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The main differences between checking and savings accounts is that checking accounts are for spending and come with a debit card and checks, while savings accounts are a place to stash and grow your money via interest earned but your access may be more limited. These two kinds of financial products can form the foundation of how you manage your money day to day.

Read on to learn what the difference between a savings and checking account is, how they are the same, and the role each plays in your financial life.

Quick Comparison of Checking vs Savings Accounts

To help you understand the difference between checking and savings accounts, here is a chart summarizing some key points.

	Checking Account	Saving Account
Fees	Varies	Varies
Interest earnings	Minimal (if at all)	Yes
Debit card access	Yes	No
Check writing capabilities	Yes	No
Withdrawal limits	None	May be capped at 6 per month
Maintenance fees	Varies	Varies
Minimum opening balance	Varies	Varies
Best used for	Spending	Saving

There are similarities when you compare checking vs. savings accounts, such as varied minimum opening deposits, maintenance fees, and other monthly fees. Also, both kinds of accounts are typically insured by the FDIC (Federal Deposit Insurance Corporation) or NCUA (National Credit Union Administration), which can give you peace of mind.

That said, there are also three major points of difference between checking and savings accounts: how account holders access their money, withdrawal limits, and interest earnings.

Three Major Differences to Know

Consider these three important ways that checking vs. savings accounts can differ.

1. Interest Earnings

When it comes to earning a bit of a return on an online bank account, savings accounts typically offer a higher interest rate than checking accounts. In many cases, checking accounts aren’t interest-bearing, meaning no interest is earned at all. Interest rates for savings accounts vary. The current average is 0.46% APY (compared to a current average of 0.07% APY for checking accounts), according to the Federal Deposit Insurance Corporation, or FDIC. That said, you probably will find higher rates at online banks instead of bricks-and-mortar ones, with rates ranging from 4.35% to 5.15%. By not having physical locations, online banks save money and can pass savings onto their customers.

2. Liquidity

Here’s a key difference between a savings and checking account: Checking accounts are usually used by account holders to access their cash frequently, whether paying monthly bills or buying a latte. Checking accounts generally include a debit card, which can be used for purchases or ATM withdrawals. Checks, while not as popular as they once were, are also typically provided.

Savings accounts, on the other hand, don’t usually come with debit cards. Some financial institutions offer an ATM card for deposits and withdrawals to a savings account. Similarly, they lack checks. This reinforces the idea that these accounts are not for spending.

3. Withdrawal Limits

Checking accounts allow unlimited withdrawals, whereas savings accounts may only allow up to six per month. After that point, the transaction could be denied or the account holder charged a penalty. The bank might even convert the savings account into a checking account.

However, in April 2020, the Federal Reserve lifted this limitation of six transactions imposed through Regulation D. Financial institutions are no longer required to limit savings account withdrawals or transfers to six per month, but some may continue to do so. Check with your financial institution to learn the full story.

What Is a Savings Account?

A savings account is an account held at a financial institution such as a bank or credit union, and its primary purpose is to store your funds safely. Most savings accounts allow the account holder to earn interest on the account balance.

A few points to note:

•   Savings account rates are generally higher than those offered with checking accounts (if those pay any interest at all). For this reason, they can be a good option as a savings vehicle for money that the account holder doesn’t need to access frequently.

•   Common uses for savings accounts are emergency funds, short-term savings goals, and funds for occasional expenses. The cash can accumulate in the savings account and have an opportunity to earn interest.

•   As mentioned above, banks can still impose a per-month transaction limit on savings accounts — they’re just not required to by the Fed anymore. There could be fees imposed on these excess transactions, which can add up.

•   Some financial institutions may automatically close an account holder’s savings account or convert the savings account to a checking account if too many withdrawals are made each month on a regular basis.

•   Other financial institutions don’t charge a maintenance fee or require account holders to maintain a minimum account balance, although they may require a minimum deposit to open an account. It’s wise to check with your financial institution to make sure you understand the ground rules.

Benefits of Savings Accounts

Here are some of the upsides of opening and maintaining a savings account:

•   Savings accounts are low-risk, which means you are unlikely to lose money. Rather, you are likely to make money, thanks to interest, especially when that interest compounds.

•   Interest is a plus. By shopping around for high-yield accounts, you may be able to grow your money without the volatility of investing in, say, stocks.

•   Savings accounts are usually insured by the FDIC for up to $250,000 per account holder, per account ownership category, per insured institution. In the highly unlikely event of your bank going out of business, you’d be covered. What’s more, some banks participate in programs that extend the FDIC insurance to cover millions¹.

•   Easy access is another plus. Unless term or time deposits, in which your money can be locked up for a specific period of time, savings accounts allow for easy withdrawal of your funds.

•   Peace of mind can come with savings. Having a savings account can help you feel more secure as you work toward your financial goals. For instance, you’ll know that you have funds available if an emergency cropped up.

Recommended: Guide to Using an ATM

What Is a Checking Account?

A checking account is also held at a financial institution, though its primary purpose is to be used for everyday spending. These accounts generally don’t have any withdrawal limits, so account holders can make as many transactions as their heart desires.

•   Debit cards typically come with checking accounts, and can be used for purchases at bricks-and-mortar and online retailers and to withdraw cash from an ATM.)

•   Checking account holders may also be able to use paper checks, either complimentary or purchased by the account holder, which can be used to pay bills and make purchases.

•   Account holders may also access their funds by P2P platforms (such as Venmo or PayPal) and other means.

Checking accounts may not earn as much interest compared to savings accounts, if they earn any interest at all.

Many financial institutions charge the same types of fees for checking accounts and savings accounts, such as monthly maintenance fees. Additional checking account fees may include overdraft or non-sufficient funds fees and out-of-network ATM fees.

