Nov
08
2024

What Is a Cardholder Name?

By | Financial Independence, money, Terminology | Comments Off on What Is a Cardholder Name?

A cardholder name is the name of the account holder or authorized user, printed or embossed on a debit or credit card. It helps ensure that transactions are linked to the correct account. However, it may not be the same as the individual’s legal name.

While it is typically no longer common for a merchant to verify a cardholder name with a person’s identification, many merchants do reserve the right to refuse a purchase if the name on the card does not match a person’s actual name. Learn more about cardholder names and the role they play in your financial life.

Key Points

•   A cardholder name is the name of the account holder or authorized user embossed or printed on a debit or credit card, linking transactions to the correct account.

•   It may differ from the legal name due to typos or name variations, but it can be important to have that corrected.

•   Merchants can refuse purchases if the cardholder name doesn’t match the ID.

•   Cardholder names are crucial for aligning transactions with accounts.

•   Name changes or misspellings can be corrected by contacting the bank for a new card.

Definition and Importance of Cardholder Name

When you open a bank account, you will enter your personal information, including your legal name, as part of the account opening process. Depending on the type of account that you open, your bank may send you a credit or debit card to more easily make transactions on your account. In most cases, the name on your account will be embossed or printed on your card — this is referred to as your cardholder name.

While most of the time, your cardholder name is also your full and legal name, that is not always the case.

•   You may use a nickname (say, Jon Smith vs. Jonathan F. Smith) or other variation of your name. For instance, people with a hyphenated last name may not use both of those names.

•   In some cases, you may change your name after opening the account (often in cases of a marriage or divorce).

•   It may be that you made a typo or misspelled your name when you opened the account. (You can typically correct that and have a new corrected card issued to avoid problems.)

In most cases, with bank accounts and credit card accounts, you must use your legal name. This is part of efforts to prevent bank fraud and money laundering. That said, in some instances, you may be able to use, say, a preferred first name vs. your legal first name.

What’s more, merchants do reserve the right to deny a purchase if there’s a mismatch between the name on the card and a person’s name (say, on their ID) when they are using a debit card or a credit card.

For these reasons, it can be a wise move to make sure your cardholder name matches your legal name.

Cardholder names are important because they help align the transactions made with your card and your account, whether that may be your checking account (in the case of a debit card) or your line of credit (with a credit card).

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Where to Find Your Cardholder Name

The most obvious place to find your cardholder name is on the front of your credit or debit card itself. It is often embossed (or raised), but many cards today show the cardholder name with the letters printed vs. being raised.

If you have lost your card or don’t have immediate access to it and want to check your cardholder name, you may also be able to find it in your online banking account.

Common Issues With Cardholder Names

While it’s common for a cardholder’s legal name to be their cardholder name, there are a few times when this might not be the case.

Misspellings and Variations

Occasionally you may apply for a new credit or debit card with a variation of your full legal name. You may also make a typo on your application, causing the bank to send you a card with a misspelling of your name. While technically you may be able to use your debit or credit card with a name that is not your full and legal name, it’s wise to contact your bank or financial institution to get a replacement card with your correct name.

Married Names and Name Changes

Legally changing your name (such as when you get married or divorced) may cause your cardholder name to be different from your new legal name. While it is common for people to contact their financial institution to update the name on their account (and debit or credit card), it may not be required.

It can be a smart idea to have your cardholder name updated to match your new legal name at your earliest convenience. To update the name on your account as well as your cardholder name, contact your bank or credit union (or your credit card issuer). They can usually change the name on your account as well as ship you a new card with your updated name.

Recommended: Savings Account Interest Calculator

Cardholder Name vs. Authorized User

Many credit card and other financial accounts allow the primary account holder to add authorized users to their account. A fact about debit cards and credit cards is that an authorized user is someone who can use the card to make purchases but ultimately is not responsible for the account or the debt.

Here are some points to know about this arrangement:

•   Generally, each authorized user who is added to an account will receive their own card with their own cardholder name.

•   In some cases, an authorized user’s card will have the same card number as the primary account holder, while other times each authorized user has a different credit or debit card number.

