The borrowers who understand the critical distinctions between the two lenders will better position themselves to find the best deal.

Basic Terms from Laurel Road and Earnest

Variable-Rate Loans	5.29% - 9.20%	5.89% - 9.74%^
Fixed-Rate Loans	4.99% - 8.90%	3.95% - 9.74%^
Loan Terms	5, 7, 10, 15, and 20 Years	5 - 20 Years
Minimum Loan	$5,000	$5,000
Signup Bonus	NA	$150^

^ The lowest listed rate for Earnest is a 5-year variable rate loan, and rates for both lenders are listed as an APR. Please see the Earnest Disclosure for more details on rates and bonus terms.

At first glance, there isn’t much separating these two lenders. Both variable and fixed-rate loans appear in similar ranges.

However, things get interesting as we dig deeper into the two lenders.

Key Differences Between Lenders

Laurel Road and Earnest approach student loan refinancing from two unique perspectives.

Earnest, at its core, is a tech company. They believe that with the information provided in a short application, they can understand a borrower’s finances far more comprehensively than a traditional lender. Credit score and income are still important factors, but Earnest looks beyond these conventional metrics. For example, If you diligently save for retirement each month, it may help your cause with Earnest.

Laurel Road, however, is a product of a traditional bank. At first glance, this might seem like a negative, but it does have some benefits for borrowers. The majority of the major refinance lenders are tech-driven companies. Interest rates with tech-focused lenders tend to move very quickly with the broader market. The lenders backed by a bank tend to change rates a little slower. During times of inflation, traditional banking lenders often have the lowest interest rates.

Finally, Laurel Road places a big emphasis on doctors and those in the medical field. They seem to understand that a young physician’s starting salary is likely to increase considerably in the future. As a result, many recent medical school graduates find the best deal with Laurel Road.

Interest Rates Offered and Reader Feedback

The strategies used by the two lenders are interesting, but ultimately, the interest rates are the most important details.

More specifically, the interest rates actually offered by the two lenders are the most important details. In many cases, the lenders that advertise the lowest interest rates are not the lenders that offer the lowest interest rates.

In the case of Earnest, borrowers have reported a wide variety of interest rate outcomes. Many readers of this site have found the best deal with Earnest. Others have been insulted by surprisingly high rates. This is likely attributable to the unique formulas employed by Earnest.

Laurel Road tends to offer rates pretty close to their advertised rates in various loan categories. Unfortunately, Laurel Road tends to be in the middle of the road regarding approvals. They are not terribly strict, but a rejection at Laurel Road doesn’t necessarily mean a borrower can’t get approved anywhere.

Deciding Between Laurel Road and Earnest

These two lenders sit at the top of the student loan refinance rankings. Additionally, they have both been towards the top for many years.

If you are a borrower who is very responsible financially, but you don’t have a long credit history, or you have a lower income, Earnest should probably be the first company you check out.

However, Laurel Road should be your first stop if you are in the medical field.

If you don’t fit into either of these small boxes, both companies merit serious consideration. Checking rates with both lenders is often well worth the 10-15 minutes required to get an offer.

Finally, Earnest offers a $150 bonus to borrowers who refinance using the links on this page.

Other Lenders to Consider

	Splash is extremely focused on interest rates. They consistently have the lowest rates in numerous loan categories. Read more...
	ELFI is a traditional bank with a major focus on quality customer service. Getting approved is hard for some borrowers, but those that do get approved receive excellent interest rates. Read more...
	SoFi is the biggest name in the student loan refinance space. They consistently offer excellent rates with high approval numbers. Read more...
	LendKey partners with smaller banks and credit unions across the country. This approach results in higher approval numbers and competitive loan terms. Read more...

The post Laurel Road vs. Earnest Student Loan Refinance Showdown appeared first on The Student Loan Sherpa.

Even though these lenders both offer low interest rates, there are major differences between the two companies. From the source of funding to the approval process, Citizens Bank and Earnest use very different strategies.

The borrowers that identify and understand these differences will find the best refinance deal.

Citizens Bank vs. Earnest: Refinance Basics

Interest Rates	6.92% - 12.34%	5.89% - 9.74%^
Loan Terms	5, 7, 10, 15, and 20 Years	5 - 20 Years
Minimum Loan	$10,000	$5,000
Signup Bonus	-	$150^

Both lenders offer solid interest rates, with Earnest usually offering slightly lower rates to the best-qualified borrowers.