Having enough money in the account and sticking with in-network ATMs are good ways to avoid charges like these, but banks are required to disclose certain fees it charges. Take a look at the fee schedule for any particular type of account you are thinking of opening and get acquainted with the details.

Benefits of Checking Accounts

There are many advantages to having a checking account, including:

•   You can pay bills and transfer funds online, in person, or by app; there’s no need to carry around cash for such transactions. Checking accounts can make money management very convenient.

•   Checking accounts are typically insured by the FDIC (or, if you bank with a credit union, NCUA), so your money is safe. Even if the financial institution were to go out of business, you wouldn’t lose your money up to $250,000 per account holder, per account ownership category, per insured institution.

•   Checking accounts can be an affordable way to conduct financial transactions. For instance, your account is likely to come with checks, which can save you the effort and expense of using money orders or other types of payments in many situations.

•   Your checking account may offer rewards, such as cash back opportunities, or if you apply for a loan at the same institution, you may get a better rate.

Recommended: Ways to Avoid Overdraft Fees

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The Takeaway

Yes, there are significant differences between checking and savings accounts. They serve quite separate purposes (spending vs. saving) and can be useful in working toward varied financial goals. For many people, however, it’s not a question of which kind of account to open, but where’s the best place to open both.

When you’re looking for the best banks for checking and savings accounts, see what SoFi can offer.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible 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 3.30% APY on SoFi Checking and Savings with eligible direct deposit.

FAQ

Are interest rates variable on savings and checking accounts?

Savings and checking accounts virtually always have variable interest rates.

Are checking or savings accounts insured?

Yes, both checking and savings accounts are usually insured by the FDIC (or NCUA) for up to $250,000 per account holder, per account ownership category, per insured institution.

Is it better to have most of your money in a savings or checking account?

When comparing checking vs. savings accounts, know this: If you have a chunk of the money that will sit in the bank for a period of time, a savings account can be a wise choice since it will earn interest.

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Photo credit: iStock/AleksandarNakic

¹SoFi Bank is a member FDIC and does not provide more than $250,000 of FDIC insurance per depositor per legal category of account ownership, as described in the FDIC’s regulations. Any additional FDIC insurance is provided by the SoFi Insured Deposit Program. Deposits may be insured up to $3M through participation in the program. See full terms at SoFi.com/banking/fdic/sidpterms. See list of participating banks at SoFi.com/banking/fdic/participatingbanks.

SoFi Checking and Savings is offered through SoFi Bank, N.A. Member FDIC. 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.

Annual percentage yield (APY) is variable and subject to change at any time. Rates are current as of 12/23/25. There is no minimum balance requirement. Fees may reduce earnings. Additional rates and information can be found at https://www.sofi.com/legal/banking-rate-sheet

Eligible 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 (“Eligible Direct Deposit”) via the Automated Clearing House (“ACH”) Network every 31 calendar days.

Although we do our best to recognize all Eligible Direct Deposits, a small number of employers, payroll providers, benefits providers, or government agencies do not designate payments as direct deposit. To ensure you're earning the APY for account holders with Eligible Direct Deposit, we encourage you to check your APY Details page the day after your Eligible Direct Deposit posts to your SoFi account. If your APY is not showing as the APY for account holders with Eligible Direct Deposit, contact us at 855-456-7634 with the details of your Eligible Direct Deposit. As long as SoFi Bank can validate those details, you will start earning the APY for account holders with Eligible Direct Deposit from the date you contact SoFi for the next 31 calendar days. You will also be eligible for the APY for account holders with Eligible Direct Deposit on future Eligible Direct Deposits, as long as SoFi Bank can validate them.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, 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 Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

See additional details at https://www.sofi.com/legal/banking-rate-sheet.
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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Despite the increasing popularity of digital payments, you may still receive the occasional paper check. The good news: You’ve come into some money. The not-so-good news: It may take a day or two (possibly even longer) before you can actually access those funds.

The time it takes for a check to clear can vary depending on several factors, including the type of check, the amount, and the bank’s policies. Understanding the check-clearing process can help you better manage your finances and avoid overdrafting your account.

How Long Does It Take for a Check To Clear?

After you deposit a check into your checking account (or savings account), it typically takes one or two business days before the funds are fully available for you to use.

When you deposit a personal check, banks are generally required to make at least the first $225 available to you by the next business day. The remainder of the funds are usually available by the second business day to make sure the check doesn’t bounce. However, there are situations where the bank has the right to extend the hold. These include:

•   The bank has reason to suspect fraud.

•   You are re-depositing a check that has already been deposited.

•   You’ve deposited more than $5,525 by check in one day (the hold will only be for the amount that exceeds $5,525).

•   The receiving account is new (less than 30 days old) or has been repeatedly overdrawn.

•   The check is from a foreign bank.

Recommended: Check vs Direct Deposit

Can You Speed Up the Time It Takes for a Check To Clear?

While each bank has its own policies as to how long it takes a check to clear, there are some tactics you can try to help speed things up.

•   Deposit the check in person: If you deposit a check at a branch instead of using an ATM or your bank’s mobile deposit feature, you may be able to access your funds faster. Depositing a check at an ATM owned by another financial institution, on the other hand, could delay the process.

•   Time it right: If you deposit a check on a business day before the institution’s cut-off time, you won’t have to wait until the next business day for your bank to start processing the check. Cut-off times vary by institution but can’t be earlier than 2 p.m. for a branch deposit. Mobile deposit cut-off times are generally later — sometimes 8 p.m. or 9 p.m.

•   Sign up for direct deposit: If your employer offers direct deposit, enrolling in the program will typically allow you to access your paycheck sooner. Banks and credit unions are legally required to clear direct-deposited funds the next business day after they receive them. However, some institutions clear direct-deposit funds right away.

