Earnest vs SoFi: Private student loans compared
When federal financial aid falls short of covering the total cost of college, the choice between Earnest and SoFi comes down to specific priorities: Earnest offers superior payment flexibility and budget-matched terms, while SoFi provides extensive member benefits and career support services. Both lenders are industry leaders with no origination fees and competitive rates, making them excellent options for bridging the funding gap.
For many families and students, navigating the private loan market can feel overwhelming. You might be wondering which lender offers the best interest rates, who has the most forgiving repayment options, or which company provides the best customer experience. Understanding the nuances between these two top-tier lenders is crucial for minimizing the long-term cost of borrowing and ensuring the monthly payments fit your post-graduation budget.
In this guide, you will learn:
- The specific interest rate ranges and fee structures for both lenders
- How eligibility requirements and cosigner rules differ
- Which unique benefits—like skipping a payment or unemployment protection—might save you money
- A clear decision framework to help you choose the right lender for your financial situation
By the end of this comparison, you will have the clarity needed to select the loan that best supports your educational goals and financial future.
What to know before comparing private student loan lenders
Before diving into the specific differences between Earnest and SoFi, it is important to understand the role private student loans play in your college financing strategy. Private loans are designed to fill the gap when savings, scholarships, grants, and federal student loans do not cover the full cost of attendance.
Unlike federal loans, which have standardized rates set by Congress, private lenders like Earnest and SoFi operate more like other financial institutions. They determine your interest rate and eligibility based on your creditworthiness (or that of a cosigner). This means that borrowers with strong credit profiles can often secure competitive rates, sometimes even lower than federal options for parents or graduate students.
According to Mark Kantrowitz, financial aid expert, “Private loans can be a good option when federal loans don’t cover the full cost of attendance.” This makes comparing lenders essential. When evaluating options, look beyond just the interest rate. Consider repayment flexibility, hardship protections, and the total cost over the life of the loan. Both Earnest and SoFi are reputable, established lenders that do not charge origination fees—a significant saving compared to some federal options like the Parent PLUS loan, which according to StudentAid.gov carries an origination fee of 4.228% for disbursements made between October 1, 2024 and September 30, 2025.
The “better” lender for you depends entirely on your specific needs: Do you need the lowest possible monthly payment right now? Are you worried about job security after graduation? Or is paying off debt as fast as possible your main goal? Keeping these priorities in mind will make the following comparison much more valuable.
Earnest vs SoFi: side-by-side comparison
To help you make a quick assessment, we have compiled the key features of both lenders. This side-by-side view highlights the similarities in their fee structures and the distinct differences in their repayment terms and flexibility.
| Feature | Earnest | SoFi |
|---|---|---|
| Fixed APR (Undergrad) | 4.29% – 15.90% | 4.49% – 14.83% |
| Variable APR (Undergrad) | 5.62% – 16.20% | 5.99% – 15.86% |
| Loan Amounts | $1,000 up to Cost of Attendance | $1,000 up to Cost of Attendance |
| Repayment Terms | 5, 7, 10, 12, 15 years (customizable) | 5, 7, 10, 15 years |
| Origination Fees | $0 | $0 |
| Late Fees | $0 | $0 |
| Prepayment Penalty | $0 | $0 |
| Autopay Discount | 0.25% | 0.25% |
| Cosigner Release | Available after requirements met | Available after 24 months of on-time payments |
| Grace Period | 9 months | 6 months |
| Minimum Credit Score | 650 | Does not disclose specific minimum |
Source: Earnest.com and SoFi.com; rates and terms current as of January 2025.
Both lenders are extremely competitive on the basics: neither charges origination fees, late fees, or prepayment penalties. This is a significant advantage over many other lenders in the market. The most notable difference in the raw data is the grace period—Earnest offers a generous 9-month grace period compared to the standard 6 months offered by SoFi and federal loans. Additionally, Earnest’s term options are more granular, allowing for a higher degree of customization.
Why these differences matter
It is easy to gloss over small percentage differences, but they compound over time. Here is why the details in the table above matter for your financial future:
- Interest rates: On a $30,000 loan with a 10-year term, a difference of just 0.50% in interest rate can save (or cost) you approximately $850 over the life of the loan.
- Grace periods: Earnest’s 9-month grace period gives recent graduates three extra months to find a job and get settled before bills start arriving. This can be a crucial safety net during a transition period.
- Origination fees: Because both lenders charge $0 in origination fees, you save money immediately compared to a federal Parent PLUS loan. According to StudentAid.gov, for a $20,000 loan, the 4.228% federal origination fee would instantly deduct over $845 from your disbursement. With Earnest or SoFi, every dollar you borrow goes to the school.
Interest rates and fees explained
Interest rates are often the deciding factor for families and students. Both Earnest and SoFi offer competitive fixed and variable rates, but how they determine those rates differs slightly. Understanding this process can help you gauge where you might find the better offer.