Regardless, when adding an authorized user to an account, be sure you trust the person to use the card responsibly as it’s your personal finances on the line.

Protecting Your Identity: Best Practices

Identity theft is a real and growing concern, with the Federal Trade Commission (FTC) receiving more than one million reports of this problem via its website in 2023. It’s smart to take precautions to safeguard your personal details to avoid this scenario and related bank fraud.

One best practice for protecting your identity is to make sure to shield your credit or debit card from unauthorized use. Avoid giving out your debit card’s personal identification number, or PIN, and don’t lend your cards to people.

If you’re a frequent online shopper or place orders by phone, you might look into using what are known as virtual card numbers to further protect your account. Many credit cards offer the ability to generate these virtual card numbers which are good for a one-time use. They are typically created via a browser extension or an app.

Recommended: How to Write a Check

The Takeaway

Most credit and debit cards have the name of the account holder or authorized user embossed or printed on the card, as a way to ensure that only the correct person with privileges uses the card. While often the cardholder name is the full and legal name of the account holder, that is not always the case if, say, you have recently changed your name or you use a variation of your name. In these instances, you may want to update your card so it reflects your legal name.

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FAQ

Can my cardholder name be different from my legal name?

Yes, the name on your card may differ from your full and legal name and you may be able to still use your card to make purchases or withdraw money. However, it can be wise to have your card updated if, say, you changed your name when you got married or if your name was accidentally misspelled. Your bank or card issuer can revise your account information and send you a new card with an updated cardholder name.

What should I do if my cardholder name is incorrect?

While you may be able to make purchases with the card and be legally liable for any purchases made to your account, even if the name is not your full and legal name, it’s wise to update it. You can contact your bank, credit union, or other financial institution. They will be able to send you an updated card, usually at no cost to you.

How does my cardholder name affect online purchases?

When using a debit card or a credit card online, you will usually be asked to enter your cardholder name during checkout. You may also need to enter your name to register as a customer. While in most cases your legal name and your cardholder name match, if not, you’ll want to make sure to type in the name that is actually printed on your credit or debit card when you are entering your payment information. If the name on your card differs from your legal name, you may want to have your cardholder name updated to align with it.

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SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2024 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

SoFi members with direct deposit activity can earn 4.00% 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 4.00% 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 4.00% 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 12/3/24. There is no minimum balance requirement. Additional information can be found at https://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.

This content is provided for informational and educational purposes only and should not be construed as financial advice.

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Nov
08
2024

What Is a Crossed Check? Definition & Example

By | Financial Topics, Terminology | Comments Off on What Is a Crossed Check? Definition & Example

While not common in the United States, a crossed check has parallel lines running across it or across its top left corner, indicating that it is only able to be deposited, not cashed. This can provide an additional level of security and can help prevent fraud.

Learn more about crossed checks and how they impact financial processes.

Key Points

•  Crossed checks, marked with parallel lines, must be deposited, not cashed, enhancing security and preventing fraud.

•  These checks are uncommon in the U.S., but prevalent in parts of Europe and Asia, as well as Mexico and Australia.

•  Benefits include increased security, fraud prevention, and risk mitigation by requiring deposit into a bank account.

•  Drawbacks include restricted use in countries like the U.S. and potential delayed access to funds.

•  Crossed checks cannot be “uncrossed” by the payee, but possibly by the payor.

Definition of a Crossed Check

A crossed check is one that is marked, usually with two parallel lines horizontally across the entire front of the check or just across the top left corner. The words “& Co.”, “& Company”, “And Company” or “Not Negotiable” may also appear with the lines.

A crossed check may not be directly cashed — instead, the funds from a crossed check must be first deposited into an account such as a checking account. It can’t be signed over to anyone else, nor can the payee “uncross” it (though the payor might be able to).

Crossed checks originated with the British, codified with the Bills of Exchange Act of 1882 in the United Kingdom and the Negotiable Instruments Act of 1881 in India. Crossed checks (sometimes referred to as crossed cheques) are still common in certain areas of the world, including several European and Asian countries, Mexico, and Australia. However, they are virtually unused in the U.S. banking system.