One of the first significant differences is the repayment length options. Citizens offers the more traditional 5, 7, 10, 15, and 20-year repayment plans. Earnest borrowers can pick any length between 5 and 20 years. If a borrower wanted to repay their loan in precisely 6 years and 7 months, Earnest would create that loan. The benefit of that level of specificity isn’t apparent, but for borrowers who want a specific loan length, Earnest is the only lender offering this feature.

From a terms and conditions standpoint, the lenders are pretty similar. Like most legitimate lenders, there are no prepayment, origination, or application fees with Citizens Bank or Earnest.

Both lenders also refinance federal loans into private loans. Refinancing a federal loan into a private loan is risky because borrowers lose federal perks and protections. However, all refinance lenders provide federal consolidation, so it is hard to fault Citizens or Earnest. Nonetheless, borrowers with federal loans should carefully consider their options before refinancing their loans with any private lender.

A Note About Earnest Ownership Several years ago Earnest was purchased by Naivent. Given Navient’s lousy reputation among student loan borrowers, there was concern that Earnest’s quality would drop.

Fortunately, there hasn’t been a noticeable difference in borrower feedback since this purchase. However, borrowers that wish to distance themselves from Navient may also want to avoid Earnest.

Citizens Bank Advantages

Citizens Bank is one of the few remaining traditional banks offering student loan refinancing. Most of the larger lenders: SoFi, CommonBond, and Earnest, are considered fin-tech companies.

The fin-tech lenders depend on investor interest in student loans to fund loans. If investor interest drops, these lenders have to raise rates. A bank like Citizens can fund their own loans. Borrowers out to find the lowest possible refinance rate should check rates with bank-based and fin-tech lenders to secure the best deal.

Another big advantage to Citizens is that they will refinance loans for borrowers without a degree. Most of the other student loan refinance companies require applicants to have a degree.

Earnest Advantages

The one aspect that separates Earnest from all other refinance lenders is their application process.

Typically, lenders care about two numbers when making credit decisions: monthly debt-to-income ratio and credit score. Earnest looks at the bigger financial picture of applicants. For example, a borrower who sets aside money each month in a retirement account or savings account may fair better with Earnest.

In the past, the additional information that Earnest required meant completing the application took longer. Today, getting approved with Earnest takes about 10 minutes, which is comparable to most other lenders.

Finally, Earnest offers a $150 Bonus to new customers who apply through this link. Full terms and conditions on the bonus program are available here.

Deciding Between Earnest and Citizens

Most borrowers looking to refinance should consider both Earnest and Citizens Bank.

Borrowers without a degree will find Citizens is one of the few lenders willing to refinance. Borrowers who need a very specific repayment length should focus on Earnest.

Ultimately, most borrowers will benefit from checking rates with both lenders. Earnest and Citizens use very different criteria for determining approval and interest rates. One borrower may get an excellent rate from Earnest while another might find a far better deal with Citizens. The exact lender formulas are closely guarded secrets, so borrowers looking for the lowest possible rate must shop around.

Click here to check rates with Citizens Bank.

Click here to check rates with Earnest.

The post Earnest vs. Citizens Bank Student Loan Refinance Comparison appeared first on The Student Loan Sherpa.

On the surface, there are a ton of similarities between these two companies. Both are fairly well known, and both advertise low rates and reasonable loan terms.

However, under the hood, these two lenders are very different. The key differences between Splash and Earnest can have a massive impact on which lender is best for borrowers.

Earnest vs. Splash Financial: The Basics

Interest Rates	3.99%* – 9.99%	5.89% – 9.74%^
Loan Terms	5 – 20 Years	5 – 20 Years
Minimum Loan	$5,000	$5,000
Signup Bonus	Up to $500	$150^

^ The lowest listed rate for Earnest is a 5-year variable rate loan and expressed as an APR. Please see the Earnest Disclosure for more details on rates and bonus terms.
* See Splash Disclosure for full details.

The basic terms and conditions with both Splash and Earnest are very similar. Splash tends to advertise slightly better interest rates, but overall, the numbers are very close.

Neither lender charges loan origination fees, application fees, or prepayment penalties. However, the lack of extra fees isn’t really a selling point as most legitimate refinance lenders avoid these fees.

Finally, both lenders will refinance federal student loans. This option may work for some borrowers, but for others, it would be a huge mistake. Borrowers considering this option should tread carefully.

The Big Splash Financial Advantage

The big advantage to Splash Financial is the variety of funding sources that they have at their disposal.

