Bank Introduction

SoFi

Minimum FICO Credit Score

640

BBB Rating

A+

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Citizens Disclosures

UNDERGRADUATE LOANS: Fixed rates from 4.49% to 14.70% annual percentage rate ("APR") (with autopay), variable rates from 5.49% to 13.97% APR (with autopay). GRADUATE LOANS: Fixed rates from 4.99% to 14.48% APR (with autopay), variable rates from 5.99% to 13.97% APR (with autopay). PARENT LOANS: Fixed rates from 6.50% to 14.83% APR (with autopay), variable rates from 6.32% to 14.03% APR (with autopay). For the SoFi variable-rate product, the variable interest rate for a given month is derived by adding a margin to the 30-day average SOFR index, published two business days preceding such calendar month, rounded up to the nearest one hundredth of one percent (0.01% or 0.0001). APRs for variable-rate loans may increase after origination if the SOFR index increases. Interest rates for variable rate loans are capped at 13.95%, unless required to be lower to comply with applicable law. Lowest rates are reserved for the most creditworthy borrowers.

If approved for a loan, the interest rate offered will depend on your creditworthiness, the repayment option you select, the term and amount of the loan and other factors and will be within the ranges of rates listed above. The SoFi 0.25% autopay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. Information current as of 06/29/2023.

Enrolling in autopay is not required to receive a loan from SoFi. Loans originated by SoFi Lending Corp. or an affiliate (dba SoFi), licensed by the Department of Financial Protection and Innovation under the California Financing Law License No. 6054612. NMLS #1121636 (www.nmlsconsumeraccess.org).

Loan reviews

SoFi is an online lender founded by Stanford business school students in 2011. SoFi offered student loan refinancing as of May 2012, and the San Francisco-based company added private student loans in 2019. Choose from undergraduate, graduate, law, MBA, health profession, refinance or parent loans with no fees.

Pros

Pay no fees. That includes origination fees, application fees, late fees and insufficient funds fees.
Choose from flexible repayment options. SoFi offers a co-signer release option, plus borrowers hit by financial hardship can access programs and benefits.
Prequalify. The lender uses a soft credit pull, which will not hurt your credit score, to check whether you and your co-signer may be approved for a private student loan before you formally apply.

Cons

Pay no fees. That includes origination fees, application fees, late fees and insufficient funds fees.
Choose from flexible repayment options. SoFi offers a co-signer release option, plus borrowers hit by financial hardship can access programs and benefits.
Prequalify. The lender uses a soft credit pull, which will not hurt your credit score, to check whether you and your co-signer may be approved for a private student loan before you formally apply.

Bank Introduction

Sallie Mae

4.4

FIXED APR4.50% to 15.49% with autopay

VARIABLE APR6.12% to 16.45% with autopay

MAX. LOAN AMOUNTCost of attendance, minus aid

MIN. CREDIT SCOREMid 600s

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Citizens Disclosures

Rates displayed are for undergraduate and career training students:

Lowest rates shown include the auto debit discount: Additional information regarding the auto debit discount: Advertised APRs for undergraduate students assume a $10,000 loan to a student who attends school for 4 years and has no prior Sallie Mae-serviced loans. Interest rates for variable rate loans may increase or decrease over the life of the loan based on changes to the 30-day Average Secured Overnight Financing Rate (SOFR) rounded up to the nearest one-eighth of one percent. Advertised variable rates are the starting range of rates and may vary outside of that range over the life of the loan. Interest is charged starting when funds are sent to the school. With the Fixed and Deferred Repayment Options, the interest rate is higher than with the Interest Repayment Option and Unpaid Interest is added to the loan’s Current Principal at the end of the grace/separation period. To receive a 0.25 percentage point interest rate discount, the borrower or cosigner must enroll in auto debit through Sallie Mae. The discount applies only during active repayment for as long as the Current Amount Due or Designated Amount is successfully withdrawn from the authorized bank account each month. It may be suspended during forbearance or deferment. *These rates will be effective 06/26/2023.