•   Choose a bank that offers quick check-clearing services: When searching for a new bank account, you may want to compare different banks’ policies regarding how quickly they clear checks. Some banks may advertise same-day availability of funds for deposits made in-branch, among other benefits.

What Affects the Speed at Which the Check Clears?

How long it takes for a check to clear depends on multiple factors. These include:

•   Your bank’s policy: Each bank and credit union has its own policies and procedures for clearing checks, which can vary.

•   When you deposit the check: In most cases, banks won’t process a check during weekends and holidays. If you deposit a check on a Saturday at an ATM or via mobile deposit, for example, the bank won’t begin processing the check until Monday or, if Monday is a holiday, on Tuesday.

•   The check’s amount: Larger checks may take longer to clear than smaller checks, as banks may place a hold on the funds to ensure they are legitimate.

•   Your account status: Banks may have longer holding times if your bank account is new, or you’ve overdrawn on it repeatedly.

•   Type of check: Personal checks typically take longer to clear than certified checks, cashier’s checks, and checks from government agencies. Checks from the same financial institution also tend to clear faster than checks from a different institution.

Recommended: What Would Happen if I Deposited $10,000 Into My Bank Account?

Can Banks Delay or Hold Your Check and Prevent It From Clearing?

Yes, banks have a right to hold your check or keep it from clearing if it suspects that the check is fraudulent or that the account holder is engaging in suspicious activity. They can also hold a check if the account from which the check was drawn does not have sufficient funds to cover the check amount.

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The Takeaway

Typically, a check should be processed and clear within one or two business days. However, certain factors — like depositing a check after a bank’s cut-off time, exceeding $5,525 in check deposits in one day, and depositing a check at an ATM not owned by your bank — can lead to a longer processing time.

It’s a good idea to become familiar with your bank’s policies regarding how long it takes for a check to become available for use. This will help you avoid overdrafting your account and getting hit with any unexpected fees.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible 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 3.30% APY on SoFi Checking and Savings with eligible direct deposit.

FAQ

How long does a check deposit take to show up?

The time it takes for a check deposit to show up in your account can vary depending on the bank’s policies and the type of check. In general, funds from a check deposit will be available the next business day, but some banks may hold the funds for a longer period, especially for large or out-of-state checks.

Do banks deposit checks instantly?

No, banks do not deposit checks instantly. When you deposit a check, the bank needs to verify the check’s authenticity and ensure that the payer has sufficient funds to cover the check amount. This process typically takes one or two business days, though it can sometimes take longer.

How long can a bank put a hold on a check?

According to rules set by the Federal Reserve, banks must make the first $225 of a check available the next business day. Amounts over $225 (up to $5,525) must be made available within two business days after the deposit. For check amounts of $5,525 or more, the bank generally should make the money accessible by the seventh business day after the deposit.

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About the author

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Photo credit: iStock/Jacob Wackerhausen

Annual percentage yield (APY) is variable and subject to change at any time. Rates are current as of 12/23/25. There is no minimum balance requirement. Fees may reduce earnings. Additional rates and information can be found at https://www.sofi.com/legal/banking-rate-sheet

Eligible 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 (“Eligible Direct Deposit”) via the Automated Clearing House (“ACH”) Network every 31 calendar days.

Although we do our best to recognize all Eligible Direct Deposits, a small number of employers, payroll providers, benefits providers, or government agencies do not designate payments as direct deposit. To ensure you're earning the APY for account holders with Eligible Direct Deposit, we encourage you to check your APY Details page the day after your Eligible Direct Deposit posts to your SoFi account. If your APY is not showing as the APY for account holders with Eligible Direct Deposit, contact us at 855-456-7634 with the details of your Eligible Direct Deposit. As long as SoFi Bank can validate those details, you will start earning the APY for account holders with Eligible Direct Deposit from the date you contact SoFi for the next 31 calendar days. You will also be eligible for the APY for account holders with Eligible Direct Deposit on future Eligible Direct Deposits, as long as SoFi Bank can validate them.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, 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 Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

See additional details at https://www.sofi.com/legal/banking-rate-sheet.
SoFi Checking and Savings is offered through SoFi Bank, N.A. Member FDIC. 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.

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.

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A money order is a valid form of payment, but the average American is likely to be more accustomed to receiving cash, a check, or a peer-to-peer payment through a popular third-party app.

You may wonder what to do if you receive a money order. You can cash it at various locations, such as your bank or a post office. Typically, you’ll need a valid ID to do so, and, depending on where you cash it, you may have to pay a fee. Learn more about the process here.

What Is a Money Order?

A money order is a secure way to pay another person or a business that offers a guarantee beyond what a paper check offers.

While paper checks can bounce if there’s not enough money in the check writer’s bank account, a money order has already been paid for. The funds exist in a secure account, and thus they cannot bounce when the recipient goes to cash the money order.

Advantages of Using Money Orders

Money orders offer several advantages for both the payer and the recipient:

•   No bank account needed: Those without bank accounts can’t send checks, and they may have difficulties using peer-to-peer payment apps, which typically require a checking account or debit card. This can make it challenging to send someone money without stuffing cash in an envelope, which is inherently risky.

An alternative? A money order. Because you can purchase and fund a money order with cash, you don’t need to open a checking account to complete the transaction.

•   No risk of bouncing: Because money orders are prepaid, you don’t have to worry about it bouncing. This makes it a safer way of accepting payment, particularly from a stranger.

•   No sensitive info: Checks contain personal information, including your name, address, phone number, and bank account and routing number. In the wrong hands, this can be risky and could leave you vulnerable to fraud. A money order shares much fewer details — typically, just the payer’s and recipient’s names.

