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Today we’ll be taking a deep dive into SoFi, an acronym for social finance, which offers mortgages, personal loans, student loan refinances, and even a credit card.
Their overall goal is to “help people get right for their money,” but we’ll focus on the mortgage part for the purposes of this review.
Chances are you’ve heard of the company, probably because SoFi Stadium is home to both the LA Rams and the LA Chargers.
Or maybe they refinanced your student loans at some point in the past. The San Francisco-based online bank is also making a big push into the home loan space.
So if you are a potential home buyer or an existing owner, you may want to add them to your list of lenders to consider.
sophie hostage fast facts
- Retail direct-to-consumer banks and mortgage lenders
- Provides home purchase financing and mortgage refinancing
- Founded in 2011, headquartered in San Francisco, CA
- Licensed to do business in 49 states and the District of Columbia
- Roughly $3 billion in home loans to be funded during 2021
- Also provides student loan refinancing, personal loans, insurance and banking services
- publicly traded company (Nasdaq: SOFi,
- Guaranteed timely closing and waives fees on refinances
Social Finance Inc., or SoFi for short, was founded in 2011 by a Group Number of students at Stanford Graduate School of Business.
They initially offered student loans and later expanded into personal loans, mortgages, credit cards, checking and savings accounts, and insurance as well.
One of the company’s founders, Mike Cagney, started his own company called Figma, which offers home equity lines of credit and crypto mortgages.
SoFi is based in San Francisco, CA and considers itself a digital bank. For this, they do not have physical branches.
Currently, they are licensed to do business in every state except Hawaii. However, purchase loans are only offered in New York State.
On April 3, 2023, the company announced the acquisition of Wyndham Capital Mortgage, a “leading fintech mortgage lender”.
This should further expand their reach in the mortgage sector and make them a significant player going forward.
In 2021, SoFi projects to fund nearly $3 billion in home loans, with nearly 90% of that volume coming from refinance transactions.
How to apply for a mortgage with SoFi
To get started, you can visit their website and check their daily mortgage rates and/or tinker with their online mortgage calculator.
If you like what you see, you can click “Start App” to get the ball rolling. Or if you have additional questions, you can call them directly.
Sophie prides herself on using the latest technology to make the process as paperless as possible. But they also have dedicated human mortgage loan officers who provide face-to-face assistance.
Their digital home loan application is powered by Fintech company Blend.
It allows you to fill out applications electronically, link financial accounts for easy import, and scan/upload documents when needed.
Many documents, such as loan disclosures, can also be e-signed to help save you time along the way.
Once approved, you will be able to login to your portal to check loan status, meet outstanding conditions and contact your loan officer.
Overall, they provide a good mix of technology and human customer service to help you reach the finish line.
Home Loan Programs offered by SoFi
- home purchase loan
- Refinance Loan: Rate & Tenure & Cash Out
- Conforming loans backed by Fannie/Freddie
- Jumbo Loans Loan amounts up to $3 million
- 3% down payment option
- Fixed-rate mortgages: 10-, 15-, 20- and 30-year loan terms
- HELOC
SoFi offers home purchase loans and refinance loans, including cash out refinances.
They lend on single-family homes, condos and 1-4 unit properties, including second homes and investment properties.
All of the loans they offer are conventional, meaning no FHA loans, VA loans, or USDA loans.
This may change in the future, but for now you’re limited to a conforming loan backed by Fannie Mae or Freddie Mac for 97% loan-to-value (LTV).
Or jumbo loans, with loan amounts of up to $3 million and down payments as low as 10%.
SoFi only offers fixed-rate mortgages (no adjustable-rate mortgages) with terms of 10, 15, 20, and 30 years.
Those who don’t want to lose their low rate on a first mortgage can take advantage of a home equity line of credit (HELOC).
SoFi offers HELOCs as large as $500,000 with up to 95% CLTV.
sofi mortgage rates
One cool thing about SoFi is that they promote their mortgage rates online. That doesn’t mean to underestimate how few they are.
You will see daily rates for the 30-Year Fixed, 20-Year Fixed, 15-Year Fixed and 10-Year Fixed on their mortgage homepage.
