When you’re ready to buy a house and need a home loan, a mortgage broker can help you shop for a mortgage, or you can go straight to a direct lender such as a bank or credit union and get the mortgage on your own.
Which way of shopping for a mortgage is better? If you have credit issues or other needs, using a broker to see an array of options might make sense. But if your financial health is solid and you want to save time and money, applying with a direct lender could be a good course of action.
In any case, it’s smart to get a few quotes and compare offers for the same type of loan and term.
What Is a Mortgage Broker?
A mortgage broker is like a personal shopper for home loans and serves as an intermediary between the mortgage seeker and lenders, including banks, credit unions, and private mortgage companies.
With a single application, a broker will provide you with access to different types of mortgage loans and, if you choose one, will walk you through underwriting.
Mortgage brokers are licensed and regulated. You’ll want to ensure that any broker you’re interested in working with is credentialed by checking the Nationwide Multistate Licensing System & Registry consumer access site. You can also check platforms like the Better Business Bureau and Yelp to see what past clients say.
Brokers are compensated by the borrower or lender. Borrower fees typically range from 1% to 2% of the total loan amount. Lender commissions may range from 0.50% to 2.75% of the total loan amount, but lenders usually pass the costs on to borrowers by building them into the loan.
How to Find a Mortgage Broker
You could ask your current lending institution, friends, family members, or real estate agent for a referral to a mortgage broker. After checking licensing, you may interview more than one broker before deciding on one. You might want to ask about their fees, lenders they work with, and experience.
First-time homebuyers can
prequalify for a SoFi mortgage loan,
with as little as 3% down.
What Is a Direct Lender?
In the mortgage broker vs. lender dichotomy, a direct lender is the bank, credit union, or mortgage company that originates, processes, and funds mortgages.
Mortgage loan officers, processors, and underwriters work for the company. Loan originators usually work on commission.
A loan officer may offer a mortgage at various price points, from a loan with discount points for a lower rate to a no-closing-cost loan, which is when the lender agrees to pay the closing costs in exchange for a higher interest rate.
Most people have a relationship with a bank or credit union, so you can always start by getting a quote there. But there are myriad online mortgage lenders and it’s worth considering these options. Pulling up the day’s mortgage rates online will conjure a list of direct lenders advertising their rates.
What Are the Pros of Working With a Mortgage Broker?
Because they are able to offer a variety of quotes from different sources, brokers can be useful if you’re looking to easily compare mortgage options.
They may offer specialized loans, and because loan brokers set their own profit margins, negotiating could be easier.
A broker could be useful if you have concerns like a fair or bad credit score or student loan debt.
What Are the Cons of Working With a Mortgage Broker?
Brokers may have preferred lenders that don’t necessarily offer the best interest rate. If paid by lender commission, a broker could be tempted to steer a borrower to a more expensive loan.
If paid by lender commission, a broker could be tempted to steer a borrower to a more expensive loan.
Brokers’ loans may take longer to close.
Broker fees tend to be higher, but that could be because the mortgages offered are sometimes more complex. And mortgage brokers may charge borrowers directly (the fee of 1% to 2% of the total loan amount).
What Are the Pros of Working With a Direct Lender?
By working with a direct lender, you’ll skip the broker fees, and you may get a better rate with lower closing costs (although both lenders and brokers can offer “rebate pricing” — a higher interest rate in exchange for lower up-front costs).
A direct lender typically does all the loan processing, underwriting, and closing in-house.
You may be able to negotiate underwriting or origination fees.
What Are the Cons of Working With a Direct Lender?
Comparing rates and terms on your own from a sample of lenders takes time.
You’re limited to the loan programs of the institutions where you decide to shop.
Once you’ve found a home and your offer has been accepted, it’s decision time on a lender. You are not required to stay with the lender you used for pre-approval.
If you have a sparse credit history, subpar credit, or other challenges, a mortgage broker might be able to find a loan program that’s a good fit.
But if you have solid credit, a strong income, and assets, you may be able to save time and money by working with a direct lender.
What about rates? In weighing mortgage broker vs. bank, there might be no difference to speak of. The rate you’re offered depends more on your qualifications than on the lender.
The mortgage loan process can seem mysterious, and a broker or a loan officer at a direct lender can act as a loan seeker’s guide.
That guide should be willing to answer all of your mortgage questions, including those about points, fees, mortgage insurance, and the closing timetable.
You’ll receive loan estimates after applying. When comparing mortgage offers, it’s important to look at more than the interest rate. Be sure to compare annual percentage rates, or APRs, as well.
Look at the fees in the “loan costs” section, and compare closing costs.
Gain home-buying insights
with the latest housing
market trends.
The Takeaway
If you’re in the market for a mortgage, you might think the choice comes down to mortgage broker vs. direct lender. But you may get loan quotes from both and compare them. It’s called shopping, and a home is a rather important purchase. And as with any form of shopping these days, it’s easily done with a phone or computer, from the comfort of your couch.
Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.
