SoFi is the largest lender in the market and focuses primarily on student loan refinancing. LendingClub is known as a peer-to-peer lending platform. These leading companies provide various financial services, including personal loans. To choose SoFi or LendingClub, it is important to refer to the comparison of key aspects.
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Check your personal loan rates
SoFi vs LendingClub: a Comparative Chart
| SoFi | LendingClub | |
|---|---|---|
| APR Range | 7.99 - 23.43% | 8.3 - 36% |
| Term | 24 - 84 months | 36 - 60 months |
| Loan amount | $5,000 - $100,000 | $1,000 - $40,000 |
| Min Score | Good (670-739) | Poor (300-579) |
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How to choose between SoFi & LendingClub
Payment flexibility
SoFi
SoFi offers a personal loan with a wide range of loan repayment terms. The ability to choose a shorter or longer loan period simplifies the process by allowing the borrower to determine the appropriate monthly payment depending on the budget. Since the company offers a much larger loan than a competitor, this factor is especially significant.
SoFi is ready to support the borrower in case of involuntary job loss through the Unemployment Protection Program. According to its terms, it is allowed to defer payments on the loan for 3 months. It can be extended in increments of three months, not exceeding one year during the entire loan term. Deferral for a personal loan extends the repayment period of the loan. The company also offers a career development strategy, including individual consultation with a career coach, personal branding and job search advice.
LendingClub
LendingClub has less variability of loan repayment terms when it comes to the shortest and longest loan periods. In terms of payment flexibility, the lender is inferior to the competitor. The LendingClub personal loan is the best option for smaller loan amounts. You can also find other types of LendingClub personal loans on our website.
Terms
SoFi
A candidate for a personal loan needs to know about the following parameters:
- the loan repayment period is 24 - 84 months;
- the loan amount provided is in the range of $5,000 - $100,000. The available minimum loan amount may exceed this amount in some states due to legal requirements;
- the lender does not charge any origination fee, fee for late payment or prepayment. There are no hidden fees. In accordance with the terms of the agreement, the borrower is obliged to pay only the principal amount and interest;
- the requirements for the minimum credit score are remain unknown, but this indicator can significantly affect the company's decision on its readiness to provide a loan with certain conditions or rate;
- rates (APR) range from 7.99 - 23.43%, depending on the selected loan term. SoFi provides a discount of 0.25% when the customer chooses automatic payment.
To qualify for a loan, a potential borrower must meet a number of requirements. The main ones relate to US citizenship, permanent residence in the country or non-permanent residence with an appropriate visa. The candidate must be of legal age (18 years or older) at the time of application and reside in one of the relevant states. In the case of permanent residence, he must be ready to show an image or a scan of a Green Card with a validity period of more than 2 years. The same rules apply to visa holders. They should be able to provide an image or scan of the document, as well as confirmation of an approved application for an identification card.
The eligibility of a loan directly depends on factors such as financial history, the ratio of income and expenses, credit score and professional experience.
The company allows customers to qualify for multiple loans except for Michigan residents.
LendingClub
The peer-to-peer lending platform puts forward the following loan terms:
- the loan repayment period is from 36 - 60 months;
- the available loan amount reaches $1,000 - $40,000;
- the company does not provide any fees for applying for a loan or prepayment. However, the origination fee is 3 - 6% of the total amount of the selected loan and is set depending on the borrower's credit score;
- the minimum credit score is not disclosed, but high indicators allow customers to qualify for more favorable conditions, such as low interest rates;
- the annual range is 8.3 - 36%. Like its competitor, LendingClub includes an automatic payment option.
If the previous lender does not charge a fee for late payments, then LendingClub provides its customers with a 15-day grace period without penalties. If the monthly payment is not received during this period, the borrower is forced to pay $15 or 5% of the payment amount for the delay.
The lender allocates a similar list of requirements that the borrower must meet. The person must have US citizenship, be a permanent resident of the state or the owner of a valid long-term visa. He must be of legal age, at least 18 years old.
In addition, credit score, credit activity and history, debt-to-income ratio, information provided by credit bureaus and some other factors are taken into account.
The loan application process comparison
SoFi
The process of reviewing an application for a personal loan usually takes no more than 2 business days. A longer period of 2 - 4 days may be required if the borrower is self-employed or has an income that requires additional verification.
The application is reduced to the following steps:
- registration on the company's website with personal data, state of residence and email;
- choice of the preferred loan amount and intended use category;
- providing answers to questions in order to confirm the identity of the borrower and establish his ability to manage capital rationally.
To verify the compliance of the loan conditions with the borrower's request, the company conducts a soft credit check, which does not affect his credit score. If the choice in favor of a loan product has already been made and the application continues to be submitted, SoFi requests a full credit report from specialized agencies. This can have a significant impact on the credit score.
LendingClub
Most of the applications complete their review within a few hours. However, the exact time depends on the borrower's unique data, such as his creditworthiness.
Applying for a loan from LendingClub involves several steps:
- checking the rate on the official website of LendingClub;
- selection of the most appropriate loan offer;
- filling out an online application with verification of personal information, including social security number, income and employment;
- entrance to the Membership Center and waiting for a decision.
Sometimes it is recommended to add a co-borrower to qualify, as a joint application can lead to a positive loan decision.
When checking the rate, the lender performs a soft credit check that does not affect the borrower's credit score. If the application continues, a hard credit check begins with the opposite trend.
Which has a better reputation?
SoFi
At the moment, the company does not have an impeccable reputation, despite an A+ rating from the Better Business Bureau. The main complaints are related to the complicated application process and qualification requirements. The rating on the Trustpilot service is also characterized by a very low average score.
LendingClub
The rating of the financial services company on the Trustpilot and on the official website is 4.8 out of 5 stars. The analysis of comments indicates the satisfaction of the majority of customers with the services provided. As a rule, there is a simple and clear application process, quick receipt of funds upon loan approval and the quality of customer service in general.
When is SoFi Better? / When to choose LendingClub?
The LendingClub vs SoFi comparison reveals the advantages of both companies.
It is worth paying attention to SoFi when the client:
- wants to get a large loan amount;
- claims low competitive rates and complete absence of fees;
- needs flexible payment terms;
- seeks to protect himself with Unemployment Protection, as well as take part in career coaching and get recommendations on the topic of finance.
Check SoFi personal loan rates
LendingClub will be the best option when the borrower:
- needs a small amount of credit;
- seeks to get faster funding without fear of a high APR range;
- wants to add a co-borrower and submit a joint application.
Check LendingClub personal loan rates