Refinance Student Loans 2024 Unlock Savings: How Refinancing Your Student Loans with Sofi Could Save You Thousands

 

In this video, I'm reviewing Sofi as a way to refinance to pay off student loans fast and save money.

What is Refinancing? When you refinance a loan, you basically get a better loan agreement with lower rates or easier terms. It depends on what you need, but refinancing not only protects your credit rating but also keeps you from missing payments by switching to lower monthly payments.

Why Refinance Student Loans? Okay, so there are a lot of good reasons to refinance student loans, but it's not for everyone. First of all, you need a good credit rating to get the best deals. If you refinance a federal student loan with a private lender, you forfeit benefits like federal debt forgiveness programs. So, you need to see what any private refinancer offers to protect you in difficult situations.

What We'll Cover: In this video, I'll be going into some details about:

• What Sofi Offers for Student Loan Refinancing
• How It Works
• Who It Might Work Best For
• Other Costs Involved
• Pros and Cons of Refinancing with Sofi

So you can figure out if it's the best refinancing option for you or not. If you find this review interesting or helpful, you can show your appreciation by liking this video and subscribing to the channel if you haven't already to see more of my honest reviews.

Affiliate Disclosure: Just to be upfront, I'm an affiliate of pretty much all the companies that I talk about, including Sofi. But my recommendation wouldn't mean much if I didn't give you my honest opinion, as always. If at any point you decide to refinance with Sofi, check out the affiliate link down in the description. It doesn't cost you anything, and you might even get a bit of a discount, which you wouldn't get if you went directly to their website.

What is Sofi? Okay, so if somehow you got to this video and you’ve never heard of Sofi, they’re basically an established online lender that refinances student loans and also offers private student loans to graduates, undergraduates, and their parents. When it comes to refinancing, Sofi has specialized options for medical, dental, law, or MBA graduates and parents. You can choose standard repayment plans on loans with either fixed or variable interest rates, and what's great is that they don't charge you for origination, late, or prepayment fees. Sofi’s refinancing deals include unemployment protection and loan deferment options, plus they’ll honor the existing grace periods on any loans you refinance through them. They operate in all 50 states as well as the District of Columbia and almost all US territories. Since 2011, when they first started, they've helped customers pay off over $34 billion in debt with another $73 billion in funded loans. They have a rewards program that they say has given millions of their members over $34 million in benefits alone.

Eligibility for Student Loan Refinancing: So who’s eligible for student loan refinancing through Sofi? The basic requirements are:

• You must either be a US citizen, a permanent resident, or have non-permanent resident alien status with an acceptable and legal ID.
• You also have to have sufficient outside income, be employed, or have a job offer that will start within 90 days of your application.
• Or you need to be enrolled in or graduated from an eligible institution.
• As far as credit score goes, it must be 650 or over.
• You also have to have at least $5,000 worth of student loan debt to refinance; otherwise, it's not really worth it to go through all the trouble for them or for you.
• Finally, you need to meet Sofi's specific underwriting requirements for income, credit, and debt-to-income ratio, which they'll help you figure out.

How Does Refinancing Work? If you meet the requirements and think that refinancing might be right for you, you can use Sofi’s student loan refinancing calculator to check roughly how much refinancing with Sofi could save you. If the numbers look good and make sense to you, then you can move on to see if you pre-qualify and at what rates you can get using Sofi’s easy and really quick online application process.

Steps to See if You Qualify:

1. Soft Inquiry: The first step is a soft inquiry that doesn’t affect your credit score. When you click on "view your rate," you’ll be taken to a quick and easy online form that saves your progress in case you haven’t prepared all your details beforehand. You’ll be asked to give them your personal details, tell them what your refinancing goals are, and how much debt you have and what kind of loans you want to get refinanced. Then you link to your existing loans so Sofi can pull all the details, or you can add them manually, and based on that information, you get various rates and term combinations.

2. Review Terms and Rates: The second step is where you’ll see a range of different terms and rates, as well as your options for either variable or fixed-term loans. It’s entirely up to you what you choose depending on whether you want to pay your loan faster, save on interest, or if you need to make smaller payments over a longer period of time.