SoFi Mortgages: simple, smart, and so affordable.
FAQ
Is it better to use a broker or a direct lender?
If you have a challenging credit score, or limited credit history, or other financial complexities, a broker might be the way to go. But if your finances are solid you may find going the direct lender to be the most cost-effective way to obtain a home loan.
Why use a mortgage broker instead of just going to a bank?
A mortgage broker can research possible rates from a wide range of lenders, which could save you time. And if you have a challenging financial situation or credit history, a broker might be able to steer you to a lender who will work with your profile.
Does a mortgage broker charge a fee?
Yes. A borrower may have to pay a mortgage broker’s fee of 1% to 2% of the loan amount. When the lender pays a broker a commission, it may range from 0.50% to 2.75% of the total loan amount and these costs are passed on to the borrower by being built into the loan.
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SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.
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Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility for more information.
*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
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Many people figure that paying bank fees is simply an unavoidable part of life. Recent surveys say the average American shells out anywhere from $167 to $288 per year in fees. But take note: Some or even all of those may be avoidable.
For many financial institutions, fees are a way that banks make money. They can help cover the cost of being in business, and they can also cover situations that require more of their team’s time (say, dealing with an overdrafted account).
However, these charges can become expensive for many customers, and they can eat away at any interest earned. That can foil a customer’s efforts to grow their wealth.
Next, learn about the specific fees that many banks assess and how you can lower or avoid them.
1. Monthly Maintenance Fees
One of the most ubiquitous fees banks charge for checking and savings accounts is the monthly maintenance or service fee. This is a fee you pay each month to cover the cost of account management and customer service. These fees typically run between $5 and $15 per month and are usually automatically deducted from your account.
How to avoid monthly maintenance fees: Some banks offer account holders ways to get these monthly service fees waived. Common waiver requirements include: maintaining a certain minimum monthly balance, completing a certain number of debit card transactions per month, or receiving a specified amount of money via direct deposit for each statement period.
2. ATM Fees
Both traditional and online-only banks typically offer a network of ATMs where you can make deposits and withdrawals free of charge. If you deposit or withdraw money at an ATM outside your bank’s network, however, the bank will typically charge you am atm fee. On top of that, the owner of the ATM will likely also tack on a charge. On average, total combined ATM fees run close to $5.
How to avoid ATM fees: To reduce how much you could pay in ATM fees, planning ahead might help. You could research locations of in-network ATMs and only make withdrawals there. Or use an ATM that’s in-network to get cash before you go shopping or out to eat at a cash-only location so you don’t have to use whichever ATM is nearby.
Here’s another idea for avoiding ATM fees: Many grocery stores and some big box stores will let you get cash back when you make purchases there. This could be another way to circumvent ATM fees.
3. Overdraft Fees
The average overdraft fee runs around $27.
How to avoid overdraft fees: Many banks offer overdraft protection as an add-on service. If you choose to opt in, the bank will allow transactions to go through, even if you don’t have sufficient funds in your account to cover them. Depending on the type of overdraft protection you sign up for, the bank may lend you the money to cover the overage, or they may pull funds from a linked account. This can avoid NSF fees, late fees, and bounced check fees, but can trigger an overdraft fee.
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4. Nonsufficient Funds (NSF) Fees
Nonsufficient funds (NSF) fees, also known as insufficient funds or returned item fees, can occur when a bank declines to make an electronic payment or cash a check that would bring your checking account to a negative balance. Instead, the transaction gets denied or returned unpaid and the bank will typically charge you an NSF fee (also known as a returned item fee). The average NSF fee is currently around $20.
If you don’t opt in to have overdraft protection on an account, banks typically decline, or bounce, the transaction if there aren’t enough funds to cover a transaction.
Besides the problems associated with a bounced check (that is, the payee not getting their funds), there is typically a returned item fee, averaging around $30 for each occurrence. And, unfortunately, sometimes a returned item fee can take an account balance to the point where another check may bounce, causing the situation to become increasingly worse.
How to avoid nonsufficient funds fees: Many banks allow you to sign up for text alerts that let you know when your balance has fallen below a certain level. When you get the alert, you can avoid making a debit card purchase that will overdraw your account. You can also quickly transfer funds to cover any impending automatic payments or outstanding checks.
5. Wire Transfer Fees
If you use your checking account to send or receive a wire transfer, you’ll typically pay a wire transfer fee. Fees vary by institution, but they are usually at least $20 for domestic transfers and $35 or more for international transfers. Some banks don’t charge you for incoming wire transfers (when someone sends you money), but others charge a wire transfer fee whether you are sending or receiving funds.
Checking Account Fee
Average Cost
Monthly maintenance fee
$5 to $15
Nonsufficient funds fee
$20
Overdraft fee
$26.61
Out-of-network ATM fee
$4.73
Paper statement fee
$2 per statement
International transaction fee
1% to 3% of the transaction amount
Wire transfer fee
$20+ for domestic; $35+ for international
Costs vary by institution. Checking accounts may also charge other fees, including account inactivity fees, early account closure fees, check ordering fees, and debit card replacement fees. Before opening a new bank account, always read the fee schedule closely.
