SoFi vs. ELFI: What is Better?


If you're repaying student loans and haven't refinanced them, you're probably wasting money. Here we look at SoFi and ELFI, two excellent loan refinance companies, and compare what they offer.

In college, it’s easy for people to forget about their impending debt and student loans. The stress of college work and exams results in people putting the debt to the back of their minds. However, once they finish their bachelor’s degree and are looking for a job, they’re already carrying massive amounts of debt. The average student loan debt ranges from $75,000-$150,000.

Even those who manage to get a decent job after graduating will have a tough time paying off their debt. It might take many years, even decades, to pay off all the debt, and the federal student loans tend to offer unfavorable interest rates. Despite the short-term payment advantages, these loans still end up with the users racking up interest in the long-term. The end result is that the loans end up costing more.

That’s where private lenders that provide refinancing options for federal student loans enter the equation. The post looks to compare two prominent private lenders that provide refinancing facilities for education loan finance. These are SoFi and ELFI. Both companies offer excellent services to borrowers.

However, there might be certain conditions that lead to one refinancing company being better than the other. Continue reading to see which company will suit your financial situation best.

SoFi Overview

When it comes to refinancing student loans, SoFi is the very first private lender that comes to mind. Their website states that they’ve successfully refinanced $18 billion in student loans to more than 300,000 people. The website also has an exceptionally high 98% referral rate. They’re one of the largest student loan providers that offers student loan refinancing.

Aside from offering student loans, they also provide a variety of financial products, including investment services, personal loans, home mortgages, loan consolidation, and insurance. You might think that SoFi’s evolution into these multiple sources will cause their focus to divert from student loan refinancing. People tend to forget that SoFi started as a student loan refinancing organization, which means they have a lot of data on defaults and can offer competitive pricing.

Anyone can make use of the services SoFi has to offer through a simple online application process. Members that sign up also have the opportunity to receive customer support all seven days. They provide brilliant customer service and don’t have any origination or application fee.

Flexible Repayment Options

One of the best things about SoFi is that they offer great flexibility in their repayment options. They offer more competitive interest rates and allow applicants to choose between saving on monthly payments or saving on long-term interest costs.

While paying lower monthly costs offers short-term benefits, you’ll end up with a larger loan balance in the long-term. It’s especially helpful for people currently dealing with tight funds and ensures they can make lower loan payments.

There are also no prepayment penalties, so if the borrowers wanted, they could opt for the lower monthly cost. While opting for lower monthly costs, they can pay their loan repayment a little more each month to pay off their total loan amount faster.

Members who are struggling also have the option of taking forbearance. SoFi allows members to pause monthly payments. They can take advantage of the break for three consecutive months and can use it for a maximum of 12 months throughout the loan. During this time, members can still pay off the interest to help make sure that it doesn’t accumulate.

SoFi also doesn’t just stick to one type of federal loan. They extend refinancing support for all different kinds. This includes parent plus loans. Applicants can apply to refinance loans from as low as $5,000 to the total amount of their student loan debt.

SoFi Benefits

Aside from providing better loan terms and lower rates, SoFi also offers some other additional perks to members. Not only is SoFi one of the best loan servicers in the industry, but they also offer career services. Those that sign up can benefit from career mentoring that will help them be more successful in their professional endeavors.

During these testing times, unemployment is at a record high, but SoFi members are in a significantly better position. They offer unemployment protection in the form of forbearance. While that may be a common benefit, the company takes it one step further by actively helping members find a new job.

They believe that collecting money from members when they’re not working requires more money and effort than helping them. This kind of career coaching can prove beneficial for new graduates.

Members can also benefit from joining the SoFi community and participate in networking experiences and social events. Members even have the opportunity to earn money through SoFi, thanks to the referral program.

Lawyer Perks

While companies like to extend their business to as many customers as possible, every organization has the ideal customer in their head. For SoFi, lawyers fit the equation perfectly. They work with individuals on many different income levels but prefer high-income professionals.

New lawyers can expect to earn upwards of $50,000 a year, which puts them in a decent position to pay back their loans. The bottom line is that private lenders like SoFi prefer high-income individuals because they can pay back their loans and have decent credit scores.

That’s enough information to get potential customers familiar with the services and benefits that SoFi provides. Let’s take a look at what the competitor Educational Loan Finance (ELFI) offers.

ELFI Overview

ELFI is a division of SouthEast Bank and receives vast recognition for being among the first institutions that allowed borrowers to consolidate multiple loans into a single loan to get better repayment terms.

ELFI is an excellent option for lawyers who take out multiple loans to finance their way through undergraduate programs and law school. Not only does the organization boast expert loan advisory services, but they also offer personalized options and allow for co-signers to give loanees more security.

ELFI is a student loan refinancing lender, and loanees that approach them will hand over their loan terms, monthly payments, and interest rates. Signing up for their services is incredibly simple, and anyone can access their form on the website.

The website will require potential applicants to fill a form that contains questions regarding their personal information, education history, financial situation, and the total loan amount. ELFI offers refinancing services for both private student loans and federal student loans.

