SoFi Mortgage Refi: Benefits and Costs to Consider

Considering a SoFi mortgage refi can be a smart move, especially if you're looking to lower your monthly payments or tap into your home's equity. This type of refinance can also provide access to cash for home renovations or other expenses.

One key benefit of a SoFi mortgage refi is the potential to save thousands of dollars in interest over the life of the loan. According to the article, SoFi offers competitive rates that can help homeowners save up to $15,000 in interest over the course of a 15-year mortgage.

However, it's essential to weigh the costs of a refinance against its benefits. SoFi mortgage refis come with origination fees, which can range from 0.25% to 1.5% of the loan amount.

SoFi's loan refinancing options have both advantages and disadvantages. One of the main pros is that they offer lower interest rates than many online lenders. They also allow borrowers to refinance student loans multiple times with no additional fees. Additionally, SoFi offers an interest discount of 0.25% for using autopay and 0.125% for additional loans.

One of the benefits of refinancing with SoFi is that it can combine both private and federal student loans. They also have tailored loan refinancing options for medical, dental, law, and MBA students. This can be a huge help for those in these fields who may have high-interest loans.

However, it's worth noting that SoFi's mortgage products are only available in 32 states. If you live in an area not served by SoFi, you'll need to look elsewhere. This can be a significant drawback for those who are interested in refinancing their mortgage with SoFi.

Here are some key pros and cons to consider when deciding whether to refinance with SoFi:

It's also worth noting that SoFi has a mostly paperless process with dedicated loan officers, and they publicize their mortgage rates online. However, they do not offer FHA/VA/USDA loans, and they have hundreds of complaints on the BBB website.

Refinancing is a powerful tool for homeowners with substantial equity. SoFi Mortgage Refinancing offers a way to tap into that equity, with a lower credit score requirement of 620 or even less.

Using your home's equity to pay off student loans can be a smart move, especially if mortgage rates are lower than student loan interest. You can cut your monthly payments significantly by converting a student loan into a mortgage payment.

However, it's essential to understand the risks involved. If you can't keep up with higher mortgage payments, the lender can foreclose on your home. This is a serious consequence to consider before making a decision.

Borrowers can usually shave several percentage points off their interest by refinancing their student loans through SoFi. This can lead to significant long-term savings and a lower overall debt burden.

Refinancing with SoFi can be a great option for homeowners looking to save money on their mortgage payments. SoFi offers a lower interest rate than many online lenders, which can lead to significant savings over time.

One of the benefits of refinancing with SoFi is that they allow you to combine both private and federal student loans into a single loan. This can make it easier to manage your debt and potentially save money on interest.

Refinancing with SoFi can also provide a lower credit score requirement, with a minimum of 620 FICO required. This can be beneficial for those who may not have the best credit history.

SoFi's mortgage rates are publicly available online, making it easy to compare rates and find the best option for your needs. At the time of writing, their rates appeared to be competitive with other banks and online lenders.

Here are some of the benefits of refinancing with SoFi:

SoFi mortgage refi comes with its own set of costs and fees, which can be a bit overwhelming. SoFi doesn't charge loan origination fees or prepayment penalties, but there are still financial consequences for late payments or missed payments.

Some common fixed closing costs include a loan application fee, which can cost up to $500, and a home appraisal fee, which can range from $300 to $400. Additionally, credit report fees can range from $10 to $100 per borrower, and lender's title search fees can range from $75 to $200.

Here are some typical fixed and percentage-based refinance closing costs:

And here are some typical percentage-based refinance closing costs:

To minimize costs, it's essential to shop around and compare offers from different lenders. This can help you find the best deal and avoid paying unnecessary fees.

Refinancing a mortgage can be a complex process, but understanding the common fees involved can help you make informed decisions. The average cost to refinance a mortgage can vary, but it's essential to know what to expect.

Some fees to refinance are flat fees that vary by lender. According to Example 4, a loan application fee can cost up to $500, while a credit report fee can range from $10 to $100 per borrower.

A home appraisal fee is another common cost, typically ranging from $300 to $400. You may also be charged an abstract fee, which can cost between $200 and $1,000. A lender's title search fee can range from $75 to $200.

Some refinance costs are based on a percentage of the loan amount. For example, a loan origination fee can be 1% of the loan amount, while mortgage points can cost 1% of the mortgage amount per point.

Here are some typical percentage-based refinance closing costs:

SoFi is currently offering to waive its administrative fee on mortgage refinance applications.

To be eligible, you must take out a SoFi mortgage for the purchase of a home and close by June 30th, 2023, and request that the administrative fee be waived at the time of application.

This offer is limited to one refinance transaction per person and must take place by June 1st, 2024.

Keep in mind that a waived fee doesn't necessarily mean you'll be saving the most money; it's still a good idea to shop around with other companies to compare rates and fees.

SoFi offers a 0.25% discount for auto pay, which reduces the effective interest rate of your loan as long as the autopay arrangement remains in place.

This discount can make a big difference in the cost of your loan, as it's equivalent to dropping the rate on a loan originated at 6% to 5.75%.