How to avoid wire transfer fees: A few ideas on avoiding these fees, if your financial institution charges them: Ask your bank if they will waive the surcharge; in some cases, they may. Use a payment service like Zelle, or, if you often make and receive international payments, you might look into getting a multicurrency or foreign currency bank account.
6. Inactivity Fees
If you have a bank account that you don’t use often, you might get charged what’s known as an inactivity fee or a dormancy if it sits untouched for a while. There are varying state laws that specify when a bank must turn dormant funds over to the state, as a form of unclaimed funds. Dormancy fees try to trigger account holders into action so that this handoff of funds to the government doesn’t happen.
Inactivity fees can typically range from $5 to $20, and the amount of time that must elapse before they are assessed will vary.
How to avoid inactivity fees: To avoid these fees, it’s wise to only have as many accounts as you can frequently manage. If you have an account you barely use, it can be a smart move to close it and transfer any funds to an active account.
7. International Transactions Fees
If you travel outside of the U.S. and use your debit card to make a purchase or withdraw funds at an ATM, you may get hit with an international (or foreign) transaction fee. These fees are typically up to 3% of the purchase or withdrawal amount.
How to avoid international transaction fees: To help mitigate or avoid these bank fees (especially if you are a frequent traveler), you could check with your bank to see if it charges these fees. If it does, you might consider opening an account at a financial institution that doesn’t.
Also, perhaps your bank has affiliate banks in regions where you’re traveling, and you could withdraw from those ATMs without paying the additional international fees. You could also ask if your bank reimburses fees that you’ve paid.
You could exchange US dollars to foreign currency before you leave the country, perhaps eliminating the need for ATM withdrawals while traveling. Your bank might do this with no fees. However, then you do risk loss or theft of your funds.
Many banks have shifted to e-statements in an effort to reduce waste and save on printing and mailing costs. If you choose to receive paper statements for your checking account, you may get hit with a monthly surcharge, which is often around $2.
How to avoid paper statement fees: Switching to electronic statements can help you avoid monthly paper statement fees. Banks typically allow you to sign up for this option through their online banking platforms. If you prefer a paper format, you can always print out your e-statements.
How Are Checking Account Fees Changing Over Time?
Along with the rising cost of many consumer goods and services, many checking account fees have also increased in recent years. This includes monthly account maintenance fees and ATM fees, along with higher balances required to avoid the fees. But there is some good news: Two common checking account fees — overdraft and NSF fees — have been moving in the other direction.
According to Bankrate’s annual checking account and ATM fee study, the average overdraft fee in 2023 was $26.61, down 11% from $29.80 in the previous year. In that same time period, the average NSF fee dropped a full 25%, from $26.58 in 2022 to a record low of $19.94 in 2023.
Despite the drop in average amounts, overdraft and NSF fees are still charged by 91% percent of accounts and 70% of accounts, respectively, according to the survey.
The Takeaway
Many checking accounts charge fees for everything from keeping your account open to overdrafts to ATM usage. Fortunately, you can avoid many of these charges by keeping a certain minimum balance in your account, signing up for direct deposits, going paperless, or looking for a bank that charges lower, or no, fees for checking accounts.
Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.
Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.50% APY on SoFi Checking and Savings.
FAQs
Are there fees for checking accounts?
Yes, checking accounts often come with various fees, including monthly maintenance fees, overdraft fees, ATM fees, and fees for paper statements or nonsufficient funds. These fees vary by bank and can add up over time if you’re not careful. Some banks offer fee-free checking accounts, but these might have specific requirements like maintaining a minimum balance or setting up direct deposits.
How do you avoid checking account fees?
You may be able to avoid or minimize checking account fees by:
• Maintaining the required minimum balance
• Signing up for direct deposit
• Using your debit card a certain number of times per month
• Using in-network ATMs
• Opting for electronic statements
• Setting up low-balance alerts (to avoid overdraft and nonsufficient funds fees)
• Choosing a bank that offers fee-free checking accounts
What is the most common checking account fee?
The most common checking account fees include:
• Monthly maintenance fees (these may be avoidable by keeping a certain minimum balance or signing up for regular direct deposits).
• Fees for using out-of-network automatic teller machines (ATMs)
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.
SoFi members with direct deposit activity can earn 4.50% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate. SoFi members with direct deposit are eligible for other SoFi Plus benefits.
As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.50% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant. SoFi members with Qualifying Deposits are not eligible for other SoFi Plus benefits.
SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.50% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.
SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.
Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.
Interest rates are variable and subject to change at any time. These rates are current as of 8/27/2024. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet.
Our account fee policy is subject to change at any time. Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
Personal loans can help you cover large purchases and emergency expenses, but if you’re not a U.S. citizen, you may wonder if getting a personal loan is even an option. The good news is that it is possible for non-citizens to get personal loans. The bad news is that you may need to jump through a few extra hoops to get approved for financing.
