Recently we've been going through the process of purchasing a new home. Getting a mortgage is a huge part of the process, and in a competitive housing market, having a great lender is essential.
SoFi (typically known for its student loan refinancing) has recently gotten into the mortgage space with SoFi Mortgage. As a millennial, I like to do everything with applying for a loan online - so that's why I was definitely shopping around for online mortgage lenders. Given SoFi's reputation for making student loan refinancing easy, I thought they would make the mortgage process easy.
Here's my review of SoFi Mortgage, and how they handled the process of getting pre-approved and starting the lending process. I strongly recommend everyone shopping for a mortgage compare multiple lenders. Using a service like LendingTree can make that really easy.
SoFi Mortgage Products
SoFi Mortgage offers all of the mainstream lending products you'd expect at a typical lender. They offer 15 and 30 year fixed rate mortgages. They also offer 5/1 and 7/1 ARMs.
They also have options for 10% down with no borrower PMI (private mortgage insurance).
Their application process is so easy that they advertise that you can get your rate in 2 minutes.
Getting Started With SoFi Mortgage
SoFi Mortgage makes the process of applying for a mortgage online really easy. In just a few simple fill-in forms, you can quickly get your interest rate and what products you might potentially qualify for.
Quick And Easy Online Pre-Qualification
Once you fill out all the information, SoFi Mortgage will confirm that you're allowing them to run a credit check, and then you can get a pre-qualification letter.
Remember, a pre-qualification letter is NOT a pre-approval letter. The difference is in the level of depth the company is going into your financial history, and the level of commitment from the lender to loan you the money.
A pre-qualification letter is very high level - your self-reporting information and your credit check are pretty much all you need. With a pre-approval, you typically have to finish the mortgage application, provide proof of all your income, assets, and liability, and have a conditional sign off from underwriting. It's a much more involved process.
After filling out the online application, we received our pre-qualification letter via email in minutes.
The Rest Of The Process Was Not As Smooth
The problem is, in a competitive housing marketing, a pre-qualification just doesn't cut it for some realtors. They want to see the proof you're able to get a mortgage - it simply makes a stronger offer. And this is where SoFi Mortgage started to drop the ball.
Everything in their online process was great, until this point. Because after you get pre-qualified, everything reverts offline for the most part.
To get pre-approved, you have to provide proof of all your income, assets, and liabilities. This means providing things like bank statements, W-2s, tax returns, and more. SoFi does make it easy to upload these documents, but the system sometimes gets confusing to use.
After you upload all your documents, you wait...
Sadly, we had to wait too long to get into contact with a loan officer from SoFi to proceed with them. After we submitted our information, and I uploaded all the documents, it took about 3 days before someone from SoFi reached out to even work on the pre-approval.
As such, we didn't move forward with them - we had tight deadlines to meet to get our house.
Overall Thoughts On SoFi Mortgage
Based on our experience with SoFi Mortgage, they have a lot to offer. They offered competitive rates on their loans, and the up-front 10% down potential is nice for buyers who don't want to spend all their cash on a property.
However, given the fact that their online system only goes so far, and that it took days to move from pre-qualified to pre-approved, we recommend that any home buyers looking to move quickly look at another lender.
Check out LendingTree to compare different lenders with one application. We like putting multiple lenders against each other and make them fight until the very end.
SoFi Mortgage Review
SoFi Mortgage is an online lender that has an excellent pre-qualification process, but everything else is very traditional. Combine that with minimal loan choices, higher rates, and poor customer service, and this isn't a lender I would recommend.