If you are overseas and sending a crossed check to someone in the U.S., you should make sure that the recipient has an account that is able to accept it.

Recommended: APY Calculator

Benefits of a Crossed Check

Here are a few of the benefits of crossed checks:

Enhanced Security

Whether you’re using online or traditional banking, security can be paramount for many consumers. When you cross a check, you are ensuring that the check cannot be cashed and instead must be deposited into an account. This increases security and ensures that there is a trail of who deposited the check.

Fraud Prevention

Another benefit of crossing a check is helping to ward off fraud. While it is typical for banks to require identification when cashing a check, this process is not quite as secure as requiring a check to be deposited into a bank account, such as a high-yield checking account.

By requiring deposit, a crossed check can be fully verified and the transaction then processed. This can help reduce the risk of banking fraud.

Risk Mitigation

Businesses often engage in risk mitigation, trying to reduce the risk of certain types of transactions. Using crossed checks can help reduce the risk of something going wrong with a particular type of check. This is because a crossed check is required to be deposited into a bank account and cannot immediately be cashed. This can provide an additional level of security to these types of check payments, allowing time for verification and lowering the overall risk of the transaction.

Limitations and Drawbacks

While there are some benefits and reasons to use crossed checks, there are a few limitations and drawbacks that you’ll want to be aware of.

Restricted Use

One of the biggest drawbacks is that the recipient may not have a bank account that is able to accept crossed checks. This is especially true if the recipient lives in a county where crossed checks are not particularly common (such as the United States). If a U.S. bank does accept a crossed check, you will have to wait for it to clear vs. being able to cash it.

Delayed Access to Funds

Another drawback is that it may cause delays for the recipient to access their money. When you cash a check at a bank or other financial institution, you can generally receive the money right away. However, with a crossed check, the check must be deposited into an account with a financial institution. This may mean a delay of several days for the check recipient to access their money, depending on how long it takes for the check to clear.

Example of a Crossed Check

You are unlikely to see an example of a crossed check in the U.S. However, if you are in another country, you might see one. It would likely have these elements:

•  It would have two crossed parallel lines that were added when the payor was writing the check. These might go horizontally across the entire front of the check. Or they might cross the top left-hand corner on a diagonal.

•  Sometimes, the words “& Co.” or “not negotiable” (or similar phrases) may also be added.

Typically, it’s not possible for a recipient to uncross a check once these marks have been made.

Recommended: 39 Passive Income Ideas to Help You Make Money

The Takeaway

A crossed check (sometimes referred to as a crossed cheque due to its British origins) is marked by two parallel lines across the front of the check. A crossed check cannot be cashed directly — instead, it must be deposited into an account at a bank, credit union, or other financial institution. This can help to mitigate risk, prevent fraud, and enhance the overall security of the process. While crossed checks are not generally used in the United States, they are still quite common in several other countries around the world.

If you are based in the U.S. and looking for a bank account that can make money management easier, see what SoFi offers.

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 4.00% APY on SoFi Checking and Savings.

FAQ

Are crossed checks still widely used?

Crossed checks are still widely used in the banking industry, but only in certain countries. Crossed checks are not very common in the United States, which may explain why many Americans have not heard of them or are not familiar with them. Rather, they are usually part of personal banking in some European and Asian countries, as well as Mexico and Australia.

Can a crossed check be uncrossed?

Generally a crossed check can not be uncrossed by the payee. The whole purpose of crossing a check is to make sure that it must be deposited into a bank account. This lets the signer of the check be able to track where the funds have gone, in case there are any issues. However, in some cases the payor (the person making out the check) could write “crossing canceled” across the face of the check to undo the crossing.

Are crossed checks common in the United States?

Crossed checks are not common in the United States, though they are still widely used in other parts of the world. In fact, because crossed checks are so uncommon in the United States, you may have trouble depositing a crossed check in the U.S.

Photo credit: iStock/AndreyPopov

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2024 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

SoFi members with direct deposit activity can earn 4.00% 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 4.00% 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 4.00% 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 12/3/24. There is no minimum balance requirement. Additional information can be found at https://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.

