The lender’s Personal Loans channel has facillated more than $5bn of credit card debt refinancing.
US marketplace lending giant SoFi has reached a milestone with more than $5bn dollars in credit card debt refinanced via its SoFi Personal Loans.
While the firm is most widely known for its student loan refinancing, SoFi has been expanding into new verticals of late such as consumer loans and auto financing.
The firm said that borrowers who have used SoFi Personal Loans to pay off credit cards reduced their effective interest rate by 42 per cent on average. They also saw their credit scores rise by 17 points on average due to reduced credit utilization, a key component of credit scores.
“Credit cards offer great convenience and rewards, but there are better forms of financing for longer-term debt,” said Meron Colbeci, SVP of Product at SoFi. “If you’re carrying a balance, you owe it to yourself to look at a Personal Loan to pay off those cards.”
Credit card use has been steadily rising since the 2008 financial crisis with total US credit card debt moving beyond $1 trillion this year, according to Federal Reserve data, and the average credit card APR inched up to an all-time high of 16.14 per cent, according to CreditCards.com.
SoFi offers borrowers who meet its strict criteria up to $100,000 with terms of three, five, or seven years .Though SoFi Personal Loans can be used for lots of purposes, more than 70 per cent of SoFi borrowers – or members as it likes to call customers – report using them for credit card refinancing and loan consolidation.
Like all SoFi ‘members’, SoFi Personal Loan borrowers gain access to an array of benefits and services, including career counseling, invites to SoFi member events in over 60 cities around the Unites States, and rate discounts on other SoFi products.