Recommended: How to Transfer Money From One Bank to Another

Disadvantages of Using Money Orders

Money orders do have drawbacks to consider before purchasing:

•   Fees: The person purchasing the money order will need to pay a small fee (usually less than $5) to issue the money payment form. The recipient may need to pay a cashing fee as well, depending on where they go to cash the money order.

•   Limitations: Money orders are ideal for small transactions. Usually, they’re capped at $1,000. If you need to pay more, consider a cashier’s check.

•   Scam and loss risks: There are some risks involved with money orders. For instance, it’s difficult to cancel a money order; if the recipient has already cashed it, you’re out of luck. If not, you’ll likely have to pay a fee to have the money order canceled. Another major risk? Money orders are at the heart of many common bank scams.

Where to Purchase Money Orders

A huge benefit of money orders is how easily you can purchase them at common locations all around town. You can even purchase digital money orders without leaving the couch.

If you’re looking for a traditional paper money order, however, here are your main options:

Banks and Credit Unions

You can purchase a money order from most banks and credit unions. Often, you don’t even need to be a member of that financial institution, though you can inquire about discounts if purchasing from a bank or credit union where you’re already a customer.

Recommended: Can You Buy a Money Order With a Credit Card?

Post Office

The United States Postal Service (USPS) also sells both domestic and international money orders at many locations. You’ll want to visit its website to find a location near you that offers money orders; use the filter function to find offices that sell domestic and/or international money orders.

Grocery Stores and Retail Outlets

Many grocery stores, convenience stores, and other retail outlets (such as Walmart) also sell money orders, often through financial transfer services such as Western Union or MoneyGram. It’s a good idea to call a specific location in advance before driving there, just to be sure.

Step-by-Step Guide for Cashing a Money Order

Here’s how to cash a money order in four simple steps.

1. Verify the Money Order

Look over the money you received to ensure it appears valid. The USPS offers several tips to verify that your Postal Service money order isn’t a fake:

•   Check the limit: Domestic money orders are capped at $1,000. A money order for more than that might not be legitimate.

•   Look for security features: You should see a Benjamin Franklin watermark and a dark line (vertical) repeating USPS when holding the money order to the light.

•   Check the dollar amount for discoloration: If the money order looks odd, specifically where the dollar amount appears, it’s possible the payer changed the dollar amount after purchasing.

•   Make sure your name is correct: The name on the money order needs to match the name on your ID.

Other money order providers like banks and Western Union recommend such methods of verification as:

•   Double-check any watermarks that should be present for authenticity. Western Union and other providers may have watermarks or holograms to ensure their validity.

•   Verify the accuracy of the name and the dollar amount.

•   For Western Union money orders, you can phone For Western Union money orders, you can call 800-999-9660 to verify the funds.

•   For bank-issued money orders, you can visit a branch of the bank for authentication.

These steps can help ensure that your money order is legitimate and avoid issues down the line.

2. Endorse the Money Order

Assuming the money order is legitimate, take it to a bank or credit union, post office, qualifying retailer, or check-cashing location to cash it. You can cash it wherever it was issued (this should be evident on the money order), but you may be able to avoid fees by taking it to your own financial institution.

Once you’re there and at the counter, sign the money order to endorse it.

3. Present Valid Identification

Present your ID to the person behind the counter. They’ll compare your name to the name on the money order.

4. Pay Any Applicable Fees

Depending on where you are cashing the money order, you may have to pay a fee. Walmart, for instance, says it won’t charge more than $4 to cash a money order. However, fees can be particularly high at check-cashing services and retailers. To avoid these charges, you can take the money order to your own bank or credit union — or make sure the payer proactively sends extra funds with the money order to cover the cost of cashing it.

In addition to cashing a money order in this way, it’s worth noting that you can often cash a money by depositing it in an ATM. You can deposit an endorsed money order at an ATM at many bank once you’ve endorsed it, like a check.

Important Tips and Precautions

If you’ve received a money order, here are some tips to keep in mind:

Expiration Dates and Time Limits

While money orders don’t expire, it’s a good idea to cash or deposit yours as soon as possible. The longer you wait, the more you risk losing the money order or having it stolen. In addition, the value of the money order could decline due to fees being deducted if it sits for over one to three years.

Recommended: Tips for Tracking a Money Order

Fees and Charges

Where you choose to cash a money order can impact how much you pay in fees, if any. Your best bet for avoiding fees is taking it to your own bank or credit union. Go elsewhere, and the fees can cost a few dollars or more to cash a money order.

Handling Lost or Stolen Money Orders

If you’ve lost a money order you received or had it stolen, you’ll need to reach out to the money order’s issuer. That typically allows you to track the status of the money order or fill out a search request if the receipt is missing (which can involve a higher fee) if you don’t have the necessary details to quickly track it. Depending on what you learn, you might request a replacement and/or request a replacement if it’s been cashed fraudulently.

Avoiding Fraud and Scams

Fraudsters frequently use money orders to scam people out of money. If you’re selling goods online, don’t ship the items until you’ve received the money order and verified that it’s legitimate. Sometimes scammers will use the “overpayment” ruse in which they send you a money order for more than you were expecting and ask you to refund the difference. This should always be a red flag. The money order could prove to be fraudulent and, if you “paid back” the overpayment, you’ll be out some money.

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The Takeaway

Cashing a money order is fairly easy, involving just a few steps, including bringing it to a cashing location with valid ID. Always thoroughly review the money order to ensure it is legitimate before endorsing it and attempting to cash it. Also, to avoid potential fees, try cashing it at your own bank or credit union.

Speaking of banks, see what SoFi offers.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible 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 3.30% APY on SoFi Checking and Savings with eligible direct deposit.

FAQ

What is the difference between a money order and a cashier’s check?