Even though this variety isn’t readily apparent to the borrower, the consequences are profound. The most noteworthy benefit is that Splash consistently has the best interest rates in many different loan categories. Since this site started tracking rate offerings, Splash usually ranks towards the top in our refinance rate rankings across many different loan types. Additionally, borrowers are more likely to get approved due to the many different funding opportunities.

This combination of excellent rates and strong approval numbers is the reason that Splash currently ranks at the top of our student loan refinance rankings.

For more about Splash, check out our Splash Financial Review.

Where Earnest Has the Edge

One aspect of the business model separates Earnest from all of the other refinance companies.

When making rate and approval decisions, Earnest takes a deeper dive into an applicant’s finances. Rather than focusing on credit score and income, Earnest looks at education level, income potential, savings, and spending habits.

For example, where most lenders don’t care about retirement contributions, Earnest wants to know how much you set aside. Earnest doesn’t require a 401(k) savings to get a loan, but they look more favorably upon the borrowers who do. They figure that setting aside money for retirement is a sign of financial responsibility. These applicants are more likely to get approved and more likely to get a lower interest rate.

When Earnest first entered the market in 2013, it had a well-deserved reputation for having a complicated application. However, as the years passed and the Earnest technology improved, the Earnest application simplified. Applicants can now complete an Earnest application in about 10 minutes, which is comparable to most other lenders.

To learn more about Earnest, check out our Earnest Review.

Picking the Best Lender

Ultimately, the best lender for most borrowers is the one that offers the best interest rate. For this reason, shopping around and rate checking with multiple lenders is the preferred method.

Splash currently ranks first in this site’s lender rankings because they consistently offer the best rate to applicants. However, given the unique approach used by Earnest, many borrowers will find they offer the best rate.

If you are someone who has a limited credit history but excellent spending habits, Earnest might be a good starting point. Most other borrowers should probably start with Splash.

Click here to check your rate with Earnest.

Click here to check your rate with Splash Financial.

The post Earnest vs. Splash Financial: Student Loan Refinance Showdown appeared first on The Student Loan Sherpa.

For many years, SoFi dominated our student loan refinance rankings leaderboard. SoFi had a combination of excellent interest rate offerings and high approval numbers that other lenders couldn’t match. Over the last couple of years, the market caught up with SoFi. In the case of Splash Finacial, they now offer lower interest rates than SoFi for many borrowers.

Deciding which company is better will depend upon borrower circumstances.

SoFi vs. Splash Financial: The Basics

Interest Rates	3.99%* - 9.99%	5.99% - 9.99%
Loan Terms	5 - 20 Years	5, 7, 10, 15, and 20 Years
Minimum Loan	$5,000	$5,000
Signup Bonus	Up to $500	NA

From the above table, it should be pretty clear that there are many similarities between these two lenders.

Outside of the numbers, the lenders are pretty consistent on terms as well. Neither company charges loan origination fees or prepayment penalties, and there are no major red flags with either lender from a loan servicing perspective.

Finally, both companies refinance both federal and private loans. Borrowers with federal loans should carefully consider their decision to refinance. Once federal loans are refinanced with a private lender, all of the federal perks, such as income-driven repayment plans and student loan forgiveness, are permanently eliminated.

SoFi Advantages

Refinancing with SoFi comes with two distinct advantages that most lenders cannot beat.

The SoFi Brand – While SoFi started as a student loan refinance company, it has grown considerably. SoFi now offers mortgages, personal loans, and investment management services. SoFi wants the student loan customers to become mortgage customers and wealth management customers. They call their customers “members.” The benefit to consumers is that they can expect higher quality service. If SoFi wants their borrowers to use other services, they need to treat them right.

SoFi Job Placement – One of the perks of being a SoFi “member” is the career coaching available to all customers. The advantage of helping borrowers find jobs is that they are more likely to repay their loans. Borrowers who lose their job may find this to be a valuable resource.

For more details on SoFi, be sure to check out our full SoFi Refinance Review.

Splash Financial Advantages

Splash current sits at the top of our student loan refinance rankings. The reason for this placement is simple: Splash has the best mix of low interest rates and high approval numbers.

Splash works with an extensive network of funding sources. As a result, Splash customers are more likely to get approved and more likely to get a low interest rate.

A final advantage to Splash is the $500 Bonus for customers who refinance at least $50,000 in student loans. Borrowers should still seek out the lender offering the best interest rate, as a slight rate difference will quickly add up to over $500 in savings for a large loan. However, the bonus is a great perk of going through the refinance process.

Further details on Splash are available on the Splash Financial Refinance Review.