In retrospect, they appear to be quite competitive relative to other banks and online lenders.
You can also enter your loan criteria (like loan amount, property type, LTV) to get more personalized rates.
Currently, they are also offering 0.25% purchase price special on purchase transactions corresponding to 30 years. Be sure to inquire for details.
SoFi recently launched a “Lock and Look feature” that allows you to lock in your rate for up to 90 days before you find a property.
This is known as a prelock in mortgage jargon and can be helpful if you like where rates are but haven’t found a home yet.
And if you submit a fully executed purchase contract within 30 days of that rate prelock, SoFi will reduce the locked rate by an additional 0.125% at no cost.
One question mark is lender fees – they charge an “administrative fee” that is similar to an application or loan origination fee. But it is not clear by how much.
Be sure to inquire about both rates and fees if you apply. And note the mortgage APR that includes both items.
Sophie Close On-Time Guarantee
Like some other mortgage lenders, SoFi offers an on-time guarantee.
This means that if your loan doesn’t close on or before your closing date, and the delay is due to SoFi, they will provide you $2,000.
It is available only for the purchase of a primary residence (owner occupied). And the property must be a single-family residence (no condos).
Loan amount must meet and exceed Fannie Mae guidelines.
Additionally, you must be a W-2 borrower (not a self-employed borrower) and must have submitted an executed purchase agreement at least 30 days prior to the closing date.
There are other stipulations, such as locking the loan, paying for and scheduling an appraisal, and providing all required documentation within 24 hours of SoFi’s request.
and uploading any follow up documents within 36 hours of their request.
Basically, you need to do your part and have a straightforward loan scenario to qualify.
SoFi will waive their fee on mortgage refinance applications
Right now, SoFi is offering to waive its so-called administrative fee when you refinance your mortgage.
To be eligible, you must have SoFi’s mortgage to buy the home and close on it by June 30, 2023.
When you refinance, the “current market interest rate” must be at least 1% lower than the interest rate on your original loan.
And you should request that the administrative fee be waived at the time of application (and before you lock in your mortgage rate).
The offer is limited to one refinance transaction per person and must be done by June 1, 2024.
Whether mortgage rates decline by that amount remains to be seen…
With all of these types of deals, a waived fee may not mean much if a different mortgage company is offering a lower rate and/or lower fees.
Still take the time to shop with other companies, even if they are offering to waive the fee.
sophie mortgage review
Because SoFi offers a full spectrum of banking services, you’ll need to look carefully at reviews.
On Zillow, it has a 4.67/5 rating from over 300 reviews. All or most of these should be mortgage related, so you might want to start here first.
On Trustpilot, Sophie has an “Excellent” 4.6/5 rating from over 5,000 customer reviews. Take the time to read mortgage-oriented reviews to find them.
At ConsumerAffairs, they have a low 3.8/5 rating out of nearly 2,600 reviews. and a 2.9/5 with WalletHub from nearly 800 reviews.
Again, you need to filter the mortgage reviews from the rest to get a clear picture of customer service regarding home loans.
Although not accredited with the Better Business Bureau (BBB), they currently hold an ‘A+’ rating based on complaint history.
That being said, there were about 900 complaints on file in the past three years and they have a rating of 1.24/5 on the BBB website based on customer reviews.
Of course, many reviews may pertain to other products offered by the company that have nothing to do with mortgages.
In short, SoFi offers the latest technology and some pricing incentives that may make them competitive relative to other options.
But the lack of a full loan menu may be a turn off for some. Those with a straight loan landscape may find them worth considering if the price is right.
SoFi Mortgage Pros and Cons
Good
- can apply for mortgage online without human
- Introducing a Digital Mortgage Application powered by Blend
- Mostly paperless process with dedicated loan officers
- Promote their mortgage rates online
- Currently offering 0.25% purchase pricing special
- A plus BBB rating
- Waive their admin fee when you refinance
- free smartphone app
- free mortgage calculator
probably not
- Do not offer FHA/VA/USDA loans or adjustable-rate mortgages (ARMs)
- no physical branch locations
- don’t take hostages in hawaii
- Provide loans to buy a home only in New York
- Minimum FICO 620 required
- Hundreds of complaints on the BBB website
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