Terms:

Examples of typical costs for a $10,000 Smart Option Student Loan with the most common fixed rate, fixed repayment option, 6-month separation period, and two disbursements: For a borrower with no prior loans and a 4-year in-school period, it works out to a 10.28% fixed APR, 51 payments of $25.00, 119 payments of $182.67 and one payment of $121.71, for a Total Loan Cost of $23,134.44. For a borrower with $20,000 in prior loans and a 2-year in-school period, it works out to a 10.78% fixed APR, 27 payments of $25.00, 179 payments of $132.53 and one payment of $40.35 for a total loan cost of $24,438.22. Loans that are subject to a $50 minimum principal and interest payment amount may receive a loan term that is less than 10 years.

Loan reviews

Sallie Mae is a publicly traded consumer bank that offers private student loans to pay for undergraduate, graduate and professional degrees, among other educational needs. Congress started Sallie Mae in 1972 as a government-sponsored entity that serviced student loans. The lender went private in 2004 and today provides a range of student loan products. Additionally, Sallie Mae Bank offers savings products and other tools to help families plan and pay for college, including a credit card that earns bonus cash back to help you pay off any student loan.

Pros

Student loans can completely cover school-certified expenses, such as tuition and fees, books, and other related costs.
Borrowers pay no loan origination fee.
Autopay enrollment qualifies you for a 0.25-percentage-point interest rate discount.

Cons

Sallie Mae does not refinance student loans.

The lender strongly encourages adding a creditworthy co-signer.

Difference between Private Student Loan and Federal PLUS Loan

Private student loans and Federal PLUS loans are both options available to students and their families to finance education expenses. However, there are several key differences between these two types of loans. Here are some important distinctions:

1. Source of Funds:

Private Student Loan: Private student loans are offered by private financial institutions such as banks, credit unions, and online lenders. These loans are not funded or guaranteed by the federal government. Federal PLUS Loan: Federal PLUS loans are federal loans available to parents of dependent undergraduate students or to graduate or professional students. They are issued by the U.S. Department of Education.

2. Borrower Eligibility:

Private Student Loan: Private student loans often require a credit check and typically consider the borrower's creditworthiness, income, and debt-to-income ratio. Students may need a co-signer if they have limited credit history or insufficient income. Federal PLUS Loan: Federal PLUS loans do not require a credit check for eligibility. However, borrowers with an adverse credit history may face additional requirements or need an endorser (co-signer) to qualify.

3. Interest Rates:

Private Student Loan: Interest rates for private student loans can vary based on the borrower's creditworthiness and market conditions. Some private lenders may offer both fixed and variable interest rate options. Federal PLUS Loan: Federal PLUS loans have a fixed interest rate set by the federal government for each academic year. The interest rate is generally higher than the rates offered for federal direct student loans.

4. Repayment Options:

Private Student Loan: Private student loans may offer various repayment options, including immediate repayment, interest-only payments, or deferred payments while in school. Repayment terms can vary among lenders. Federal PLUS Loan: Federal PLUS loans typically offer a deferment option while the student is enrolled at least half-time. After graduation or leaving school, borrowers have a six-month grace period before they are required to begin repayment. Federal PLUS loans also provide access to federal loan forgiveness and income-driven repayment plans.

5. Loan Limits:

Private Student Loan: Private student loans often have higher loan limits compared to federal loans. The maximum loan amount varies among lenders and is typically based on the cost of attendance minus other financial aid received. Federal PLUS Loan: The loan limit for Federal PLUS loans is determined by the cost of attendance minus any other financial aid received. The maximum amount is not as high as some private loans but can still cover a significant portion of education expenses.

6. Loan Forgiveness and Discharge:

Private Student Loan: Private student loans generally have fewer options for loan forgiveness or discharge. However, some private lenders may offer loan discharge or forgiveness in specific circumstances, such as death or permanent disability. Federal PLUS Loan: Federal PLUS loans are eligible for certain forgiveness and discharge programs, such as Public Service Loan Forgiveness (PSLF) and Total and Permanent Disability (TPD) discharge. It's important to carefully review the terms, interest rates, repayment options, and benefits offered by both private student loans and Federal PLUS loans. Compare the options available to you based on your specific financial situation, loan needs, and future plans to make an informed decision about which type of loan best suits your needs.