Auto pay isn't required to get a loan, but SoFi encourages it and using it helps borrowers be consistent with payments.

If you stop auto pay, the discount will be terminated, so it's a good idea to think carefully before canceling it.

SoFi doesn't charge loan origination fees or have prepayment penalties, which means you won't get hit with extra fees for paying off your loan early.

You can also avoid late fees, but make sure to make timely payments to avoid accumulating more interest, which will increase your overall payments.

SoFi offers a 0.25% discount for auto pay, which can help you save money on your loan, but the discount is terminated if you stop making automatic payments.

Student loan refinancing is available for 5, 7, 10, 15, and 20-year terms, while personal loans are available for 3 to 7-year terms, giving you flexibility to choose a repayment period that suits your needs.

SoFi doesn't charge loan origination fees or prepayment penalties, which is a big plus. However, making late payments or paying less than what's due can accumulate more interest, leading to higher payments overall.

You can get a 0.25% discount for auto pay, but it's terminated if auto pay is stopped. This discount is a nice incentive to set up automatic payments.

Student loan refinancing is available for 5, 7, 10, 15, and 20-year terms, while personal loans are available for 3 to 7-year terms. This gives you flexibility to choose a repayment term that suits your needs.

Recurring closing costs, such as homeowners insurance and property taxes, are usually due at closing. Six months of property taxes are typically required.

Here are some common fixed closing costs you might encounter:

If you're considering refinancing, think about how long you plan to keep your home and whether the savings will outweigh the costs.

Reducing your repayment term can be a smart move, especially if you're eager to pay off your mortgage quickly. You can shorten your mortgage term from 30 years to 15, for example.

Monthly payments may increase, but you'll pay significantly less interest over the life of the loan. This is because a lower rate and a shorter term mean you're not paying interest for as long.

The amortization chart of a mortgage calculator shows just how much interest you can save by shortening your repayment term.

SoFi has an A-plus rating by the Better Business Bureau, which suggests a good track record.

The company ran into trouble with the Federal Trade Commission in 2018 for making false claims about refinancing savings, but settled in 2019 and has since improved its practices.

SoFi has received 512 complaints from the Consumer Financial Protection Bureau since 2011, with a surge in 2022 after changing the model for SoFi Money.

SoFi's Close On-Time Guarantee is a unique perk that sets them apart from other mortgage lenders. It's a $2,000 guarantee that kicks in if your loan doesn't close on or before your closing date and the delay is due to SoFi.

To qualify, you need to be buying a primary residence, a single-family residence, and meet Fannie Mae's guidelines. The loan amount must be conforming, which means it meets specific standards set by Fannie Mae.

As a W-2 borrower, you'll need to have an executed purchase contract submitted at least 30 days prior to the closing date. This is a crucial step to ensure a smooth process.

You'll also need to lock your loan, pay for and schedule the appraisal, and provide all required documentation within 24 hours of SoFi requesting it. And if they need any follow-up documents, you'll need to upload them within 36 hours of their request.

SoFi has had some issues with false claims in the past, but it settled with the FTC in 2019 and has an A-plus rating by the Better Business Bureau since then.

The Consumer Financial Protection Bureau has received 512 complaints about SoFi since 2011, with a significant spike in 2022 after a model change for SoFi Money.

98% of SoFi users in a 2019-member survey said they'd recommend SoFi to friends and family, citing ease of getting a loan, good rates, and the ability to refinance as many times as a borrower wants.

Customer service has been a common complaint, with negative reviews on the BBB website and elsewhere online.

SoFi has an "excellent" 4.6/5 rating from over 5,000 customer reviews on Trustpilot, but a 3.8/5 rating from about 2,600 reviews on ConsumerAffairs.

Despite holding an 'A+' rating based on complaint history, SoFi has nearly 900 complaints on file over the past three years and a dismal 1.24/5 rating on the BBB website based on customer reviews.

The company has a full lending menu, but those with straightforward loan scenarios may find them worth considering if the price is right.

Using the same title insurance company for your refinance can save you money. This is because you can ask for a reissue rate, which is a discounted rate for a new policy.

The reissue rate is typically lower than the original rate, so you can save some cash. For example, you can save money on the lender's title insurance policy by asking for a reissue rate from the title insurance company that was used for the original loan.

This can help you save even more on closing costs, which can add up quickly.

Think about rolling closing costs into your SOFI mortgage refi if you plan to keep the loan for more than a few years. This move can increase the principal and total interest paid, but it might be worth it if you'll be in your home long enough to break even.

A no-closing-cost refinance can be a good option if you don't have the cash on hand to pay for closing costs upfront. This approach is the only feasible way to achieve a refinance if you can't afford the upfront payment.

Comparing estimates from multiple lenders is a great way to find the best deal. You can apply with as many lenders as you wish and receive a loan estimate from each, including costs like credit reports and appraisals.

Some closing costs, like credit reports and appraisals, are non-negotiable and will be included in your loan estimate under Section B.