Only U.S citizens or permanent residents are eligible for signing up with ELFI. There’s no need to worry about the application affecting credit score because it doesn’t result in a hard credit check.

However, ELFI will verify the applicant’s identity and credit history to determine what products they can offer. They also look at the information to help assess whether the applicant is eligible for more competitive rates.

After filling in the information, depending on their eligibility, applicants will get to see multiple different variables and fixed interest rates they can choose depending on a credible soft credit check. The interest rates and loan terms on offer are significantly better than what the federal loans offer.

Along with that, it’ll become evident to applicants that the variable rate loans are a better deal than fixed-rate loans. Additionally, longer terms will also lead to a higher overall interest rate. The best interest rates on offer are available with five-year repayment plans on a variable rate.

After selecting what interest terms and credible repayment conditions suit the applicant best, they can complete the application. ELFI will provide the loanee with all the details of their refinancing conditions, including any disclaimers, to compare with their existing student loan terms. The company also doesn’t charge an origination fee as long as the new loan terms are lower than the existing loan.

Benefits of ELFI

One of the significant benefits of ELFI is that it doesn’t impact the applicants’ credit score. They only need to undertake a soft credit check to get the different loan terms available to them.

ELFI also doesn’t charge a prepayment penalty for individuals who want to pay off their loans earlier than the loan’s life. There’s no origination or application fee either, and the terms will be significantly better than the existing federal student loan.

Not only does the organization allow for loan refinancing, but they also provide applicants with a personal loan advisor. These are experts that’ll help individuals evaluate the student loan refinancing plan and pick the option that makes the most sense.

SoFi Student Loan VS ELFI Loan Terms

The interest rate offered is one of the most critical choices when borrowers are looking to refinance a loan. Ideally, loanees should look to get the lowest interest rate possible. ELFI currently offers a rate starting at 2.39% for their five-year variable-rate loan, and SoFi begins at 1.99%.

When it comes to fixed-interest rate loans, ELFI offers a rate of 2.79%, and SoFi offers 2.77%. They’re evenly matched when it comes to the interest rates offered on almost all loan categories. However, ELFI requires individuals to have student debt of at least $15,000 before submitting to refinance. At the same time, SoFi will take on all balances starting from $5,000.

All student loan refinancing companies tend to offer their new members customer bonus programs. Both provide new customers with a $150 bonus and serve as an excellent incentive for users to pick between the two. However, the number that matters the most is the interest rate. SoFi has a slight edge in terms of the interest rates offered and their policy to accommodate balances as low as $5,000

SoFi Vs. ELFI Approval Rates

ELFI is a relatively newer lender, and that’s why it’s difficult to provide definitive statements regarding their lending policy. However, their reviews seem to indicate that ELFI is a fairly strict lender. They require potential borrowers to have high incomes and decent credit scores.

SoFi has been around for a long time and they’ve built up a reputation for being an organization with a stringent lending policy. Only individuals with high incomes and credit scores above 650 had a chance of getting their loan refinanced. However, in recent years they’ve been shedding that reputation. They haven’t changed the interest rates they offer but are expanding the pool of borrowers they accept.

All in all, both companies will require potential borrowers to have good credit scores and a high income. Applying with both companies is the best way to identify which one will offer the best rates.

Sofi and ELFI Perks

Not only do these companies offer their customers refinancing services, but they also provide consumers with different perks.

  • SoFi Job Placement – SoFi stands apart from other lenders because they actively help members look for jobs if they find themselves out of work. They employ a bold strategy that centers around the belief that assisting customers to find work is less costly than spending time chasing them to return the money.
  • ELFI Personal Loan Advisors – Many loan providers have customer service departments to help facilitate their members. However, ELFI stands apart because they provide each member with a personal loan advisor. Each member will get access to a direct number that will connect them to a single person who can address all their queries and issues.

Which Student Loan Refinance Lender Comes Out On Top?

When it comes to picking the best student loan refinance lender, there are a few things that potential borrowers need to remember.

Firstly, they should choose the lenders that provide them with the best loan terms. Flexibility and borrower protection are also essential aspects to keep in mind. Secondly, it’s vital to look at what fees they’ll have to pay the lender to refinance. The last thing that can help individuals decide what refinancing option they should pick is the additional perks the lender offers.

SoFi and ELFI are both very comparable in regard to the loan terms that each company offers. Neither charges an application or origination fee either. While both companies offer low-interest rates to high-income applicants, SoFi is increasing its borrower pool and is more accessible. Ultimately, choosing between these two companies depends on what loan terms they’ll offer. The best way to find out is to visit their respective websites and fill out the applications to get an estimate of the terms you’ll be offered!

Joshua Holt

Joshua Holt A practicing private equity M&A lawyer and the creator of Biglaw Investor, Josh couldn’t find a place where lawyers were talking about money, so he created it himself. He is always negotiating better student loan refinancing bonuses for readers of the site or finding honest companies that provide student loan advice for a fair price.

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