Deciding Between Splash and SoFi

Ultimately, very little separates the two companies.

Borrowers that get identical rate offers may wish to go with SoFi for the member advantages, but most decisions should be determined by the lender that offers the lower interest rate.

Over the past year, Splash has consistently been the lender that offers the best rates. However, each borrower is different, and each lender uses a different formula for deciding what rate to offer. For this reason, borrowers are advised to shop around for the best rate. When rate shopping, both SoFi and Splash are worthy of consideration.

Click here to check your rate with Splash Financial.

Click here to check your rate with SoFi.

The post SoFi vs. Splash Financial: Student Loan Refinance Comparison appeared first on The Student Loan Sherpa.

At present they are both ranked in the top ten in our student loan refinance rankings. What separates these lenders?

SoFi vs. LendKey Basics

Variable-Rate Loans	5.31 - 9.12%	5.99% - 9.99%
Fixed-Rate Loans	4.89 - 9.04%	4.49% - 9.99%
Loan Terms	5, 7, 10, 15, and 20 Years	5, 7, 10, 15, and 20 Years
Minimum Loan	$5,000	$5,000
Signup Bonus	$150	NA

Interest rates and loan terms are quite similar for both lenders.

Arguably the biggest difference between the two companies is their structure. SoFi is a financial services tech company and LendKey works with a vast collection of banks and local credit unions.

Like all legitimate lenders, neither company charges loan origination fees, application fees, or prepayment penalties.

The LendKey Edge

LendKey’s edge comes from the fact that they work directly with local banks and credit unions.

These smaller local institutions have a desire to create lasting financial relationships with local college graduates. Because many of the credit unions are not-for-profit, they are able to offer lower interest rates than most national lenders.

[Further Reading: LendKey Student Loan Refinance Review]

SoFi’s Edge

SoFi originally started out as the “premium” student loan refinance company. They had the best rates, but these rates were reserved for people with excellent credit scores and debt-to-income ratios. This left many borrowers with less than perfect credit upset over being rejected.

However, for SoFi to grow as a lender, they had to be willing to accept more than just high earners with perfect credit. SoFi has largely accomplished this goal. As a result of the growth of SoFi, borrowers are now much more likely to be approved, and more likely to get a preferable interest.

SoFi has also expanded far beyond student loans. They now offer personal loans, mortgages, and wealth management services. These other financial services can be far more profitable than student loan refinancing. This creates a huge incentive for SoFi to offer low interest rates to establish a relationship with as many borrowers as possible. Even if a borrower has no interest in any of these services, the fact that SoFi offers them gives SoFi a reason to provide quality service in hopes of getting a borrower to sign up for more SoFi financial products.

In our In-Depth Review of SoFi, we also noted that SoFi offered a job placement program for borrowers. The bet that SoFi is making is that they will make more money by investing in their borrowers and helping them find jobs than they would if customers were left to struggle on their own.

SoFi vs LendKey: Loan Details

As an incentive for new borrowers, LendKey also offers $150 to borrowers who sign up for their service.

One item that all borrowers should understand is that both lenders are willing to refinance or consolidate federal government student loans. The advantage to borrowers is that it allows them to lock in lower interest rates. The danger is that federal perks like income-driven repayment plans and student loan forgiveness programs are gone forever if they refinance.

Ultimately, from a loan term standpoint, there is very little that separates these two lenders.

SoFi vs. LendKey: Interest Rates

The one number that matters to all borrowers is interest rates.

Both lenders consistently offer excellent interest rates.

The advertised interest rates in all categories are currently very close with these two lenders. Borrowers looking to find the best deal would be wise to apply with both to find the company that actually offers the lowest interest rate.

Click Here to check your rate with SoFi.

Click here to check your rate with LendKey.

The post SoFi vs. LendKey: Picking the Better Refinance Company appeared first on The Student Loan Sherpa.

When comparing SoFi and ELFI, very little separates the two companies. However, ELFI’s improved interest rates and approval rates give them a slight edge.

Both of these lenders rank toward the top of our student loan refinancing rankings, so no lender is clearly better than the other. Borrower circumstances may dictate which lender ends up being the better deal.

SoFi vs. ELFI – The Company Basics

ELFI, short for Education Loan Finance, is one of the newer national lenders offering student loan refinance. The ELFI strategy targets borrowers with large amounts of debt, excellent credit, and high incomes. While ELFI is a new name on the student loan marketplace, it is a product of SouthEast Bank, a longstanding regional bank. As we noted in our ELFI Review, this makes ELFI a compelling option.