Earnest is known for its “merit-based” underwriting model. While they look at credit scores, they also take a holistic view of your financial health. They may consider factors such as your savings patterns, education history, and potential for future earnings. This approach can be particularly beneficial for students or cosigners who are financially responsible but may not have a long credit history. According to Earnest.com, as of January 2025, Earnest offers fixed rates of 2.99% - 12.78% (with autopay), making them highly competitive for borrowers with strong profiles.
SoFi uses a more traditional underwriting approach but also factors in professional history and cash flow. They place a strong emphasis on the borrower’s or cosigner’s ability to repay based on income and career trajectory. SoFi rewards strong credit histories with rates that rival the lowest in the industry. As reported by SoFi.com, their fixed rates are 4.49% - 13.98% as of January 2025.
Both lenders offer the choice between fixed and variable rates. A fixed rate stays the same for the life of the loan, providing predictability. A variable rate may start lower but can fluctuate with market conditions. According to Mark Kantrowitz, financial aid expert, “Private loans can offer variable interest rates, which may be lower than federal fixed rates initially.” However, in a volatile economic environment, a fixed rate is often the safer choice for long-term budgeting.
Both lenders offer a 0.25% interest rate reduction if you sign up for automatic payments. This is a simple way to lower the total cost of your loan. Crucially, neither lender charges “hidden” fees. There are no application fees, origination fees, or penalties for paying off your loan early. This fee-free structure ensures that 100% of your payment goes toward principal and interest.
Eligibility requirements and credit criteria
Qualifying for a private student loan typically requires a solid credit history or a creditworthy cosigner. Since many undergraduate students have thin credit files, applying with a cosigner—often a parent or guardian—is standard practice. This not only increases the likelihood of approval but often secures a lower interest rate.
To be eligible for an Earnest student loan, you must be a U.S. citizen or permanent resident (or have a cosigner who is). You must be enrolled at least half-time at a Title IV accredited school. According to Earnest.com, Earnest explicitly states a minimum credit score requirement of 650, which provides clarity for applicants before they apply. They also require that the borrower or cosigner has a minimum annual income of $35,000.
SoFi has similar baseline requirements regarding citizenship and enrollment. While they do not publicly disclose a hard minimum credit score, they generally look for “good to excellent” credit. SoFi requires that you have reached the age of majority in your state. Like Earnest, SoFi loans are available to undergraduate and graduate students, as well as parents.
For many parents, the goal is to help their child secure funding now but eventually transfer the debt responsibility to the student once they are working. This is where “cosigner release” comes in.
- SoFi: According to SoFi.com, SoFi allows you to apply for cosigner release after 24 months of consecutive, on-time principal and interest payments. The student must meet credit criteria on their own at that time.
- Earnest: Offers cosigner release, but the requirements are generally stricter. You must be a U.S. citizen or permanent resident and meet specific credit and income requirements. Always check the specific terms in your loan agreement, as these policies can vary by state.
If you are concerned about approval odds, read our guide on private student loans without a cosigner or learn more about how to find a cosigner.
Loan amounts, terms, and repayment options
Flexibility is one of the biggest differentiators between lenders. You want a loan that fits your budget, not one that forces you to change your life to make payments.
Both Earnest and SoFi allow you to borrow up to the full certified cost of attendance (tuition, fees, room, board, and supplies) minus any other aid received. The minimum loan amount is $1,000 for both, making them suitable for covering small gaps or large tuition bills.
SoFi offers standard repayment terms of 5, 7, 10, or 15 years. These are typical for the industry and allow you to choose between paying off debt quickly (5 years) or lowering monthly payments (15 years).
Earnest, however, stands out with a feature called “Precision Pricing.” Instead of forcing you into a 5 or 10-year bucket, Earnest allows you to choose your specific monthly payment amount, and they adjust the term to match. This means you could have a term of 6 years and 4 months if that fits your budget best. This level of customization is rare and highly valuable for borrowers with a strict monthly budget.
Both lenders offer four standard repayment choices while the student is in school:
- Deferred: Make no payments while in school (interest accrues and is added to the balance).
- Fixed: Pay a small fixed amount (e.g., $25) every month while in school.
- Interest-only: Pay the interest charges each month to prevent the balance from growing.
- Full principal & interest: Start making full payments immediately to save the most money.
Choosing an option that requires some payment during school is highly recommended to keep total costs down.
Borrower benefits and unique features
Beyond the numbers, the borrower experience and safety nets offered by each lender can swing the decision.
Earnest is built for borrowers who want control. According to Earnest.com, their standout feature is the Skip-a-payment benefit. Once every 12 months, borrowers in good standing can request to skip a payment without penalty. The missed payment is simply moved to the end of the loan term. This can be a lifesaver during unexpected emergencies like a car repair or medical bill. Additionally, Earnest offers a biweekly payment option, which can help borrowers pay off their loans faster by making one extra full payment per year effortlessly.
SoFi positions itself as a “member” organization, not just a lender. According to SoFi.com, their hallmark feature is Unemployment protection. If you lose your job through no fault of your own, you can apply to pause payments for 3-month increments (up to 12 months total). During this time, SoFi also provides career coaching to help you get back on your feet.