While both a money order and a cashier’s check offer secure ways of sending money to another person, there are several key differences between the two. Cashier’s checks are available in larger sums than money orders, which are typically capped at $1,000 each. However, you can purchase money orders at more locations (making them accessible to those who are unbanked) — and usually at a lower fee.

How long is a money order valid for?

Money orders do not expire. The funds that are attached to the money order remain in an account until they are claimed by the recipient. However, if a money order stays uncashed for more than one or three years, a service fee could be assessed and could eat away at its face value.

Can I cash a money order at any bank or credit union?

You may be able to cash a money order at any bank or credit union, but you could also be charged a fee to do so. You can typically avoid this kind of fee by taking it to your own bank or credit union or the issuing institution.

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Photo credit: iStock/Sergey Dementyev

SoFi Checking and Savings is offered through SoFi Bank, N.A. Member FDIC. 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.

Annual percentage yield (APY) is variable and subject to change at any time. Rates are current as of 12/23/25. There is no minimum balance requirement. Fees may reduce earnings. Additional rates and information can be found at https://www.sofi.com/legal/banking-rate-sheet

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*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.

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Refinancing replaces your current mortgage with a new one. That’s something you might consider if you’d like to get a lower interest rate or different repayment terms. Having an open home equity line of credit (HELOC) can add a wrinkle to the refinancing process.

Here’s some comforting news for those who are wondering, If I refi my home, can I keep my HELOC? Yes, if your lender agrees to subordinate the line of credit. What, exactly, does that mean? Read on for what you need to know about refinancing with HELOC debt (or refinancing with an open line of credit).

Understanding Refinancing and HELOCs

Refinancing replaces your existing mortgage with a new home loan. You may refinance with your current lender or a different one. It’s a fairly straightforward process if you have just one mortgage to refinance. You compare mortgage rates from different lenders, go through the mortgage preapproval process, and apply for a loan. The lender appraises your home’s value and checks your credit to determine whether to approve you.

Do you have to pay off a HELOC if you refinance? Not necessarily. Whether you get to keep your HELOC after refinancing depends largely on the lender.

If you need an in-depth HELOC definition or want to better understand how this type of credit line works, read our detailed HELOC loan guide.

Impact of Refinancing on an Existing HELOC

Refinancing with HELOC debt opens up some different possibilities for how your line of credit is handled. It helps to understand what could happen before applying for a mortgage refinance loan.

Subordination of the HELOC

Subordination refers to the way debts are ranked in order of priority for payoff, from highest to lowest.1 When you get a loan to buy a home, the home secures the property. This creates a lien, which allows the lender to make a legal claim to the property if you don’t repay what you owe. This mortgage is a first or senior lien. A HELOC, on the other hand, is a secondary or junior lien.2,3

Here’s what that means in simple terms. If you refinance your home, your first mortgage takes precedence for payoff. Once that loan is paid off with the proceeds from the new loan, your HELOC moves into the first loan position.

If you were to sell the home or fall into foreclosure, the HELOC would take priority for repayment which poses a risk to the lender who provides your new mortgage. If there isn’t enough money from the sale or auction of the home to cover the refinanced mortgage debt, the lender could take a financial hit.

Paying Off the HELOC

You could pay off your HELOC in full prior to refinancing, either with cash on hand or money from the refinance loan. Once you pay your line of credit off, your lender may close the account. If you’d still like to have access to a credit line for emergencies or other purposes, you’d need to apply for a new HELOC.

Whether that makes sense can hinge on how much equity you have in the home and what you’ll pay for a new HELOC in interest and fees. If you’re refinancing your first mortgage because rates dropped, for instance, you may be able to qualify for a low rate on a new home equity line of credit.

Closing the HELOC

HELOC rules prevent lenders from closing your account as long as you continue making payments. So you wouldn’t be able to shut your line of credit down without paying the balance off first.4

If you’re refinancing your HELOC debt into the new mortgage (borrowing enough to cover what you owe on your home plus what you owe on your HELOC), the new loan would pay off the balance on your line of credit and close the account. Once your HELOC is closed you wouldn’t be able to make additional withdrawals from your credit line.

Recommended: How Much Does It Cost to Refinance a Mortgage?

Options to Retain Your HELOC During Refinancing

Keeping your HELOC when refinancing may take a little effort on your part. Here’s how to navigate this part of the refinance process.

Requesting Subordination from Your HELOC Lender

A subordination agreement is a legally binding agreement specifying that your HELOC will take a second lien position when you refinance. If you have a HELOC with one lender and plan to refinance with another, all the lenders involved in the transaction would need to agree to subordination.

You can reach out to your lender directly to ask if subordination is an option. If so, you’ll need to complete whatever paperwork the lenders require. A lender may have a standard subordination form you’ll need to fill out.5

Subordination allows you to keep your HELOC open after refinancing. You may, however, have to pay a fee to the lender to get them to agree to subordination of your line of credit.

Refinancing with the Same Lender

If you plan to refinance with the same lender that you have your HELOC with, it may be easier to have your subordination request granted. Keep in mind that:

•   New draws from your HELOC may be temporarily prohibited until refinancing is complete

•   Your new loan may come with a higher interest rate if the lender is concerned about your risk profile

•   A higher rate on your refinance loan could result in a higher monthly payment

If you’re considering this option, talk to your lender about how refinancing with a HELOC would work and the ways it might impact your new loan.

Refinancing Without Paying Off the HELOC

Subordination allows you to refinance your first mortgage without having to pay off your HELOC or close your HELOC account. The main consideration is whether you’ll be able to afford the monthly payments on your HELOC and your new mortgage payment.

Running the numbers is relatively easy if both your refinance loan and your HELOC have a fixed rate. It’s a little more challenging if you have a variable-rate HELOC.