Some lenders view non-citizens as higher-risk borrowers, since they could potentially leave the U.S. before repaying the loan in full. What’s more, they may have little to no credit history in the U.S. As a result, the process of getting approved for a personal loan may involve additional steps and requirements. Here’s what you need to know to get a personal loan as a non-citizen.
Types of Personal Loans for Non-U.S. Citizens
As long as you can meet a lender’s qualification requirements, you have access to a variety of different types of personal loans as a non-U.S. citizen. Below are some types of personal loans you can potentially take out.
Single tab with bullet (paste where the bullet should go)
• Secured personal loan: A secured loan requires you to provide collateral, such as a car or savings account, which the lender can claim if you default on the loan. Because this lowers risk for the lender, the minimum required credit score may be lower, and other lending criteria may be less stringent.
• Unsecured personal loan: This is the most common type of personal loan and doesn’t require you to provide collateral to back up the loan. However, the loan requirements tend to be stricter than they are for secured personal loans.
• An online personal loan: Online lenders tend to have less stringent personal loan requirements than traditional banks. However, rates tend to be higher.
Eligibility Criteria for Non-Citizens
While eligibility criteria for non-citizens seeking personal loans varies depending on the lender and the type of loan, here are some common factors that lenders consider.
• Credit score: There’s no universal minimum credit score for a personal loan, but many lenders like to see credit scores of at least 580. If you’re new to the country and don’t have a longstanding credit history or good credit score, it can hurt your odds of getting approved for a personal loan.
• Cosigner: Having a U.S. citizen or permanent resident cosigner can significantly improve your chances of getting approved. The cosigner’s creditworthiness provides additional security for the lender. However, the cosigner will be financially on the hook should you miss any payments.
• Residency status: While lenders legally cannot discriminate against you because of your national origin, they are allowed to ask you about your immigration and residency status, and to request proof of that status. Those with green cards (permanent residents) generally have a better chance of approval than those with temporary visas.
• Income and employment: Demonstrating a stable source of income and employment history reassures lenders that you will be able to repay the loan.
• Debt-to-income ratio: A high debt-to-income (DTI) ratio could mean that you’re financially squeezed and can’t afford to take on more debt. Lenders typically want to see DTI ratios that are below 36%. You might still get approved if you have a higher DTI but an income on the higher end or some savings stashed away.
• Shop for a lender. Not all lenders provide personal loans to non-U.S. citizens. You might need to expand your search beyond traditional banks to include credit unions and online lenders and platforms. Shopping around can help you find a lender that meets your particular needs and circumstances.
• Get prequalified. If a lender has a prequalification option, you can get a preliminary offer, which gives you an idea of the type of loan and rate you’ll likely get approved for after you officially apply. This typically requires only a soft pull on your credit, which won’t impact your score.
• Consider adding a cosigner or collateral. If you’re unable to qualify for the personal loan you want, adding a cosigner — preferably a U.S. citizen — to your application may increase your chances of getting approved or help you get a lower interest rate or higher loan amount. If you don’t want to use a cosigner, you may be able to improve your chances of approval by applying for a secured personal loan.
Alternatives to Personal Loans
If you find it hard to meet a lender’s personal loan requirements, or find your borrowing options are too expensive, here are some other ways you may be able to access funding.
Borrowing from Friends or Family
Getting a loan from someone close to you could allow you to borrow money at a low interest rate (or interest-free). If this is possible, you’ll want to put the agreement in writing, including the repayment terms. Just keep in mind that this type of loan, even if you pay it off in full and on time, won’t help you build your U.S. credit. And should you have trouble repaying the funds, it could strain your relationship.
Salary Advance
Some employers will let their employees borrow against their future earnings to cover a one-time emergency. If your employer offers this benefit, they might offer you anywhere from 50% to 80% of your net monthly pay ahead of schedule. The advance may be free of charge or involve a small fee or interest rate to cover the extra accounting required for advances.
Immigration Loan
You may be able to find a local credit union that offers loans specifically for non-citizens. These loans may have names like “dreamer loans,” “immigration loans,” or “DACA loans,” and are designed to help cover the cost of applying for citizenship and associated legal fees. However, you will need to become a member of the credit union.
It’s possible to get a personal loan even if you are not a U.S. citizen. However, you will likely need to navigate some additional requirements. It’s important to understand the types of personal loans available, make sure you meet the lender’s eligibility criteria, and prepare all the necessary paperwork.
To find a non-citizen personal loan with the best rates and terms, it’s a good idea to explore multiple lenders and compare their offers. If a traditional personal loan isn’t feasible, consider looking into a family loan, salary advance, or a credit union loan designed for non-U.S. citizens.
Think twice before turning to high-interest credit cards. Consider a SoFi personal loan instead. SoFi offers competitive fixed rates and same-day funding. Checking your rate takes just a minute.
SoFi’s Personal Loan was named NerdWallet’s 2024 winner for Best Personal Loan overall.