SoFi is the established giant in the student loan refinance marketplace. Even though the company was founded less than ten years ago, SoFi now refinances more student debt than any other lender. Our SoFi Review explains how SoFi has grown so quickly.

Loan Terms Compared

These two lenders are very close in terms of interest rate offerings. ELFI rates currently start at 5.28% for their five-year variable-rate loan, while SoFi is a bit behind at 6.24%. On the fixed-rate side of things, Sofi has a 5.24% starting rate, while ELFI offers a slightly better 5.08%. Rates for both lenders tend to be close in nearly all loan categories. To compare these lenders across different loan types and lengths, be sure to check out our best student loan refinance interest rates page.

Neither lender caps maximum borrowing, but SoFi is willing to take on smaller balances starting at $5,000. To refinance with ELFI, you need a student debt of at least $15,000.

Finally, ELFI offers a signup bonus of $150. The $150 is a nice perk for signing up, but the interest rates offered will be the numbers that matter in the loan run.

Refinance Approval Rates

Approval rates with these two lenders tend to fluctuate.

When this article was first written, SoFi had a clear edge. As of the last update, ELFI appears to be slightly better than SoFi.

Ultimately, getting loan approval requires good credit and income, no matter what lender you select. The only way to know for sure what lender has the best interest rate is to apply with ELFI and then check your rate with SoFi.

SoFi and ELFI Perks

Each lender offers a consumer perk that is unique to the student loan refinance market.

SoFi Job Placement – Unlike any other lender, SoFi will help you find a job if you find yourself out of work or underpaid. Their calculation seems to be that by helping borrowers find jobs, they will spend less time and money chasing down borrowers who default on their loans. It is a bold strategy. We hope to see other lenders copy in the future.

ELFI Customer Support – Several lenders, including SoFi, have customer support entirely based in the United States. What makes ELFI unique is that each borrower is assigned a single point of contact for handling questions and issues. This means you have a direct number to the same person who is addressing any questions or concerns. The result is more personalized customer service and less time explaining the same problem over and over.

Which Student Loan Refinance Lender is Better: SoFi or ELFI?

Separating these two lenders is a bit of a challenge. ELFI has slightly better rates, but SoFi is the biggest lender for a reason.

In our student loan refinance rankings, we put SoFi in fifth place and ELFI in third. ELFI offers some of the very best rates to consumers with excellent credit scores and high income, but SoFi is still a willing lender able to offer excellent interest rates.

That being said, how we rank these two lenders should be of little significance to someone looking for the best deal on student loan refinancing. For a prospective borrower, the deciding factor should be the lender who offers the lower actual rate. The good news is that it takes less than 15 minutes total to check your rate with SoFi and to check your rate with ELFI.

Readers: Did you look into both of these companies? How did the rates they offered compare?

The post SoFi vs ELFI Student Loan Refinance Comparison appeared first on The Student Loan Sherpa.

In our student loan rankings, we provide a template for sorting through the various companies, but it isn’t an exact science. The reality is that the best student loan refinance lender is usually the one offering the best interest rate.

SoFi, Laurel Road, LendKey, Earnest, Citizens, and Splash are the lenders that most frequently appear in these reader emails. This makes sense because these lenders spend the most on advertising and offer some of the best interest rates in the student loan consolidation business.

Advertised Rates vs. Actual Interest Rates

If there is one concept that anyone shopping student loan refinance companies should understand, it is the difference between advertised rates and actual interest rates.

Advertised interest rates vary from company to company and can fluctuate based upon the market and cost of borrowing. Most of the top lenders will all be within a fraction of a percent of each other. However, just because a company advertises the lowest interest rate, it does not mean that it will offer any particular borrower the best interest rate.

Actual interest rates depend upon a number of different factors. The potential borrower’s credit score, income, debt-to-income ratio, occupation, and school all can be considered.

However, each lender may treat these factors differently. For example, Earnest also considers your retirement account balances. From their perspective, if you are saving a ton of money for retirement at a young age, it is a sign you are probably a responsible borrower. Each company guards its exact formula closely.

Lenders make money by offering the best rates to the consumers who are the lowest risk. The better they do identifying these consumers, the more money they will make.

What this means for you the borrower is that each lender will apply your particular information to their credit evaluation formula. SoFi may decide you are too much of a credit risk and decline your application or offer you a higher interest. Meanwhile, LendKey might look at exactly the same information and conclude that you are a safe bet, and offer you their lowest interest rate. Because each borrower is different and each lender looks at borrowers differently, it is impossible to know what lender will have the best rate.

