.