FAQ
Do you need an SSN for a personal loan?
While some lenders don’t require a Social Security Number (SSN), the credit bureaus have no other way to pull your credit file. So, in effect, you do need an SSN at this time.
Can a non-citizen have a credit score?
Yes, a non-citizen can have a credit score in the U.S. The consumer credit bureaus can create credit reports using your personal identifying information, such as your name and address.
If you’ve recently moved to the U.S., however, you may not have a U.S.-based credit report or credit score. If that’s the case, you may be able to build your U.S. credit by getting a secured credit card or credit-builder loan, or by becoming an authorized user on a family member’s or friend’s U.S. credit card.
Photo credit: iStock/courtneyk
SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.
Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .
The question of how student loan forgiveness would be funded doesn’t have a clear-cut answer, and ideas about how it would be paid for can be heavily influenced by a person’s political leanings. One recent survey found that the majority of Democrats support canceling some or all student debt, while most Republicans oppose any cancelation. Read on to learn more about this important issue.
Who Pays for Student Loan Forgiveness?
There’s no easy answer in terms of how plans to cut student debt would be funded. Government finance is complex. Typically, the federal government would need to foot the bill for student loan forgiveness, and the government would have two options to pay for it: cut spending or raise taxes. Making the situation more complicated is the fact that forgiven loans may have already earned a profit, which could make reconciling the impact of writing off this debt even harder.
In addition, viewpoints on student loan debt are often divided by political affiliation. Democrats are more likely to support debt cancellation and hold the government and lenders responsible for the high levels of student debt. Republicans, on the other hand, usually are against the idea of student loan forgiveness and often feel the borrowers themselves should shoulder some of the blame for the situation.
Spending Cuts and/or Higher Taxes
If some or all student loans were to be forgiven, here’s a closer look at some potential paths:
• Cutting spending, which can be challenging. Some financial and legal experts worry that cuts would wind up hurting education resources, such as universal pre-K and higher education initiatives. These could be trimmed to save money.
• Raising taxes, which could involve increasing individual income tax rates or reducing tax deductions, such as mortgage interest, charitable contributions, medical expenses, IRA contributions, and more. The government could also opt to raise taxes on corporations and the wealthy.
• A combination plan of the two methods: some tax cuts along with some tax hikes.
Neither Is Necessary
Another point of view to consider: Some pundits say that the cancellation of federal student loan debt won’t cost the government anything. They point to the fact that student loans were paid for by taxpayers when the funds were first disbursed.
They also hold that, over time, payments by borrowers of student loans to the Department of Education have almost been equal to the amount of money loaned out. In that way, they see the situation of forgiving loans as being close to break-even. One review found that the government collected about $85 billion a year in payments on about $95 billion a year in loans paid out. In terms of government spending, they believe forgiveness would not result in a major shortfall.
Proponents of this theory also say that records reveal that the Department of Education has been profiting on student loans over the years, and that gain can also be seen as an asset against which canceled federal loans can be compared.
Obviously, this is a complex issue with many different viewpoints regarding the best path forward.
It can be helpful to keep in mind the recent events surrounding student loan forgiveness.
• The Biden administration announced a $441 billion federal student loan debt relief program for borrowers who earned less than $125,000 ($250,000 for married couples) in 2022. This was blocked by the Supreme Court in 2023.
• Accrued and capitalized interest for certain borrowers
• Debt for those eligible for the Saving on a Valuable Education (SAVE) Plan, in the event of a closed school discharge, and other forgiveness programs
• Student loan debt for those who entered loan repayment 20 years ago
• Debt for those who enrolled in programs or institutions that provided low financial value
• Debt for those who experience repayment hardship
In May, the U.S. Department of Education announced cancellation of $7.7 billion for certain borrowers under Public Service Loan Forgiveness Program (PSLF) and through the SAVE Plan, which offers borrowers a shortened forgiveness period. However, court orders recently halted the SAVE program after several states sued.
Where Does All the Canceled Debt Go?
It’s hard to say where all the canceled student debt would go, and it’s also difficult to forecast how much forgiving debt would cost the government, if anything. The government would at least have to adjust its revenue projections, even when the original principal has been paid off with interest.
One important note: Canceled student debt can have a positive impact on borrowers. It gives them more disposable income, which they can use in ways that stimulate the economy, from buying more consumer goods to taking out more mortgages.
Will My Taxes Increase if Student Loans Are Forgiven?
Many believe that federal student loan forgiveness, as planned, could transfer debt from borrowers who took out student loans to taxpayers, according to the U.S. House Budget Committee. This is a viewpoint that tends to be held by Republicans who are opposed to forgiveness for various reasons.
The Budget Committee has stated that approximately 87% of adults without student loans will wind up paying for the 13% of borrowers who borrowed for college and 56% of the student loan debt for graduate degree borrowers.
Currently, some estimates say that $1 trillion in federal student loan cancellation would mean an additional $2,500 tax bill for most Americans.
