SoFi vs. LendingClub Personal Loans: How They Compare

SoFi and LendingClub offer loans to borrowers with good to excellent credit. SoFi gets the edge with lower rates.
Steve NicastroJan 12, 2021

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SoFi and LendingClub are two options for low-cost personal loans. Both offer loans for debt consolidation, home improvements and other purposes.

For borrowers with excellent credit and strong income, we give SoFi the edge over LendingClub because it offers a lower range of rates plus no fees and more repayment flexibility.

Here’s a side-by-side comparison of SoFi and LendingClub. We always recommend borrowers compare loan terms, rates and features before applying.

SoFi vs. LendingClub at a glance

SoFi may be a better option if:

  • Your credit score and income are strong enough to get you the lowest rate

  • You want no origination or late fees

  • You want a large or variable-rate loan

Founded in 2011, SoFi is an online finance company that offers personal loans as well as student loan refinancing, mortgages and financial planning. It offers personal loans up to $100,000, an unusually large loan amount among online lenders.

How to qualify: SoFi requires a minimum credit score of 680; its borrowers generally have credit scores of 700 or higher. The company also considers income and free cash flow, or how much of your income is left after expenses.

You can apply with a co-applicant, which may help you qualify for a loan or get a lower rate. Co-applicants must live at the same address, according to SoFi, and both applicants are jointly responsible for repaying the loan.

Time to funding: SoFi’s loans are typically funded in seven days from the start of the application; co-applications may take a little longer.

Costs: SoFi offers both fixed- and variable-rate loans at annual percentage rates that range from about 6% to 20% with an autopay discount of one-quarter of a percentage point.

Rates on variable-rate loans can change based on market interest rates, but include caps. SoFi loans carry no origination fees, prepayment penalties, late fees or overdraft fees.

Repayment flexibility: SoFi allows borrowers with fixed-rate loans in good standing to change their payment due dates. The company also lets you apply for forbearance (temporary suspension of payments) for three months at a time if you lose your job at no fault of your own. Interest continues to accrue on suspended loans.

Good option for: SoFi loans work best for debt consolidation and funding large one-time expenses, such as home improvements. The lender offers high borrowing amounts, low rates and flexible repayment terms. You’ll need good credit and strong income to qualify.

LendingClub may be a better option if:

  • You want a smaller loan

  • You have an established credit history and good credit

  • You have a low debt-to-income ratio

LendingClub connects borrowers with investors through its online marketplace. Its loans range from $1,000 to $40,000 and can be used for many purposes, including debt consolidation, home improvements, auto financing and medical expenses.

How to qualify: LendingClub accepts applicants with lower credit scores than SoFi; its minimum credit score is 600. Applicants must also have at least three years of credit history and a debt-to-income ratio of less than 40% for single applicants.

Like SoFi, LendingClub offers joint applications. The borrowers' combined DTI ratio must be under 35%.

Time to funding: The entire process, from application to loan approval and funding, can take between three and seven days.

Costs: LendingClub’s APR ranges from about 11% to 36%. This includes a one-time origination fee between 2% to 6%, which is deducted from the loan proceeds. LendingClub also charges a late fee if a payment is more than 15 days late.

Direct payment of creditors: For borrowers consolidating debt, LendingClub offers to pay off your creditors directly. You can use up to 80% of your loan amount for this purpose.

Good option for: LendingClub loans work best for debt consolidation, borrowers with good credit and those who want to apply with a joint application. It requires a lower minimum credit score to qualify and looser income requirements than SoFi, but also carries a higher APR range.

Shop around for the best personal loan

If you have good credit, your best bet is to compare loans from SoFi and LendingClub against other lenders to ensure you receive the rate and terms that work best for you. Click the button below to pre-qualify on NerdWallet and receive a personalized rate from multiple lenders.

NerdWallet’s ratings for personal loans award points to lenders that offer consumer-friendly features, including: soft credit checks, no fees, transparency of loan rates and terms, flexible payment options, accessible customer service, reporting of payments to credit bureaus, and financial education. We also consider the number of complaints filed with agencies like the Consumer Financial Protection Bureau. This methodology applies only to lenders that cap interest rates at 36%, the maximum rate financial experts and consumer advocates agree is the acceptable limit for a loan to be affordable. NerdWallet does not receive compensation for our reviews. Read our editorial guidelines.

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