Other SoFi benefits include:
- Career services: Access to career coaches and networking events.
- Member discounts: Rate discounts on other SoFi products (like personal loans or mortgages).
- Financial planning: Complimentary access to financial planners.
If your priority is day-to-day budget management, Earnest’s skip-a-payment and precision pricing are superior. If you are worried about long-term career stability or want broader financial guidance, SoFi’s ecosystem offers more value.
Application process and funding timeline
Applying for private student loans is generally much faster than the federal financial aid process. Both Earnest and SoFi have streamlined, fully digital application experiences designed to reduce stress.
The Earnest application typically takes about 15 to 20 minutes to complete. You can check your eligibility and see your estimated rate with a “soft credit check,” which does not impact your credit score. Once you proceed with a full application, you will need to upload documents like proof of income (pay stubs or tax returns) and enrollment verification. Earnest is known for quick processing; once approved and the school certifies the loan, funds are typically disbursed within a few weeks, aligning with your school’s payment dates.
SoFi also offers a pre-qualification tool that allows you to view rates without a hard credit inquiry. Their mobile-friendly application is intuitive and quick. After you submit your documents and sign the loan agreement, SoFi works directly with your university’s financial aid office to certify the loan amount and disburse the funds. The entire timeline from application to certification usually takes 3 to 10 business days, though school certification speeds can vary.
For both lenders, the funds are sent directly to the school, not to your personal bank account. The school applies the money to your tuition and fees first. If there is any money left over (for living expenses), the school will refund that balance to the student.
Which lender is right for you?
Choosing between two excellent lenders is a good problem to have, but you still need to make a decision. Use this framework to decide which loan aligns best with your family’s needs.
- You need budget precision: You want to pick your exact monthly payment amount rather than being forced into a standard 10-year term.
- You value a safety net for cash flow: The option to skip a payment once a year offers peace of mind for unexpected expenses.
- You want a longer grace period: The 9-month grace period gives you more breathing room after graduation than the standard 6 months.
- You have a “thin” but responsible credit file: Their holistic underwriting might view your financial habits more favorably than traditional models.
- You want career insurance: The unemployment protection feature is a robust safety net if you work in a volatile industry.
- You value networking and coaching: You plan to utilize the free career coaching and financial planning services.
- You are already a SoFi member: Existing members may qualify for rate discounts or easier management across accounts.
- You want a clear path to cosigner release: Their 24-month release policy is transparent and shorter than Earnest’s timeline.
Since both lenders allow you to check your rates without affecting your credit score, the smartest move is often to apply to both. You may find that one offers a significantly lower interest rate based on your specific credit profile, which should be the primary deciding factor.
Check your personalized rates with Earnest and SoFi in minutes without affecting your credit score
Frequently asked questions
Yes, both lenders are major players in the student loan refinancing space. If you graduate, secure a good job, and improve your credit score, you can apply to refinance your loans (both private and federal) with either lender to potentially lower your interest rate. Check out our Student Loan Refinancing Guide for more details.
Yes. Earnest offers a specific Parent Loan product for parents who want to borrow on behalf of their child. SoFi also allows parents to borrow for their children, or parents can serve as cosigners on an undergraduate loan. Both are strong alternatives to the federal Parent PLUS loan, often offering lower rates for parents with good credit.
Both companies consistently receive high ratings for customer satisfaction. Earnest is often praised for its “Client Happiness” team and personalized support, while SoFi is recognized for its comprehensive member resources and community-focused approach. You are unlikely to have a poor service experience with either.
Absolutely. In fact, it is highly recommended. Both lenders use a soft credit inquiry to provide you with estimated rates. This means you can see exactly what interest rate you would pay at each lender without hurting your credit score. A hard inquiry only happens when you officially accept the loan offer.
If you face financial hardship, communication is key. Earnest offers the “Skip-a-payment” feature for short-term cash flow issues. SoFi offers unemployment protection which can pause payments if you lose your job. Both lenders also offer forbearance options for other types of financial hardship, though interest typically continues to accrue.
Conclusion
When comparing Earnest vs SoFi, there is no single “winner”—only the lender that best fits your specific financial life. Both companies have modernized the student loan experience by eliminating predatory fees and offering digital-first convenience. They are both safe, legitimate, and highly rated options for funding your education.
To recap, here are the key takeaways:
- Check your rates with both: Since there is no impact to your credit score, getting quotes from both lenders ensures you aren’t leaving money on the table.
- Prioritize flexibility with Earnest: If you want to customize your payment to the penny or have a longer grace period, Earnest is likely the better fit.
- Prioritize protection with SoFi: If career support and unemployment protection give you peace of mind, SoFi offers more value beyond the loan itself.
- Remember the hierarchy: Always maximize federal subsidized and unsubsidized loans before turning to private options, as federal loans offer unique protections like income-driven repayment.
Taking on student debt is a serious commitment, but choosing a lender that offers transparency and flexibility can make the repayment journey much smoother. Trust the numbers, consider the benefits, and make the choice that supports your long-term financial freedom.
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