Another angle to consider: If borrowers’ debt is forgiven, it could be taxable. Borrowers would receive IRS Form 1099-C in this instance, and might need advice from a professional tax preparer.
The Biden administration’s student loan forgiveness plans would not cancel private student loans, which come from private companies, including online banks. The forgiveness plans only apply to those with federal student loans, or loans that come from the U.S. Department of Education.
Unlike federal student loans, which borrowers apply for using the Free Application for Federal Student Aid (FAFSA), you can apply directly to the lender for a private loan. Unlike in the case of federal loans, you may need to undergo a credit check and may encounter less flexible repayment plans with private student loans.
However, private loan lenders may offer some benefits that are similar to those of federal student loans, including deferment (when borrowers can temporarily stop making payments and interest may not accrue), forbearance (when borrowers can temporarily stop making payments or make smaller payments and where interest does accrue), or unemployment protection.
It’s wise to check carefully with your lender to find out their exact policies.
Alternative Options for Paying Off Student Loans
Since the future of forgiveness is largely uncertain, borrowers can consider other ways to pay off student loan debt. They can take advantage of several alternative options, including putting extra toward principal, considering other repayment plans, making lump sum payments, and additional methods.
Here are several possible options:
• Put extra toward the principal: Putting extra cash toward your principal student loan can result in a faster payoff than by simply making your usual monthly payment. Putting an extra $100 toward your principal every month, for example, can make a difference. You will typically not pay prepayment penalties on private or federal loans, which is a charge that penalizes you from paying off your student loans early.
• Make lump-sum payments: If you have a lump sum, like a tax refund, a bonus, or other windfall money, you can put that toward your debt instead of spending it. If you can find extra money regularly (such as a couple of times a year), that could help you pay off your student loans. A side hustle can also help you make lump-sum payments as well.
You might also consider using the debt snowball method of taking care of your loans, which means you put money toward your smallest loan balance, then progress to larger loan balances after that.
• Check with your employer: Your employer may offer a student loan repayment benefit. Learn whether your employer will help pay for qualified educational expenses, including your student loan balance.
• Budget your money: Living on a budget is a great way to ensure you make on-time student loan payments. Though you’re shielded from penalties on late payments through September 2024 through an on-ramp period, it’s still good practice to avoid late payments so you don’t risk default later.
• Refinance or consolidate student loans: Refinancing means changing one or more loans to private student loans with a new interest rate, term, and monthly payment. Securing a lower interest rate means you’ll pay less interest over time. However, it’s important to be aware that refinancing federal student loans in this way means you will forfeit the right to certain benefits and protections, such as deferment. Also, if you refinance for a longer term, you may well pay more interest over the life of the loan.
• Consolidating federal student loans: This means pooling one or more federal student loans into a Direct Consolidation Loan with one monthly payment with one interest rate. You may save money over time when you consolidate, but check to be sure.
• Repayment plans: Several repayment plan options exist for both federal and private student loans. For example, with federal loans, you may look into several income-driven repayment plans, such as the SAVE, Pay As You Earn (PAYE), income-based repayment (IBR), and Income-Contingent Repayment (ICR) plans as repayment options. Check with your loan servicer to determine which makes sense for you, whether you have a mix of federal and private loans or just federal loans.
There are different opinions about how federal student loan forgiveness will be paid for, if and when it’s enacted. Viewpoints often align with a person’s political beliefs, with Democrats tending to favor loan cancelation and Republicans being against it.
Regardless of the future of student loan forgiveness, there may still be options to help you manage your student debt, such as budgeting, considering alternate repayment plans, or refinancing.
Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.
With SoFi, refinancing is fast, easy, and all online. We offer competitive fixed and variable rates.
FAQ
How will student loan forgiveness be funded?
Some experts claim that the government would need to cut spending or raise taxes to fund student loan forgiveness.
What impact will student loan forgiveness have on borrowers?
Pending legal blocks, borrowers could see some of their student loans disappear, providing relief for millions of borrowers. It’s also important to understand that student loan forgiveness may be subject to tax. You’d receive Form 1099-C to document it; consider checking with a tax professional to learn more about how tax applies in your situation.
What are the potential drawbacks of student loan forgiveness?
In addition to the potential for taxpayers to shoulder the debt, other downsides of debt forgiveness might include the forgiven amount being taxed, cuts to government educational spending, and overspending and increased debt for students who find themselves with more disposable income.
Photo credit: iStock/Drazen Zigic
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You may think of a bank as simply a safe place to put your money. But banks do a lot more than accept deposits. They also extend loans, facilitate payments, exchange currency, set monetary policy, and provide a range of other financial services to individuals, businesses, and governments. Here are key things to know about banks, including how they work, how they make money, and the different products and services they offer.
What Is a Bank?
By definition, a bank is an institution that accepts deposits in checking and savings accounts and makes loans. In serving both functions, banks act as intermediaries between depositors (who essentially lend money to the bank) and borrowers (to whom the bank lends money). The money the bank pays to depositors and charges on loans is called interest.