SOBNK-Q324-115

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Nov
08
2024

What Is a Microdeposit?

By | Family Finances, money, Terminology | Comments Off on What Is a Microdeposit?

Microdeposits are small amounts of money, usually less than $1, temporarily added to your account. They are generally used to confirm that a bank account is valid and able to accept funds. Another reason a microdeposit might be used is as a security feature when you are linking your bank account to another bank account or to a third-party service, such as a budgeting app.

You are typically asked to verify the amount of a microdeposit to ensure that you are the account holder. This can help reduce the risk of fraudulent activity on a bank account. Learn more about microdeposits and how they can impact your banking activity.

Key Points

•   Microdeposits are small, temporary deposits, usually under $1, that are used to verify bank account ownership.

•   Microdeposits can help verify someone is the legal owner of a bank account they’re trying to link to or otherwise access.

•   To verify ownership of an account, users must report the exact amounts of (typically) two small deposits received during account linking.

•   Verifying accounts through microdeposits can help reduce the risk of someone trying to fraudulently access account funds. Unexpected microdeposits can, however, indicate a scam.

•   Microdeposits deposits are usually temporary and withdrawn by the issuing bank within a few days.

Defining a Microdeposit

Microdeposits are a type of deposit, or funds added to your bank account, but in this case in very small amounts. Here are more details about how they work.

Small Temporary Deposits

The term microdeposit describes one or more small transfers of funds, each typically less than $1. They are usually sent by one bank to another bank when an account holder tries to link two bank accounts, such as for transferring money between them or perhaps for overdraft protection. They may also be sent when you are validating that you want your bank account linked to a particular service.

These deposits are usually temporary; you aren’t actually being paid for anything. After the microdeposits are sent, the account holder typically verifies their amounts. The funds are usually withdrawn by the issuing bank within a few days.

Purpose and Use Cases

One of the biggest reasons banks use microdeposits is to verify that a particular person is the owner of a specific bank account. Microdeposit verification is often used when someone tries to link a bank account to a type of account at a different bank. Using microdeposits allows the bank to authenticate that the person requesting the linkage actually is the owner of the account. This helps to reduce fraud and ensure the safety and security of accounts.

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How Microdeposits Work

The way microdeposits work is typically straightforward. If you enter your bank’s routing and account number to link your account to another bank or third-party service, you may receive microdeposits. Generally two microdeposits are sent, each for an amount under $1.

Once you receive the microdeposits in the bank account that you are trying to link, you will go back to the other site and verify the microdeposits by typing in their amount. Shortly after the microdeposits are sent (generally within a couple of days), the bank will then withdraw the money that was deposited. This ensures that there is no net change in your account’s value after the microdeposit process is complete.

Why Microdeposits Are Used

One of the primary reasons that banks use microdeposits is to prevent bank account fraud. These deposits help to verify that you are the legal owner of a bank account you are trying to link to or otherwise use. Without this step, it might be possible for an unauthorized person to link your account to another account and then possibly withdraw money from your account or commit other fraudulent activity.

Identifying and Confirming Microdeposits

A crucial step to the microdeposit process is identifying and confirming the microdeposits. It usually takes a few days for the microdeposits to show up in your account. Once you see them, you can return to the app or bank account where you initiated the linking process. By entering the amount of the microdeposits, you usually complete the microdeposit confirmation process.

One thing to watch out for is if you receive microdeposits you are not expecting. If you see microdeposits in your account when you have not tried to link it to another account, contact your bank’s customer service or fraud department. You may be targeted by a fraud or phishing attack, meaning that someone may be attempting unauthorized access to your account.

Recommended: How to Transfer Money From One Bank to Another

Potential Drawbacks and Limitations

While they are quite common, there are a few potential drawbacks and limitations of the microdeposit process:

Delayed Transactions and Clearance Times

The microdeposit process typically takes a couple of days for the deposits to arrive and be verified. This means that linking your bank account to another account or service is unlikely to happen instantaneously or even in a single day.