With a variable-rate HELOC, your rate is tied to an index or benchmark rate, like the prime rate. If the benchmark rate goes up or down, your rate — and your payments — can move the same way.6

Pros and Cons of Keeping Your HELOC When Refinancing

Keeping your HELOC open when refinancing has pros and cons. Weighing both sides can help you decide if it’s right for you.

Advantages

Here are some of the benefits to keeping your line of credit open when you refinance.

•   HELOCs offer flexible access to credit when you need it, whether it’s for an emergency or a large purchase.

•   You pay interest only on the portion of the credit line you use, so you can control your costs to a degree.

•   Keeping your HELOC open means you don’t have to apply for a new one (and get another ding on your credit).

Disadvantages

When is keeping your HELOC open after a refi not the best move? Here are the downsides.

•   Subordinating your HELOC could mean paying a higher interest rate on your refinance loan, which can add to your cost of borrowing.

•   You risk losing the home if your refinance and HELOC payments become unaffordable.

•   An open HELOC could be a temptation to spend unnecessarily, leading to more debt and more interest that you’ll have to repay.

Recommended: How Often Can You Refinance Your Home?

Steps to Refinance Your Home While Retaining Your HELOC

Refinancing with a HELOC takes some planning and it helps to understand what you can expect. Here’s an overview of how refinancing with a HELOC typically works.

Assess Your Financial Situation

Your credit and finances carry weight in refinancing, as lenders want to see that you have a good credit history and reliable income. Before you start shopping for a lender, take time to:

•   Check your credit reports and scores

•   Review your monthly budget and income, including how much of your pay currently goes to debt repayment

•   Consider the long-term and how your income or expenses might change over time

•   Use a refinance calculator to estimate the monthly payments on a new loan

If you’re still in the draw period of your HELOC, you might be making minimum or interest-only payments. Once repayment begins, your principal plus interest payments could be much higher. Thinking ahead can increase the odds of being able to manage your HELOC and refinance loan payments.

Communicate with Both Lenders

Communication can make refinancing with a HELOC a much smoother process. If you plan to refinance with a lender that’s different from the one you have your HELOC with, you’ll need to talk to both of them about subordination.

This is an opportunity to explain why you want to keep your HELOC open and ask questions about the subordination process. Ultimately, it’s the HELOC lender that must agree to remain in the second lien position. Be prepared to explain the terms of the refinance loan to the HELOC lender and the HELOC terms to your refinance lender.

Understand Subordination Agreements

Subordination agreements may not be lengthy; they just need to include the key details of the transaction and the signatures of the parties involved. However, it’s still important to review the agreement carefully so you know what you’re agreeing to.

The agreement should include:

•   Names of the subordinating and refinance lenders

•   Your name

•   The date each mortgage was taken out

•   An acknowledgment by the HELOC lender that the HELOC will stay in the second lien position

If you’re having trouble decoding your subordination agreement, don’t hesitate to ask the lender to explain it in more detail.

Prepare Necessary Documentation

Your lender should handle preparation of the subordination agreement. You may need to provide the HELOC lender with documentation for the refinance loan, showing how much you plan to borrow.

For the refinance itself, your lender may ask for:

•   Recent pay stubs

•   Bank and/or investment account statements

•   Tax returns

•   A profit and loss statement if you’re self-employed

You’ll need to go through a hard credit check and get an appraisal of the home. The refinance lender may schedule an in-person, drive-by, or virtual appraisal. Once approved, you’ll just need to review and sign the closing paperwork and pay closing costs. Those are the basic steps for how to refinance a home loan, with or without a HELOC.

The Takeaway

Refinancing with a HELOC makes things a little more complicated, but it’s possible to keep your line of credit through a process called subordination. You’ll have to communicate both with your new mortgage company as well as with the lender who gave you the HELOC. Alternatively, it may be possible to pay off your HELOC with your new mortgage, or pay it off with funds from other sources before you undertake a refi.

SoFi now partners with Spring EQ to offer flexible HELOCs. Our HELOC options allow you to access up to 90% of your home’s value, or $500,000, at competitively lower rates. And the application process is quick and convenient.

Unlock your home’s value with a home equity line of credit from SoFi, brokered through Spring EQ.

FAQ

Is it possible to refinance both my primary mortgage and HELOC simultaneously?

It’s possible to refinance a primary mortgage and HELOC at the same time using a cash-out refinance. You’d get a new mortgage loan and pull your equity out in cash, then use that money to pay off the HELOC. You’d then have one mortgage payment to make going forward.

Will my HELOC lender agree to subordinate their lien during refinancing?

The answer to this question depends on the lender. Subordination moves the HELOC into a junior lien position, but that’s where HELOCs ordinarily go when you have a primary mortgage. Talking to your lender can give you an idea of whether subordination is something they’ll agree to.

How does the combined loan-to-value ratio impact refinancing with an existing HELOC?

Combined loan-to-value (CLTV) measures all of the outstanding mortgage debt you have against your home’s value. If your CLTV ratio is too high, that could affect your ability to qualify for a refinance loan. The lender may limit the amount you can borrow or deny you altogether.

Are there additional costs associated with subordinating a HELOC during refinancing?

Lenders may assess a fee to enter into a subordination agreement. The fee may be lower or higher, depending on the lender. Talking to your HELOC lender is the best way to find out whether subordination is allowed and if so, what fees you might pay.

Can I draw from my HELOC during the refinancing process?

Your lender may limit new draws while you’re in the middle of refinancing. Once the refinance is complete and the subordination agreement has been signed, you should be able to resume withdrawing from your credit line.

