SoFi does a soft pull when checking the rates that a potential applicant qualifies for, which will not impact their credit score. SoFi does a hard pull for anyone who chooses to submit an application after checking their rates. This will cause a temporary credit score drop of a few points.
In all, you shouldn't worry too much about having a hard pull from SoFi, as the score damage should be relatively minor unless you've had multiple recent hard pulls. In general, it's best to wait at least six months between each hard pull.
A soft credit check shows the same information as a hard inquiry. This includes your loans and lines of credit as well as their payment history and any collections accounts, tax liens or other public records in your name. A soft credit check does not hurt your credit because it happens when … read full answeryou review your own credit report or a creditor does so for regular account maintenance or to pre-screen you for a credit card.
A hard credit check, on the other hand, is used when you apply for a new loan or line of credit. It can also happen when you ask for a higher spending limit on an existing account. A hard credit inquiry causes temporary credit score damage because it signals that you are trying to borrow more, and creditors need to see that you can handle the burden responsibly.
So to recap, hard and soft credit checks show the same thing. They just differ in terms of why they’re done and how they impact your credit score. For a more detailed breakdown, check out WalletHub’s Hard vs. Soft Credit Inquiries guide. You can also learn more about the soft side of things in particular from our article on Soft Credit Checks.
Personal loans affect your credit score in the short-term and in the long-term. In the short-term, a personal loan may damage your score because it causes a hard credit inquiry and increases your debt load. But in the long-term, a personal loan can either help or hurt your credit, depending largely on whether or not you pay the bills on time. Ultimately, it’s up to you how much impact the personal loan will have.… read full answer
How a Personal Loan Affects Your Credit Score:
Does temporary damage with an initial hard inquiry. When you first apply for a personal loan, your credit score will immediately take a small hit. That’s because applying for a personal loan triggers a hard inquiry into your credit history. But this shouldn’t drop your score by more than 5 points or so, and you should be able to bounce back quickly.
Adds to your overall debt. If you’re approved for a personal loan, you will immediately have a higher debt load, which may cause your credit score to drop in the short-term. That’s because the more debt you have, the riskier it is for banks and credit unions to lend to you.
Reports to the major credit bureaus monthly. The banks, credit unions and online lenders that issue personal loans report payment information to the major credit bureaus on a monthly basis. If you make on-time payments, you can expect your score to increase. But if you are late or don’t pay altogether, your score will drop.
Improves your credit mix. Proving yourself capable of managing multiple types of loans and lines of credit responsibly is good for your credit score. It shows you can be trusted to repay what you borrow in a variety of situations. So if you only have one or two other types of accounts on your credit report, such as credit cards or student loans, your score may benefit in the long run from getting the personal loan.
Could help reduce credit utilization. Personal loans give you a lump sum up front, which you pay back in monthly installments. This is different from a credit card, where you can borrow up to a certain amount any time you want. Credit cards are known as “revolving credit,” and a big part of your credit score is how much of your revolving credit you use up each month, or your “credit utilization ratio.” Personal loans don’t count toward this ratio, so if you use them to pay off revolving debt, you can lower your ratio and improve your score.
In conclusion, as long as you’re sure to pay on time each month, a personal loan should eventually increase your score by a lot more than the initial inquiry caused it to fall. You can also avoid wasting hard inquiries by getting pre-qualified for a loan first. Pre-qualification only uses a harmless soft inquiry. And while it doesn’t guarantee approval, it will let you know if your odds are good.
SoFi offers debt consolidation loans of $5,000 to $100,000 for 3 to 7 years with APRs range from 5.99% to 19.63%, assuming an autopay discount of 0.25%. In addition, SoFi charges no origination fee, no late fee and no penalty for paying the loan off early. All of these factors combined make SoFi debt consolidation loans among the best on the market.… read full answer
Still, it is worth noting that these terms are no different than those offered with SoFi’s other personal-use loans. Even though SoFi’s website has a page specifically for debt consolidation loans, they don’t actually seem to be a fundamentally different product.
Unlike some other lenders, SoFi does not offer any alternative ways to consolidate debt, such as home equity loans or credit cards.
How to Get a SoFi Debt Consolidation Loan
The first step toward consolidating debt with SoFi is to check for pre-qualification online. You’ll need to make an account on SoFi’s website, but then you’ll be able to see your odds of approval and an estimate of what your APR might be if you’re approved. That way, you can see if you’re likely to get rates that are lower than the ones on your existing debt.
If you’re pre-approved for a SoFi debt consolidation loan, you may want to also use WalletHub’s pre-qualification tool to check your status with other lenders. That will ensure you get the best deal.
If you decide that SoFi is the best option, you can then submit an application. Keep in mind you will need at least a 680 credit score for final account approval.
You should receive a decision in 2 to 4 business days, though it could take up to 15 business days if you’re self-employed. Once you get your money, you can use it to pay off your old debts, consolidating all of them into one loan owed to SoFi.
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