Account Restrictions and Holds

If you see microdeposits hit your account and you haven’t tried to link your account to any other bank or third-party app, you’ll want to contact your bank’s fraud or customer service department right away. This is because it may mean that someone else has tried to link your bank account to another account or service. This is one of the common bank scams, and your account may need to have some restrictions put in place.

Confusion and Misunderstandings

Seeing microdeposits in your checking account may cause confusion, even if they are part of a process you initiated. You might well see one of these little deposits and spend time asking yourself who would be sending you 17 cents or whatever the amount may be. Understanding what microdeposits are and perhaps noting in your calendar when they are likely to hit can help clear up any confusion or misunderstandings.

Recommended: 10 Personal Finance Basics

Scams Using Microdeposits

If you see microdeposits in your account when you have not tried to link your account, you may be the victim of a mobile deposit scam or other type of fraud. Here’s how these typically work:

•   Scammers may try to link your account to another account, generating microdeposits in your account.

•   They then try to get you to authenticate the deposits via a verification message.

•   If you do confirm the amounts (thinking the request is legitimate), they may be able to link your account to one they control, with the goal of withdrawing money from your account.

If you ever see microdeposits in your account that you didn’t initiate, follow these steps:

•   Do not verify the microdeposit.

•   Do not click on any links or downloads connected with the microdeposit and verification request.

•   Contact your bank’s security or fraud department immediately.

•   You might also let the Federal Trade Commission at ftc.gov know of this scam so they can take appropriate steps.

Protecting yourself from this kind of scam is important as fraud rises, with 2.6 million Americans enduring some form of fraud in 2023, according to the FTC.

Recommended: How to Write a Check

The Takeaway

Microdeposits (sometimes referred to as micro deposits or micro-deposits) are small deposits to your account, generally used to verify that your account is valid and owned by you. Microdeposits are often two small, temporary deposits (usually under $1) that, when confirmed, allow two accounts or your account and a service to be linked. Though microdeposit verification is usually a security measure, unexpected microdeposits can be a signal of a scam in progress, so be wary.

If you’re looking for a banking partner that makes accessing and growing your money easy, see what SoFi offers.

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 4.00% APY on SoFi Checking and Savings.

FAQ

Are microdeposits refunded or removed from the account?

Yes, microdeposits are generally refunded from your account, usually a few days after they are deposited. One example might be if you receive two microdeposits, for $0.11 and $0.34. A few days after the deposits, the bank will generally withdraw the money, usually with one withdrawal transaction. In this case, it would be a withdrawal for $0.45. This means that the microdeposit process has no long-lasting effect on your overall balance.

Do microdeposits affect my available balance or account status?

Microdeposits don’t have a huge impact on your available balance, because of how small they are. You will see a very small increase in your available balance due to the microdeposits, but that will go away after a few days. That is because the bank that put the microdeposits into your account will also withdraw that money after a few days, leaving your account balance as if there had been no deposits.

What if I can’t locate or identify the microdeposit amounts?

If you can’t locate or identify the microdeposit amounts, it may mean that there was a problem with the linking process. It’s possible that you had a typo or other error when inputting your routing and account numbers. Keep in mind also that it can take a couple days for these microdeposits to show up in your account. If it’s been a few days, you might try to restart the linking process or contact your bank’s or the third-party service’s customer service department.

Photo credit: iStock/SrdjanPav

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2024 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

SoFi members with direct deposit activity can earn 4.00% 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 4.00% 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 4.00% 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 12/3/24. There is no minimum balance requirement. Additional information can be found at https://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.

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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Nov
07
2024

What Credit Score Do You Need to Buy a House

By | Credit, Family Finances, Home Ownership, mortgage, personal_loan | No Comments

What’s your number? That’s not a pickup line; it’s the digits a mortgage lender will want to know. Credit scores range from 300 to 850, and for most types of mortgage loans, it takes a score of at least 620 to open the door to homeownership. The lowest interest rates usually go to borrowers with scores of 740 and above whose finances are in good order, while a score as low as 500 may qualify some buyers for a home loan, but this is less common.

Key Points

•   A credit score of at least 620 is generally needed to buy a house, but FHA loans may accept scores as low as 500 with a higher down payment.