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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.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

^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.
^²SoFi Bank, N.A. NMLS #696891 (Member FDIC), offers loans directly or we may assist you in obtaining a loan from SpringEQ, a state licensed lender, NMLS #1464945.
All loan terms, fees, and rates may vary based upon your individual financial and personal circumstances and state.
You should consider and discuss with your loan officer whether a Cash Out Refinance, Home Equity Loan or a Home Equity Line of Credit is appropriate. Please note that the SoFi member discount does not apply to Home Equity Loans or Lines of Credit not originated by SoFi Bank. Terms and conditions will apply. Before you apply, please note that not all products are offered in all states, and all loans are subject to eligibility restrictions and limitations, including requirements related to loan applicant’s credit, income, property, and a minimum loan amount. Lowest rates are reserved for the most creditworthy borrowers. Products, rates, benefits, terms, and conditions are subject to change without notice. Learn more at SoFi.com/eligibility-criteria. Information current as of 06/27/24.
In the event SoFi serves as broker to Spring EQ for your loan, SoFi will be paid a fee.

Checking Your Rates: To check the rates and terms you may qualify for, SoFi conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.

SOHL-Q125-056

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A home equity line of credit or HELOC is a revolving credit line secured by your home. HELOCs have two phases: a draw period and a repayment period.

Your HELOC draw period is the window of time in which you can access your credit line before you must begin repaying what you have borrowed. A typical HELOC draw period is five years, though yours may be shorter or longer, depending on the terms of your borrowing agreement.

Here’s a closer look at how a home equity line of credit draw period works.

Understanding the Draw Period

What is a HELOC draw period? Simply put, it’s when you’re allowed to access your credit line. During the draw period, you can spend up to your credit limit and make payments to reduce the outstanding balance. That’s similar to how a credit card works.

Your choice of lender can influence how long your HELOC draw period lasts. Some lenders offer HELOCs with a five-year draw period; others extend it up to 10 years. Comparing HELOC options can help you decide which line of credit best suits your needs. Examine mortgage rates and consider getting preapproved for a HELOC to see what you might qualify for. Look for HELOC lenders that offer mortgage preapproval with no impact on your credit.

Recommended: HELOC Definition

How the Draw Period Works

The draw period on a home equity line gives you freedom and flexibility to spend, up to your credit limit. There are a few key details to know, however, about how a HELOC draw period works.

Accessing Funds

HELOC lenders can offer multiple ways to access funds during the draw period. Your options might include:

Paper checks

•   An ATM card or debit card

•   ACH transfers to a linked bank account

•   In-person cash withdrawals (if you opened your HELOC at a local bank)

Your HELOC lender should provide monthly statements showing your transaction activity, including how withdrawals were made, the amount, and the date. Keeping track of draws can help you calculate what your repayment installments may be later on.

Payment Structure

Your lender may require monthly payments during your HELOC draw period. The payment may be a set minimum dollar amount, or a payment equivalent to the interest only.

HELOCs typically accrue interest daily. Here’s how to find your daily interest accrual.

•   Divide your annual percentage rate (APR) by 365 (number of days in the year)

•   Multiply the result by your balance to find your daily interest accrual

For example, say you owe $50,000 to a HELOC at an annual APR of 5.00%. If you plug in the numbers, the math looks like this:

0.05/365 = 0.0001369863 x $50,000 = $6.85

Note that some lenders might use 360 instead of 365 to find your daily interest rate. That number assumes that every month has 30 days.

Your loan agreement should specify whether you’re required to make interest-only payments or a flat minimum payment. Keep in mind that if you can pay more than the minimum due, that’s usually a good idea. The bigger dent you can make in your balance during the draw period, the less you’ll have to repay later.

Have questions about home equity lines work in general? Explore our in-depth HELOC loan guide.

Interest Rates

HELOCs may have fixed or variable rates. A fixed interest rate stays the same for the life of the loan; variable rates, meanwhile, can increase or decrease over time based on changes to an underlying index or benchmark rate.

Variable-rate HELOCs can use the prime rate, LIBOR, or Treasury bill rate as their index rate. The prime rate is common, as it represents the rate at which banks lend to their most creditworthy customers. Lenders may charge a prime rate + a margin rate to set your HELOC rate.

Recommended: Understanding the Mortgage APR

Transitioning from Draw to Repayment Period

If you’re asking what is the draw period on a HELOC, it’s also important to ask what comes after. As you get closer to the end of your draw period, you’ll need to begin preparing for the repayment phase.

End of Draw Period

The end of your HELOC draw period is determined by the lender at the outset. Again, you may have five years, 10 years, or somewhere in between to spend with your credit line. Once the draw period ends, you can’t make any more withdrawals.

Your loan agreement should specify the end date of your draw period and when you’re expected to make your first regular monthly payment.

Can you extend a HELOC draw period? Maybe. Your lender might offer the option to renew your draw period so you have more time to access your credit line. You might pay a fee for the convenience.

The other option would be to refinance your HELOC into a new HELOC. That would give you a new draw period, followed by a new repayment term.

Repayment Terms

HELOC repayment may last anywhere from 10 to 30 years — it depends on the terms of your loan agreement. During the repayment period, you’ll make payments to the principal (meaning the amount you originally borrowed) and the interest.

HELOC repayment is amortized the same as other home loans, such as FHA loans or VA loans. Your lender should give you an amortization schedule showing how many payments you’ll make total and how much of each payment goes to principal vs. interest.

Can you pay off a HELOC during the draw period? Yes, if your lender allows you to do so. Be aware, however, that your lender might assess a prepayment penalty for an early HELOC payoff. Prepayment penalties allow lenders to recoup some of the interest they lose out on collecting when a borrower pays a loan off early.6

Impact on Monthly Payments

How much will you have to pay monthly to your home equity line of credit? It’s an important question to ask when planning your budget once the draw period ends.

