Unquestionably, SoFi and Discover are prominent personal loan lenders in the landscape of personal loan lending. Meanwhile, choosing the right lender for your needs can affect your financial well-being significantly. Both lenders provide special features and benefits designed to meet the needs of different borrowers. SoFi vs. Discover: which personal loan lender is right for you?
SoFi is well-known for its member benefits and competitive rates. This makes it an excellent choice for borrowers looking for a smooth digital experience and extra perks or benefits. Conversely, Discover is also popular in the financial world and provides excellent customer support, flexible terms, and an easy approach. In this comprehensive blog post, we will be finding out which is a better choice between SoFi and Discover personal loans.
SoFi Personal Loans
SoFi vs. Discover – Which Personal Loan Lender Is Right for You – SoFi, also known as Social Finance is an American online personal finance company and online bank. Furthermore, they provide personal loan services for different purposes like home improvement, large purchases, and debt consolidation.
Features and Perks
Here are the features and perks SoFi personal loan borrowers can enjoy:
- Unemployment protection
- Flexible payment date.
- No prepayment, late, or origination fees.
Eligibility Requirements
To be considered eligible to take out a SoFi personal loan, here are the requirements you need to meet:
- Must be a U.S. citizen.
- Minimum credit score of 650.
- Graduating or attending a qualified school.
- You must be at least 18 years old.
- Stable income.
- Low debt-to-income ratio.
- Proof of employment.
Pros and Cons
Here are the pros and cons of applying for SoFi personal loans:
Pros
- Adjustable repayment terms.
- Large loan amounts.
- Instant application process.
- No fees.
- Competitive rates.
- Co-signers are allowed.
- Unemployment protection.
- Financial planning tools and resources.
Cons
- No secured loan options.
- Limited customer support.
- High credit score requirement.
- Employment requirements.
- Required income verification.
- Restricted availability.
- Variable rates.
- Less transparency.
Discover Personal Loans
Provided by Discover Financial Services, Discover personal loans are designed to help borrowers with access to funds for multiple purposes. In other words, you can use a Discover personal loan for major purchases, debt consolidation, home improvements, and other associated personal expenses. These loans come with benefits and features that also meet various borrowing needs.
Features and Perks
Here are the features and perks of Discover personal loan:
- Direct payment to creditors.
- Swift disbursement.
- Credit scorecard.
Eligibility Requirements
To be considered qualified to take out a Discover personal loan, here are the requirements you need to meet:
- Physical address.
- Minimum credit score of 660.
- Low debt-to-income ratio.
- U.S. citizenship or permanent residence.
- An active email address.
- Borrowers must be 18 years old.
- Must have $25,000 in annual household income at least.
Pros and Cons
Here are the pros and cons of applying for Discover personal loans:
Pros
- Handsome loan amounts.
- No origination fees.
- Educational resources.
- No prepayment penalties.
- Flexible repayment terms.
- Competitive rates.
- Multiple use.
- Rewards on cashback.
Cons
- Limited loan amounts.
- High credit score requirements.
- Variable rates risk.
- Higher APRs.
- Limited availability.
- Rigid income verification.
- Cosigning is not allowed.
- No secured loans.
SoFi vs. Discover – Which Personal Loan Lender Is Right for You?
Here is a table illustrating the differences between SoFi and Discover personal loans and which area they will be a suitable choice for your needs:
| Feature | SoFi Personal Loan | Discover Personal Loan |
| Minimum Credit Score | 680 | 680 |
| Debt-to-income Ratio | Preferred low | Preferred low |
| Interest Rates | Fixed | Fixed and Variable |
| Quick Application Process | Yes | Yes |
| Age | At least 18 years old | At least 18 years old |
| Income Requirement | Required proof of stable income | Required proof of stable income |
| Citizenship Requirement | U.S. citizens or permanent residents | U.S. citizens or permanent residents |
| Repayment Terms | 2 to 7 years | 3 to 7 years |
| Credit History | Solid credit history | Good credit history |
| Co-Signer Option | Cosigner is allowed | Cosigners are not allowed |
| Limited Availability | Not available in all states | Not available in all states |
| Secured Loan Options | Not Available | Not Available |
| Customer Support | Limited | Limited |
| Income Verification | Strict | Strict |
| Financial Resources | Access to financial planning resources and tools | Access to educational tools and resource |
In Summary:
SoFi is a better choice for borrowers who are interested in taking out a larger loan amount and value extra benefits such as unemployment protection. Additionally, it lacks flexible terms and fees which is a good advantage. However, if you need a secured loan or have a low credit score, it is not the best choice.
On the other hand, Discover has no fees and competitive rates, therefore, if you need an easy borrowing process and a small loan amount, Discover is a good choice. However, they offer higher rates for borrowers with low credit scores and do not offer co-signer options.
Final Thoughts
Both personal loan lenders provide competitive loan products with special features. Discover is known for its competitive rates and lack of fees. On the other hand, SoFi is known for its extra benefits and high loan limits. Hence, selecting a suitable lender depends on your personal preferences, credit profile, and loan amount needs.