Student loan refinancing at low rates that reduce your payments with no added fees.
Choosing the right student loan option could mean thousands of dollars in savings over the years. Refinancing or consolidating your student loans can put you back in control and give you some breathing room on your monthly payments. When you’re ready to start reconsidering your student loan options, SoFi and Earnest are both solid places to start. But how do they stack up against each other?
An overview of SoFi and Earnest
On top of offering multiple loan products, SoFi offers mentoring services and hosts events for its community of over 275,000 members. It also offers career support to help you get to you where you need to be in the professional world.
Earnest is an online lender that can help you refinance federal, private and Parent PLUS loans. It has a unique way of assessing potential borrowers that goes beyond the standard credit check by looking into your ability to save money, your earning potential and employment history.
Am I eligible for student loan refinancing with SoFi or Earnest?
To be eligible for student loan refinancing with SoFi or Earnest, you must:
- Have good to excellent credit.
- Be at least 18 years old and a US citizen.
- Have a minimum student loan balance of $5,000.
- Have an associate’s degree or higher.
- Be employed.
How are they different?
Borrowing from SoFi is kind of like joining a club. SoFi gives existing members who qualify an extra 0.125% rate discount in addition to access to a long list of perks including career advice, forbearance, deferment and a startup funding program for member entrepreneurs.
If you do choose to apply with a cosigner, inform them that there isn’t a cosigner release option. Instead, you’ll need to refinance your loan again.
Earnest has a unique Precision Pricing program that could be beneficial to someone with entry-level income or who is currently trying to building credit. You can extend your payments up to seven days, and you have the option of switching between fixed and variable rates once every six months after you’ve paid your bill on time for six months.
Unlike SoFi, Earnest doesn’t let you apply for a loan with a cosigner.
Which lender offers lower interest rates?
SoFi offers student loans with variable rates starting at 2.48% and fixed rates starting at 3.899%.
Earnest student loans have variable rates as low as 2.47%. For fixed rate loans, it offers a starting APR of 3.89%.
SoFi only beats out Earnest if you’re looking to refinance your loan for a set term of 10 years or more. If that’s not what you’re looking for, Earnest’s starting APR for variable-rate loans is the lower of the two. But remember, these are only the advertised starting rates and aren’t guaranteed. Every applicant has a different credit history, which makes it difficult to predict which lender will give you the best deal in your unique situation.
Which lender has fewer fees?
SoFi doesn’t charge any origination or prepayment fees, but if you make a payment more than 15 days late, you will face a late fee.
Earnest also won’t hit you with any origination or prepayment fees, and you won’t have to worry about paying a late fee if you miss a payment.
Earnest wins this category by not charging late fees. But if you’re thinking about possibly racking up late fees before you even apply for the loan, you may want to reconsider taking on the loan in the first place.
Perks both SoFi and Earnest offer to its borrowers
Which has a better reputation?
SoFi’s 9.1 Trustpilot review as of June 2018 is nothing to sneeze at. Its program to assist with unemployment shows that it care about its customers. Members also seem to enjoy the handful of perks — SoFi events, mentor services and more.
Earnest has around 150 Trustpilot reviews as of September 2018, scoring it a decent 9.4 out of 10. Customers seem to find the application process simple and the customer service helpful. The Precision Pricing tool may give applicants with little credit history a better chance of approval, as the process is not as traditional as other lenders.
Although Earnest walks away with a slightly higher score, SoFi has nearly 2,000 reviews on Trustpilot. People not only trust its services, but rate it highly time and again. There’s a lot to be said for that when it comes to picky online reviewers.
How much can I borrow with each lender?
Student loans from SoFi can be anywhere between $5,000 and the full balance of your qualified education loans.
Earnest student loan refinancing ranges from $5,000 and has no limit.
Since both Earnest and SoFi have a minimum of $5,000 and no maximum limit, both are good options to refinance your total student debt, even if it happens to be a large loan amount.
Which lender processes applications more quickly?
Both online lenders have quick, easy applications that can get you preapproved rates within minutes. If you decide to move forward with a full loan application after preapproval, both lenders will conduct a credit inquiry to give you the most accurate rates.
If approved, SoFi will likely get you your money within seven to 10 days.
If approved, Earnest will likely get you your money within 10 days.
Depending on how quickly you can get you documents together, both lenders tend to move quickly.
In the end, it all comes down to what you want out of your lender. The difference in fees is marginal, and if you’re preapproved, the rates might be nearly identical. But what SoFi offers that Earnest doesn’t is a well-rounded social and professional networking space for its members. If neither lender feels like a fit, shop around for other student loan providers and see what seems like the best deal.
Be aware that if you refinance your federal loans with a private lender, you could lose some of the benefits, including longer deferment.
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