Your HELOC payment amount is determined by:

•   Your principal balance

•   Interest rate and fees

•   Repayment term

If you have a fixed-rate HELOC, your monthly payments will be the same for the entirety of your repayment term. If you took out a variable-rate HELOC, your payments could change over time if your rate rises or falls.

Strategies During the Draw Period

Your HELOC draw period is for spending, but there are some things you can do to minimize what you’ll have to repay later. Here are a few tips for managing your home equity line of credit during the draw period and beyond.

Making Principal Payments

You may be obligated to make minimum or interest-only payments during the draw period, but consider whether you could make payments to the principal as well. For example, you might:

•   Apply your tax refund to the principal

•   Use a year-end bonus to wipe out some of the balance

•   Make biweekly payments or micropayments toward the principal

•   Double up on your regular monthly payments

Reducing your principal balance can shrink the amount of interest that accrues. And it can lower your monthly payments once you enter the repayment period.

Monitoring Interest Rates

If you have a variable-rate HELOC, it’s a good idea to keep an eye on interest rates. If you anticipate a rate hike sometime in the future, you may want to explore HELOC refinancing options.

Refinancing a variable-rate HELOC into a fixed-rate line of credit can offer some predictability with monthly payments. You don’t have to worry about your rate — and your payment — going up over time. You could also consider using a fixed-rate personal loan to pay off your HELOC debt. The advantage of this approach is that personal loans aren’t tied to your home. So if you lose your job or get sick and can’t work, you don’t have to worry about losing your home if you fall behind on the loan payments.

Monitoring Interest Rates

If you have a variable-rate HELOC, it’s a good idea to keep an eye on interest rates. If you anticipate a rate hike sometime in the future, you may want to explore HELOC refinancing options.

Refinancing a variable-rate HELOC into a fixed-rate line of credit can offer some predictability with monthly payments. You don’t have to worry about your rate — and your payment — going up over time. You could also consider using a fixed-rate personal loan to pay off your HELOC debt. The advantage of this approach is that personal loans aren’t tied to your home. So if you lose your job or get sick and can’t work, you don’t have to worry about losing your home if you fall behind on the loan payments.

Planning for Repayment

Your regular monthly HELOC payments may be significantly higher than your minimum or interest-only payments. So it makes sense to look at your budget to make sure you can afford what you’ll be expected to pay.

A HELOC repayment calculator is a helpful tool for estimating monthly payments and the total interest paid. You can just plug in your HELOC balance, rate, and repayment term to see how your payments might add up.

The Takeaway

What is a draw period on a HELOC? It’s your window to spend before repayment begins. The tips we’ve shared here can help you make the most of your draw period. If you’re still in the “shopping for a HELOC” phase, do your research: Look at different lenders’ interest rates, find out what is a HELOC draw period at various lenders, and inquire about prepayment policies and annual fees to find a lender whose offerings fit your needs.

SoFi now partners with Spring EQ to offer flexible HELOCs. Our HELOC options allow you to access up to 90% of your home’s value, or $500,000, at competitively lower rates. And the application process is quick and convenient.

Unlock your home’s value with a home equity line of credit from SoFi, brokered through Spring EQ.

FAQ

Can I make principal payments during the draw period?

Yes, you should be able to make principal payments during the draw period if your lender allows it. You can review your loan agreement or contact your lender to ask if principal payments are allowed and how to make them. Paying down the principal during the draw period can reduce what you have to repay later and potentially save you money on interest.

What happens if I don’t use my HELOC during the draw period?

One of the great things about a HELOC is that you only pay interest on the amount of your credit line you use. If you don’t use your HELOC during the draw period, there would be nothing to repay with interest later. You may still be responsible for paying annual maintenance fees or other fees associated with your line of credit.

Are there fees associated with the draw period of a HELOC?

HELOCs can come with a variety of fees, including annual or membership fees. If your lender charges an annual fee, you’ll pay it yearly during the draw period and the repayment period. The same goes for membership fees, which should all be explained in your loan agreement.7

How does the draw period affect my credit score?

HELOCs can affect your credit scores in the draw period in two key ways: payment history and credit utilization. Making the required monthly payments on time and keeping your HELOC balance low, relative to your overall credit limit, are the simplest ways to keep your credit score in good standing. Once you enter the repayment period, you’ll just want to continue making monthly payments on time.8

Can the draw period be extended?

Your HELOC lender may allow you to extend your draw period by renewing your line of credit. You may pay a fee to do so. If your lender doesn’t offer renewal, you might look into refinancing your line of credit into a new HELOC with a new draw period.

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Photo credit: iStock/milorad kravic

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.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

^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.
^²SoFi Bank, N.A. NMLS #696891 (Member FDIC), offers loans directly or we may assist you in obtaining a loan from SpringEQ, a state licensed lender, NMLS #1464945.
All loan terms, fees, and rates may vary based upon your individual financial and personal circumstances and state.
You should consider and discuss with your loan officer whether a Cash Out Refinance, Home Equity Loan or a Home Equity Line of Credit is appropriate. Please note that the SoFi member discount does not apply to Home Equity Loans or Lines of Credit not originated by SoFi Bank. Terms and conditions will apply. Before you apply, please note that not all products are offered in all states, and all loans are subject to eligibility restrictions and limitations, including requirements related to loan applicant’s credit, income, property, and a minimum loan amount. Lowest rates are reserved for the most creditworthy borrowers. Products, rates, benefits, terms, and conditions are subject to change without notice. Learn more at SoFi.com/eligibility-criteria. Information current as of 06/27/24.
In the event SoFi serves as broker to Spring EQ for your loan, SoFi will be paid a fee.

Checking Your Rates: To check the rates and terms you may qualify for, SoFi conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.

SOHL-Q125-055

Read more