•   Paying attention to credit scores before applying for a mortgage can lead to lower monthly payments.

•   A higher credit score can save borrowers money by securing lower interest rates over the loan’s term.

•   When two buyers are purchasing a home together, lenders look at both buyers’ credits scores.

•   Credit scores are not the only factor; lenders also evaluate employment, income, and bank accounts.

Why Does a Credit Score Matter?

Just as you need a résumé listing your work history to interview for a job, lenders want to see your borrowing history, through credit reports, and a snapshot of it, expressed as a score on the credit rating scale, to help predict your ability to repay a debt.

A great credit score vs. a bad credit score can translate to money in your pocket: Even a small reduction in interest rate can save a borrower thousands of dollars over time.

Do I Have One Credit Score?

You have many different credit scores based on information collected by Experian, Transunion, and Equifax, the three main credit bureaus, and calculated using scoring models usually designed by FICO® or a competitor, VantageScore®.

To complicate things, there are often multiple versions of each scoring model available from its developer at any given time, but most credit scores fall within the 300 to 850 range.

Mortgage lenders predominantly consider FICO scores. Here are the categories:

•   Exceptional: 800-850

•   Very good: 740-799

•   Good: 670-739

•   Fair: 580-669

•   Poor: 300-579

Here’s how FICO weighs the information:

•   Payment history: 35%

•   Amounts owed: 30%

•   Length of credit history: 15%

•   New credit: 10%

•   Credit mix: 10%

Mortgage lenders will pull an applicant’s credit score from all three credit bureaus. If the scores differ, they will use the middle number when making a decision.

If you’re buying a home with a non-spouse or a marriage partner, each borrower’s credit scores will be pulled. The lender will home in on the middle score for both and use the lower of the final two scores (except for a Fannie Mae loan, when a lender will average the middle credit scores of the applicants).

Recommended: 8 Reasons Why Good Credit Is So Important

A Look at the Numbers

What credit score do you need to buy a house? If you are trying to acquire a conventional mortgage loan (a loan not insured by a government agency) you’ll likely need a credit score of at least 620.

With an FHA loan (backed by the Federal Housing Administration), 580 is the minimum credit score to qualify for the 3.5% down payment advantage. Applicants with a score as low as 500 will have to put down 10%.

Lenders like to see a minimum credit score of 620 for a VA loan.

A score of at least 640 is usually required for a USDA loan.

A first-time homebuyer with good credit will likely qualify for an FHA loan, but a conventional mortgage will probably save them money over time. One reason is that an FHA loan requires upfront and ongoing mortgage insurance that lasts for the life of the loan if the down payment is less than 10%.

Credit Scores Are Just Part of the Pie

Credit scores aren’t the only factor that lenders consider when reviewing a mortgage application. They will also require information on your employment, income, and bank accounts.

A lender facing someone with a lower credit score may increase expectations in other areas like down payment size or income requirements.

Other typical conventional loan requirements a lender will consider include:

Your down payment. Putting 20% down is desirable since it often means you can avoid paying PMI, private mortgage insurance that covers the lender in case of loan default.

Debt-to-income ratio. Your debt-to-income ratio is a percentage that compares your ongoing monthly debts to your monthly gross income.

Most lenders require a DTI of 43% or lower to qualify for a conforming loan. Jumbo Loans may have more strict requirements.

First-time homebuyers can
prequalify for a SoFi mortgage loan,
with as little as 3% down.

How to Care for Your Credit Scores Before Buying a House

Working to build credit over time before applying for a home loan could save a borrower a lot of money in interest. A lower rate will keep monthly payments lower or even provide the ability to pay back the loan faster.

Working on your credit scores may take weeks or longer, but it can be done. Here are some ideas to try:

1. Pay all of your bills on time. If you haven’t been doing so, it could take up to six months of on-time payments to see a significant change.

2. Check your credit reports. Be sure that your credit history doesn’t show a missed payment in error or include a debt that’s not yours. You can get free credit reports from the three main reporting agencies.