3. Complete Application: As for the third step, you’ll have to finish the application by submitting more information about your education, personal expenses, income, and other financial details. This final part of the process involves a hard credit pull that’ll reflect on your credit rating as a loan application. If your loan ends up being approved, Sofi will pay off your previous loan provider 3 days after you sign the agreement with them.

Final Thoughts: If you decide that you want to refinance a loan with Sofi, check out the affiliate link that I left down in the description to get a bit of a discount, which you wouldn’t get if you went directly to their website.

Options with Sofi: When it comes to the options you get with Sofi, you’ll see a range of different rates and repayment terms for refinancing loans, which start from a minimum of $5,000 to however much you owe on qualifying student loans. You get to choose from terms of either 5, 7, 10, 15, or 20 years with either fixed or variable interest rates, starting at 5.24% for fixed and 6.24% for variable with a maximum of 99.99% depending on the term you choose. The shorter the loan term, the lower the interest rate and vice versa. The lower the monthly payments, the more you’ll end up paying in total. You also have the option of choosing either immediate or interest-only repayment. As far as immediate repayment goes, you’ll have to make your first payment 30 days after your previous loan was settled. The interest-only payment option allows you to only pay interest for a certain time before you start making payments on the principal amount.

Features and Perks: Sofi offers several perks and features that are worth mentioning here:

• Forbearance Program: Allows borrowers to pause payments or make smaller payments under certain circumstances like major medical expenses or especially hard times.
• Deferment Options: Where you may be able to postpone payments if, for example, you lose your job or go back to school.
• Special Offers: If you’re in one of the better-paid professions like law, medicine, or finance, you stand a better chance of getting a good refinancing deal. Explore the specific refinancing options for parents, medical professionals, and law or MBA graduates where there are some very attractive offers, like the one for medical residents to only pay $100 a month for up to 7 years for refinancing medical student loans.
• Community Benefits: You get all the benefits of being a member of Sofi’s active 75 million strong community, like access to their members' lounge at Sofi Stadium in California and special offers on flights, hotels, and rental cars from Sofi travel. You can also take part in many of their experiences, events, networking opportunities, and complimentary offers. Additionally, you can access free financial planning and career coaching with rewards, referral bonuses, and discounted rates for other Sofi loans or services like estate planning. All of these can be accessed using Sofi’s app for both Android and iOS.

Personal Experience: When I reached the point I was earning enough to pay off my student loan faster, I transferred it all to Sofi because I was able to get a better interest rate and pay my debt off a lot quicker. I found the online application process to be pretty straightforward and transparent, so I knew exactly where I started at every stage. The reason I went with Sofi after exploring options with other lenders was because their rates were more competitive, I didn’t have to pay any upfront fees, and they had no maximum loan amount, which suited me. I was also impressed by their resource section, which is packed with help articles, support information, and useful finance tools and calculators.

Comparison with Earnest: When I wanted to refinance my student loan, I looked into a lot of other options. Besides Sofi, Earnest really caught my eye because they seem to offer more flexible terms. Just like Sofi, they allow you to pre-qualify online with no impact on your credit score. However, with Earnest, you don’t have to choose between the standard 5, 7, 10, 15, or 20-year terms; you can set up your own repayment term to the month and week. But not all of Earnest’s products are available in all states, and their eligibility criteria are more restrictive compared to Sofi. Overall, though, their rates are competitive, and they offer great repayment flexibility. But Sofi's unemployment protection and their community rewards program make them a more attractive option for me.

Pros and Cons of Sofi: So what are the pros and cons of refinancing with Sofi? On the one hand, Sofi offers competitive interest rates, no fees for origination, late payments, or prepayments, and you can benefit from their unemployment protection and flexible repayment terms. On the other hand, they may not be the best option for federal student loans if you're looking to access federal debt forgiveness or deferment programs. If you’re more interested in getting personalized loan terms and you meet their eligibility criteria, Sofi can be a really good choice.

Conclusion: In conclusion, refinancing student loans with Sofi could be a great way to save money and pay off debt faster. But before you make a decision, make sure you weigh the pros and cons, and check if it suits your financial goals and circumstances.