Banks also offer a range of other financial products and services, including:
Banks also facilitate payments — from employers to employees, buyers to sellers, and taxpayers to the government — and play a major role in the nation’s economy. There are also many different types of banks, including retail banks, corporate banks, and central banks.
• Interest on loans: Banks lend money to individuals and businesses at higher interest rates than what they pay on deposits, earning the interest rate spread.
• Fees: Banks may charge fees for various services, including account maintenance, overdrafts, wire transfers, and out-of-network ATM usage.
• Investment income: Banks may invest in securities, bonds, and other financial instruments, earning returns on these investments.
• Interchange fees: When customers use their debit or credit cards, banks earn fees from merchants processing the transactions.
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A Brief History of Banks
The concept of banking dates back to ancient civilizations, when temples were used as safe places to store valuable items and grain, and priests would lend these resources to local farmers and merchants. The temples were also responsible for keeping records of these transactions, laying the groundwork for bookkeeping.
The first modern banks emerged in Renaissance Italy, with institutions like the Medici Bank setting the standard for banking operations. Over centuries, banks evolved, expanding their products and services and adopting technological advancements to meet the growing demands of consumers and businesses. Today, banks are integral to the global economy.
Modern Bank Products for Consumers
Modern banks offer a variety of products tailored to meet the financial needs of consumers. Common banking products include:
Loans
Banks provide various types of consumer loans, such as mortgages, personal loans, and auto loans. These loans help individuals finance large purchases and manage their cash flow.
Savings and Checking Accounts
Savings and checking accounts are fundamental banking products. A savings account is designed to hold cash you don’t need right away and allow you to earn interest and grow your money over time.
Checking accounts are set up to offer easy access to funds for everyday transactions. They come with checks and typically a debit card that can be used for purchases or to withdraw funds at an ATM. Checking accounts generally earn little or no interest, though some banks now offer high-yield checking accounts.
Mortgages
Banks offer mortgage loans to help individuals purchase homes. These long-term loans typically come with fixed or variable interest rates and generally require you to use the property being purchased as collateral for the loan. Mortgage terms are typically 15, 20, or 30 years.
Investing Accounts
Many banks offer investment accounts, including IRAs and taxable brokerage accounts. These accounts enable customers to invest in stocks, bonds, mutual funds, and other financial instruments designed for long-term growth.
Credit Cards
Credit cards provide consumers with a revolving line of credit, allowing them to make purchases and pay for them over time. Banks earn interest and fees from credit card users, making it a significant revenue source.
Certificates of Deposit (CDs)
CDs are time deposits that offer a fixed interest rate for a specified term. You agree to leave your money in the account for a set period of time (which generally range from three months to five years). In return, these accounts typically pay a higher interest rate than a standard savings account.
Money Market Accounts
A money market account is a hybrid account that offers competitive interest on your balance, along with the conveniences of a checking account, such as a debit card and checks. However, you may be limited to a certain number of withdrawals per month. Some money market accounts also have minimum balance requirements.
Useful Bank Features
In addition to products, banks offer various services to help customers manage their money. Here are some features you may want to look out for when exploring different bank options.
Customer Support
Banks typically offer customer support through various channels, including phone, email, online chat, and in-person assistance. Whether you need assistance with your checking account or help choose between two banking products, a customer service rep can generally point you in the right direction.
Credit Score Checkers
Many banks offer tools that allow customers to monitor their credit scores for free. This service allows you to stay informed about your credit health and, if necessary, take steps to build your scores. Having strong credit can help you unlock credit cards, mortgages, and other types of loans with attractive rates and terms.
ATMs
Whether you open an account at a traditional brick-and-mortar institution or an online-only bank, you’ll typically have access to a wide network of fee-free automated teller machines (ATMs). This allows you to withdraw cash or make deposits without needing to visit a branch during business hours.
Online/Mobile Banking
Online banking and mobile banking apps allow you to monitor your accounts, transfer money, pay bills, and deposit checks from your computer or mobile device.
Financial Planning Tools
Many banks offer financial planning tools that help customers budget, save, and invest wisely. These tools can include calculators, goal-setting features, and personalized financial advice.
Bank Regulations
While banks are typically privately owned entities that must answer to their shareholders, banking is a highly regulated industry. Regulatory bodies, such as the Federal Reserve, Federal Deposit Insurance Corporation (FDIC), and Office of the Comptroller of the Currency (OCC), oversee banks’ operations, ensuring they adhere to laws and maintain sufficient capital reserves. This is to minimize disruptions and ensure the U.S. banking system runs smoothly.
The majority of U.S. banks are also insured by the FDIC. This covers deposit accounts up to $250,000 per insured bank, per depositor. Co-owners of joint accounts at the same bank are typically each insured up to $250,000. The agency’s BankFind site can help you identify FDIC-insured banks throughout the country.
Types of Banks
There are several different types of banks, each serving different purposes and customer bases. The large global banks often operate separate arms or divisions for each of these categories.