To dispute a credit report, start by contacting the credit bureau whose report shows the error. The bureau has 30 days to investigate and respond.

3. Pay down debt. Installment loans (student loans and auto loans, for instance) affect your DTI ratio, and revolving debt (think: credit cards and lines of credit) plays a starring role in your credit utilization ratio. Credit utilization falls under FICO’s heavily weighted “amounts owed” category. A general rule of thumb is to keep your credit utilization below 30%.

4. Ask to increase the credit limit on one or all of your credit cards. This may improve your credit utilization ratio by showing that you have lots of available credit that you don’t use.

5. Don’t close credit cards once you’ve paid them off. You might want to keep them open by charging a few items to the cards every month (and paying the balance). If you have two credit cards, each has a credit limit of $5,000, and you have a $2,000 balance on each, you currently have a 40% credit utilization ratio. If you were to pay one of the two cards off and keep it open, your credit utilization would drop to 20%.

6. Add to your credit mix. An additional account may help your credit, especially if it is a kind of credit you don’t currently have. If you have only credit cards, you might consider applying for a personal loan.

Recommended: 31 Ways to Save for a House

The Takeaway

What credit score is needed to buy a house? The number depends on the lender and type of loan, but most homebuyers will want to aim for a score of 620 or better. An awesome credit score is not always necessary to buy a house, but it helps in securing a lower interest rate.

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.

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.

SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility-criteria 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.

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 .

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.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

¹FHA loans are subject to unique terms and conditions established by FHA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. FHA loans require an Upfront Mortgage Insurance Premium (UFMIP), which may be financed or paid at closing, in addition to monthly Mortgage Insurance Premiums (MIP). Maximum loan amounts vary by county. The minimum FHA mortgage down payment is 3.5% for those who qualify financially for a primary purchase. SoFi is not affiliated with any government agency.
†Veterans, Service members, and members of the National Guard or Reserve may be eligible for a loan guaranteed by the U.S. Department of Veterans Affairs. VA loans are subject to unique terms and conditions established by VA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. VA loans typically require a one-time funding fee except as may be exempted by VA guidelines. The fee may be financed or paid at closing. The amount of the fee depends on the type of loan, the total amount of the loan, and, depending on loan type, prior use of VA eligibility and down payment amount. The VA funding fee is typically non-refundable. SoFi is not affiliated with any government agency.

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Nov
07
2024

How to Buy a House Out of State

By | Home Ownership, mortgage | Comments Off on How to Buy a House Out of State

If you’re one of the more than 20 million Americans working remotely, you might be tempted to buy a house out of state. Or maybe you just need a change of scenery.

Buying a house long distance can be a challenge, but it’s doable with a plan in place.

Key Points

•   Millions of people are working remotely and may want to purchase a home out of state.

•   To begin, research potential new locations online and engage with local communities through social media platforms like Nextdoor to gain insights about the area.

•   Partner with a reliable real estate agent who knows the local market and can assist with navigating regulations and attending inspections.

•   Consider visiting the location in person if possible.

•   The closing process can now be easily handled online using remote notarization for efficiency.

Why Buy a House in Another State?

There are multiple reasons to consider a house in a different state. Here are some.

Affordability

People may be lured by the cost of living of a state and its quality of life, or trying to escape high costs in the state they are leaving.

More than 350,000 people left California (the country’s third-highest state in cost-of-living rankings) from April 2020 to January 2022 for Arizona, Texas, Florida, Washington, and other states. This trend slowed in 2023, but the state still lost more than 250,000 people.

Job Relocation

Some companies move personnel out of state, and some employees are good with that. A Graebel report exploring the Great Resignation found that 70% of knowledge workers who resigned in the past two years may have stayed if they’d been offered the same role in a different region of the country.

Family Reasons

Some folks choose to buy a house out of state to be closer to parents, children, or grandchildren. And people in their 40s,especially, may have aging parents and financial concerns on their minds.

Retirement

Americans entering retirement may want to buy a home in a state where the weather and lifestyle are more appealing. When it comes to a home, some may want to downsize.

How to Purchase a Home in Another State

Buying a house from out of state may be a challenge, but people do do it.