A final factor that should be considered is the term of the loan. Laurel Road might offer an excellent rate on a short-term variable-rate loan, but the long-term fixed-rate loan might come with a really high interest rate. Meanwhile, Splash could do the opposite. Their fixed-rate loans might be the best deal, but their variable-rate offers don’t hold up. The only way to know what a lender will offer and what deal you can get is to apply.

Shopping Around

The extended discussion about advertised rates vs. actual rates is necessary to explain the importance of shopping around.

When it comes to student loan refinancing, that means applying with a number of companies to find the best deal.

The major credit bureaus encourage shopping around because multiple credit inquiries are treated the same as a single check, so long as they were within 14 days (some even give you longer). This means that the only downside to applying to multiple lenders is the time it takes to fill out the applications. It may be a bit of a headache, but the potential savings make it time well spent.

Those concerned about the time commitment required to shop around should estimate that it takes about 10 minutes per lender to check rates.

We have prepared a full list of lenders in our rankings and also included links to current promotions with most lenders.

What is the point of Rankings?

The rankings should be useful for a couple of reasons.

First, it provides a starting point for your research. Having all the companies in one place provides a guide for where you should go when shopping around.

Second, it is helpful when comparing the offers two companies have made.

Suppose SoFi and Citizens both offer the same interest rate for your consolidation. Part of the reason SoFi is ranked number one is because of its favorable cosigner release terms and because of its career development opportunities for borrowers who lose jobs. This gives them the edge in our rankings, so if the interest rates are close, it is a good tie-breaker.

Bottom Line

Finding the best student loan company is all about doing a little bit of extra legwork.

There are some differences between SoFi, Laurel Road, LendKey, Earnest, Citizens, and Splash, but at the end of the day they are all offering similar services and the best choice is typically the lender with the best rate.

The extra effort to find the best rate is minimal and it pays off.

Put together a list of lenders you are considering. Send out applications to each lender. Evaluate who has the best deal. Compare how the companies did from a customer service perspective. By the time you have offers and experience with the lenders, you should know what lender is best for you.

Shopping around in this manner will ensure that you save as much money as possible. At present, these lenders are advertising the lowest interest rates.

The post Deciding Between SoFi, Laurel Road, LendKey, Earnest, Citizens, and Splash appeared first on The Student Loan Sherpa.

Student loans were traditionally handled by the big banks and lenders like Sallie Mae. A few startups recognized an opportunity in the market. They would target low-risk borrowers (those with high incomes relative to their debt and good credit scores) and offer interest rates significantly lower than the big banks.

This approach has proven to be very lucrative to these companies. SoFi, one of the startups, is now the leading student loan refinancing company. Meanwhile, Sallie Mae left the business entirely, as did most of the other big banks. Citizens Bank is now the largest bank still in the student loan refinance business.

It might be tempting to treat this comparison as a new school versus old school approach, but the reality is that these two lenders are fairly similar. SoFi has had to adjust as it has become the largest company in student loan refinancing and Citizens has had to change its approach in order to stay competitive with the new lenders.

Despite the large list of similarities between the two lenders, there are some major distinctions between the two that all borrowers should understand.

SoFi Advantages: Red Carpet Treatment and Low Interest Rates

SoFi has taken over the student loan refinance marketplace by rolling out the red carpet for their target borrowers. This includes features like US-based customer service, community events for SoFi members, and a career development office for SoFi borrowers.

In our original review of SoFi, this was one of the features that we especially liked. Rather than spending money on collections, SoFi invests the money in helping their borrowers find jobs so that they can continue to make payments.

While these perks are nice, the value of any refinance ultimately comes down to interest rates. Over the years, SoFi has consistently been among the lowest of all the student loan companies. This is both in terms of the lowest advertised rate as well as the actual rates offered. It is for this reason that SoFi is near the top of our student loan refinance company rankings.

Citizens Advantages: Solid Rates from a Local Bank

Unlike the other big banks, Citizens has successfully adjusted to the highly competitive market for student loan refinancing services.

If you live in the Midwest or Northeast where Citizens Bank has a number of branches, you have the convenience of visiting an actual location to discuss your student loan issues and questions.

Citizens is also among the very best in terms of interest rates offered. Like SoFi, they have earned a reputation for consistently offering low rates and often being the company that ends up offering the best rate to the customers who take the time to shop around.

They also have built a solid reputation for prompt customer service and processing of loan applications.