Retail Banks
Retail banks focus on individual consumers, rather than businesses or other banks. They provide personal banking services, such as checking and savings accounts, personal loans, mortgages, auto loans, short-term loans like overdraft protection, and credit cards. They may also offer access to investment products, such as mutual funds and IRAs.
While some retail banks offer in-person services through brick-and-mortar locations, others operate exclusively online. Due to lower overhead costs, online banks tend to offer higher yields on savings accounts and charge lower (or no) fees.
Corporate banks (also known as commercial banks) cater to large businesses and corporations. They also serve government agencies and institutions like colleges and universities. Along with business checking and savings accounts, these banks offer business loans and lines of credit, letters of credit, payment processing, foreign exchange transactions, and more for their clients.
Investment Banks
Investment banks serve as intermediaries in large, complex financial transactions. They specialize in initial public offerings (IPOs), raising capital, facilitating mergers and acquisitions, and providing advisory services to corporations and governments. Unlike retail banks, they do not take deposits from or provide loans to the general public.
Central Banks
Central banks manage a nation’s monetary policy, regulate the banking industry, and act as a lender of last resort. The central bank in the U.S. is the Federal Reserve (a.k.a, “the Fed”). The Fed sets the federal funds rates, which impacts everything from the annual percentage yields (APYs) you earn on savings accounts to the interest rates you pay on credit card balances and loans. Unlike the banks types listed above, central banks do not deal directly with the public.
Pros and Cons of Banks
Retail and commercial banks offer myriad benefits, but they also have some downsides. Here’s a look at how the pros and cons stack up.
Pros
Cons
Safe and secure
Potential fees for various services
Easy access to funds
Lower interest rates on deposits
Wide range of services
Potentially complex fee structures
Highly regulated
Potential for poor customer service
Pros
• Safety: Banks provide a secure place to store money, reducing the risk of theft or loss. Deposits in most banks are federally insured (up to certain limits), which means that even if the bank were to fail, customers will still recover their funds, up to the insured limit.
• Convenient access to funds: Banks offer easy access to funds through a network of branches, ATMs, and digital banking platforms.
• One-stop shop: Banks provide a variety of financial services beyond basic checking and savings accounts, allowing you to manage all aspects of your finances under one roof.
• Regulatory protection: Banks are heavily regulated by government agencies. These regulations protect consumers from fraud, ensure the safety of deposits, and promote ethical banking practices.
Cons
• Fees: Banks often charge fees for their services, including fees for account maintenance, overdrafts, and wire transfers.
• Low interest rates: Many banks offer relatively low interest rates on savings accounts and other deposit accounts. These rates often fail to keep pace with inflation, which can diminish the purchasing power of your savings over time.
• Complex fee structures: The complexity of bank fees can create confusion for customers and result in unexpected expenses.
• Potential for poor customer service: Large banks may offer impersonal or poor customer service due to their size and scale.
Banks vs Credit Unions
While banks and credit unions offer similar financial services, there are key differences between them. Here’s a closer look:
Ownership
Banks,typically, are owned by shareholders and operate for profit. Credit unions, by contrast, are owned by their members and operate on a not-for-profit basis. The main goal of a credit union is to benefit its members.
Fees and Interest Rates
Credit unions often offer lower fees and better interest rates on loans and savings accounts compared to traditional banks, as they are not driven by maximizing profits.
Membership
Banks are open to the general public. Credit unions require membership, which may be based on specific criteria such as employment, geographic location, or affiliation with a particular organization.
Customer Service
Credit unions tend to provide more personalized customer service due to their smaller size and member-focused approach. While small banks can also offer personalized customer service, larger banks may lack the personal touch.
Getting Started Banking With SoFi
A bank is an excellent resource to help manage your money. You can deposit funds for safekeeping, manage everyday spending, and invest for the future. Understanding the products, services, and perks offered by different banks can help you find the institution for your needs.
Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.
Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.50% APY on SoFi Checking and Savings.
FAQ
How do banks make money?
Banks primarily make money by lending out deposits at higher interest rates than they pay to depositors, earning the interest rate spread. They also earn money from the fees they charge for account maintenance, overdrafts, and transactions. Additionally, banks may invest in securities and earn returns.
Why do they call it a bank?
The term “bank” is thought to originate from the Italian word “banca,” which means bench or counter. In medieval times, moneylenders conducted their business on benches in marketplaces, and the term evolved to represent financial institutions.
What is a bank, simply put?
Simply put, a bank is a financial institution that accepts deposits and makes loans. Banks also play a key role in a nation’s economy, facilitating the management and movement of money for individuals, businesses, and governments.
SoFi members with direct deposit activity can earn 4.50% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate. SoFi members with direct deposit are eligible for other SoFi Plus benefits.
As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.50% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant. SoFi members with Qualifying Deposits are not eligible for other SoFi Plus benefits.
SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.50% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.
SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.
Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.
Interest rates are variable and subject to change at any time. These rates are current as of 8/27/2024. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet.
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .
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