It can be tough to buy a house if you already have a house and a home mortgage loan. Homeowners have been known to use a home equity loan or bridge loan to fund the down payment on another house.

A personal loan can fund travel and moving costs.

If you’re ready to move on, it might be a good idea to sell and maybe ask for a leaseback. If you’re in a hurry, learn how to sell a house fast.

1. Virtually Explore

It’s easy to research cities, states, and communities online. There’s a listicle for almost everything.

For example, maybe you’re interested in the safest cities in the U.S.

Or the 50 most popular suburbs.

It can also be helpful to explore housing market trends by city.

Areavibes, BestPlaces, and HomeSnacks provide rankings or information. Coldwell Banker introduced Move Meter, to compare locations across the country. Or you could use Google Maps or Google Earth to study an out-of-state home’s proximity to schools, medical centers, law enforcement agencies, parks, and restaurants.

2. Link Up to Social Media

Social media platforms like Facebook Groups and Nextdoor can provide a personal sense of home buying and community. These groups are user-friendly to newcomers, and many group members are happy to answer questions about life in their city or town.

3. Ask Co-Workers, Friends, or Family

If you’re moving out of state for a job, check in with future co-workers for advice about the homes and neighborhoods. If you’re moving near friends or family members, pick their brains. Is this going to be a good spot for you?

Moving is stressful enough. If you’re one of the growing number of people interested in financially downsizing, you may want to just exhale and enjoy when you land.

4. Consider Talking to a Relocation Specialist

Yes, home relocation professionals exist. And they do everything from connecting clients with a real estate agent to finding a long-distance moving company, scouring school districts, securing a storage space, and supervising a contractor’s work if the client is buying or building a house.

Relocation companies can also suggest local service providers and transport pets and vehicles across state lines.
Relocation services are often free of charge because the specialists earn their money from third-party vendors like real estate firms and employers transferring employees.

If you’re not inclined to hire a relocation specialist, here’s some helpful reading before making a big move:

•   How to move across the country

•   How to move to another state

•   The ultimate moving checklist

You can look into the safety record of carriers on the U.S. Department of Transportation website.

5. Find a Reliable Real Estate Agent

A brave few who are interested in buying a house out of state opt to go without an agent.

It’s true that you can buy a house without a Realtor® — but even a local home sale may be challenging without a buyer’s agent in your corner.

Partnering with an experienced real estate agent who is based in the area where you hope to move could be highly beneficial.

Besides familiarity with neighborhoods, schools, and vibe, a buyer’s agent can walk a future homebuyer through local zoning regulations and the permit process.

6. Consider Visiting IRL

It’s not that rare to buy a house sight unseen. That can work out.

But someone looking to buy a house in a new state may want a real visit. You may receive short notice on a viewing date, so it could be helpful to budget for out-of-state travel as part of the buildup to buying a home in another state.

While a real estate agent can act as a proxy for homebuyers, there may be nothing like being onsite during the home inspection of a property you’ve made an offer on.

Then again, if you adore a property and must have it, you might waive some contingencies in the case of multiple offers.

7. Get Preapproved for a Mortgage

It can be easier to find a real estate agent or relocation specialist with a mortgage preapproval letter in hand.

When a lender preapproves a mortgage (a credit check and a review of financial assets is typical), it is tentatively greenlighting a specific home loan amount at a particular interest rate, which is not locked unless the lender offers a lock.

Obtaining preapproval tells home sellers that you’re qualified for a home loan up to a certain amount.

First-time homebuyers can
prequalify for a SoFi mortgage loan,
with as little as 3% down.

8. Handle the Closing Online

Get ready, because closing on a house may take only 20 or 30 days.

In some cases, everyone huddles to sign closing paperwork. Other times, buyers and sellers sign separately.

But most states have approved remote online notarization, when buyers join a video call, present their government-issued IDs to a title company rep and a notary, and sign all paperwork electronically.

The Takeaway

Buying a house out of state requires investigation and probably a good real estate agent. Getting preapproved for a mortgage can ease the path to a new address.

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.

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.

SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility-criteria 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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