Finally, Citizens is a traditional bank while SoFi falls into the “FinTech” category. Banks are usually more regulated by the government, so if there is an edge in this difference, it probably goes to Citizens.

A Key Difference

One word of caution that we would offer to prospective borrowers is to be very careful when it comes to cosigning loans.

Having a cosigner means that person is also obligated to pay back the debt. This involvement can complicate matters from a financial and personal perspective. For this reason, we strongly encourage borrowers to not involve a cosigner in this process.

Unfortunately, Citizens seems to place an emphasis on adding cosigners to the loan.

If you visit their website, one of the assumptions on the interest rate offerings is that the borrow has a cosigner. While the presence of cosigners may help them keep rates competitive with all of the new lenders, we think borrowers should focus on loans that do not require a cosigner.

The Citizens focus on adding cosigners and its three-year mandatory waiting period to remove a cosigner, is the main reason that they rank lower in our rankings.

Making a Choice Between SoFi and Citizens

Ultimately, these two companies are close enough that if you are debating between the two, it is probably best to just apply to both and find out who offers a better rate.

If it is a close call, we think SoFi should probably get the edge, but if there is money to be saved with choosing Citizens, then picking Citizens is an easy choice.

Check the rate you qualify for with SoFi here.

Check your rate with Citizens and several other student loan companies here.

The post SoFi vs. Citizens Bank Student Loan Refinance Comparison appeared first on The Student Loan Sherpa.

College Ave is starting to generate a lot of attention and offers a student loan refinance service that is definitely worth considering.

Today we will look at how these lenders stack up and the key differences between the two services.

The Basics: SoFi vs. College Ave

SoFi and College Ave both offer pretty competitive interest rates. Variable-rate loans currently start at 6.24% with SoFi and 6.99% with College Ave.  On the fixed-rate loan side of things, SoFi starts at 5.24% and College Ave starts at 6.99%. As loan length gets progressively longer, SoFi takes the lead in the interest rate comparison.

As far as repayment length, the companies have some key differences. SoFi has repayment lengths of 5, 7, 10, 15 and 20 years. College Ave recently added a 20-year repayment plan, and they are now advertising a total of 16 different loan terms between 5 and 20 years.

Additionally, College Ave will allow for interest-only payments for the first two years of a new loan. College Ave probably has more flexibility, but for the average borrower, we don’t necessarily see a particular advantage to the many options.

Digging Deeper: SoFi and College Ave Differences

If you look out our student loan consolidation rankings, right now SoFi checks in at 3rd place while College Ave is in 9th place.

The interest rate and repayment differences only partially explain the differences in the rankings for these two companies.

SoFi gets a boost in our rankings because they actually have a career services department dedicated to helping SoFi borrowers who are underemployed or unemployed. The calculation here seems to be that SoFi thinks they will be better off financially if they help their borrowers get a good job instead of spending money on debt collection. We see this consumer-friendly approach as a big plus.

Bottom Line

There are a few reasons that SoFi gets an edge over College Ave in this comparison.  However, the true test for most consumers will be the interest rates.  Because the rate ranges of these two companies overlap, it is entirely possible that College Ave offers a rate better than SoFi.  It is for this reason that both companies should be considered.  In fact, the more student loan consolidation companies you apply to, the better you can feel about the rate that you eventually find.  A full list of the major lenders is available here.

The post SoFi vs College Ave Student Loan Refinancing Comparison appeared first on The Student Loan Sherpa.

Not surprisingly, the two companies have a lot in common. Both lenders offer excellent rates, but there are reasons some borrowers may want to steer clear of both options.

SoFi and Earnest Basics

Variable-Rate Loans	5.99% – 9.99%	5.89% – 9.74%^
Fixed-Rate Loans	4.49% – 9.99%	3.95% – 9.74%^
Loan Terms	5, 7, 10, 15, and 20 Years	5 – 20 Years
Minimum Loan	$5,000	$5,000
Signup Bonus	NA	$150^

^ The lowest listed rate for Earnest is a 5-year variable rate loan, and rates for both lenders are listed as an APR. Please see the Earnest Disclosure for more details on rates and bonus terms.

On the surface, these two lenders look nearly identical. However, by digging a little deeper, some critical distinctions emerge.

Key Differences

Perhaps the most significant difference between the two companies is the application criteria for getting approved. As we noted in our review of SoFi, the credit score and income requirements are pretty high. In contrast, Earnest places less value on these two financial indicators. The Earnest approach looks at more financial records to better understand your responsibility with money and ability to pay. That is why they ask to connect your bank accounts and investment accounts (if you have them).

The downside to the Earnest approach is that they may require more records before your loan reaches final approval. Depending upon your circumstances, this could be a good thing or a bad thing.

A Red Flag for Each Lender

Both lenders have solid reputations.

However, each lender also has a skeleton in their closet that may upset potential borrowers.

When Earnest first entered the refinance market, it was a tech-based startup. They set out to be better than the rest by offering excellent rates and flexible terms. Several years ago, Earnest was purchased by Navient, a company disliked by many student loan borrowers. As noted in the comprehensive review of Earnest, this purchase was finalized many years ago, and it doesn’t seem to have changed Earnest. However, whether or not this is a problem is up to each individual borrower.

Similarly, SoFi is a tech-driven lender with consumer-friendly focus. As SoFi has grown, it has remained independent, and largely remained borrower-friendly. However, in the spring of 2023, SoFi made the decision to file a lawsuit to end the federal student loan payment and interest pause. As a result of this decision, some borrowers may choose not to work with SoFi.

The Sherpa Perspective: Nearly every major lender in the student loan refinance space is a for-profit company. As such, each lender has made some decisions that will likely upset some borrowers.

If I was refinancing my loans today, I’d pick the lender the offers the lowest rate and use them to save as much money as I could. The second another lender offers a lower rate, I’d refinance again. Lenders ultimately make decisions in their best business interests. As a consumer, I tend to do the same.

Important Similarities Between SoFi and Earnest

Now that we know the reasons borrowers might want to avoid these two lenders, it is important first to explain why they both rank highly on the student loan refinance lender rankings.

In addition to the low-interest rates, both companies offer similar terms that most borrowers should expect. For starters, neither company charges any origination fee. Along the same line, neither company charges any prepayment fee. Most telling is that contracts with both lenders have provisions for loan discharge in the event of disability or death. This is a term that not all lenders include but one that borrowers should demand.

The SoFi Advantage

The thing that separates SoFi from Earnest, and all other lenders, is their job placement program. When you apply for student loan refinancing, it usually means you are in a pretty good financial situation. Otherwise, you would have little chance of approval.

Few people consider the possibility of losing their job during this time.

Most lenders are willing to provide a short deferment or forbearance, but SoFi has employees who will help you find a new job or a better job. They bet that they will spend less money helping people find a job than what they would spend trying to collect the debt for people who fall behind. Nobody plans on losing their job, but if you do, you will likely be glad you opted to get your loan through SoFi. This program is part of the reason that SoFi checks in toward the top of our student loan rankings.

Another aspect of SoFi that borrowers should like is their transparency. Due to the federal interest rate freeze during the Covid-19 pandemic, borrowers with federal loans were much better off choosing not to refinance. This site evaluated how each lender did advising borrowers to make a smart decision. SoFi had the best guidance.

Reasons to Pick Earnest

Two big factors could make Earnest a better option for borrowers.

The first Earnest edge is the deeper dive they take into an applicant’s finances. Borrowers who keep an emergency fund and save for retirement may help their application with Earnest. Most other lenders ignore these signs of creditworthiness.

Secondly, Earnest allows borrowers to get very flexible with their repayment length. Most lenders force borrowers to pick between a 5, 7, 10, 15, or 20-year loan. At Earnest, a borrower can select a customized repayment length between 5 and 20 years.

Finally, Earnest also offers $150 to new borrowers who refinance their loans.

Sherpa Thoughts on Comparing SoFi vs. Earnest

I’ve been watching and reviewing student loan refi companies for the past decade.

Based on what I have seen during that time, I’d give SoFi a very slight edge. Generally speaking, borrowers who apply with SoFi have slightly better odds at getting approval, but there are undoubtedly many cases where Earnest comes out ahead.

These two lenders are structured very similarly as they are both categorized as “fin-tech” companies. For borrowers, this means the rate they offer will depend upon investor interest in student loan refinancing. At times Earnest will have more available capital and be more likely to approve a borrower. Other times, SoFi will have more funding available and be more aggressive about getting new customers.

Anyone looking to find the best student loan refinance rate should certainly consider both SoFi and Earnest.

Other Lenders to Consider

	Splash is extremely focused on interest rates. They consistently have the lowest rates in numerous loan categories. Read more...
	ELFI is a traditional bank with a major focus on quality customer service. Getting approved is hard for some borrowers, but those that do get approved receive excellent interest rates. Read more...
	LendKey partners with smaller banks and credit unions across the country. This approach results in higher approval numbers and competitive loan terms. Read more...

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