Personal loans from online lenders like SoFi and Happy Money are becoming increasingly popular options for borrowers looking to consolidate debt or finance large expenses. But with different rates, terms, and features offered by each lender, how do you decide which is best for your needs?
This comprehensive guide examines the key pros and cons of SoFi and Happy Money to help you make an informed decision.
A Brief Comparison Table
| Feature | SoFi | Happy Money |
| Loan Amounts | $5,000 – $100,000 | Up to $40,000 |
| Rates | 5.99% – 18.85% APR | 5.99% – 25.65% APR |
| Terms | 2 – 7 years | 2 – 5 years |
| Minimum Credit Score | 680 | 580 |
| Minimum Income | $45,000 | $33,000 |
| Origination Fee | None | None |
| Prepayment Penalty | None | None |
| Time to Funding | 2-5 days | As fast as 1 day |
| Membership Perks | Yes | No |
| Frontloaded Pricing | No | Yes |
Overview Of SoFi And Happy Money
SoFi is an online lender that offers personal loans, student loan refinancing, mortgages, and more. SoFi personal loans range from $5,000 to $100,000 with rates starting at 5.99% APR and terms from 2 to 7 years.
Happy Money focuses specifically on personal loans up to $40,000 with rates starting at 5.99% APR and terms from 2 to 5 years. They also offer a unique pricing model that frontloads interest charges to help borrowers pay off the loan faster.
Both lenders have no origination fees or prepayment penalties associated with their personal loans. Applications can be completed online in minutes with fast funding if approved.
SoFi And Happy Money: Key Factors To Compare
Here are some of the essential factors to weigh when deciding between SoFi and Happy Money for a personal loan:
- Loan Amounts
SoFi offers higher maximum loan amounts up to $100,000, making them a better choice for large debt consolidation or bigger purchases. Happy Money caps loans at $40,000.
- Loan Terms
SoFi offers more flexible repayment terms between 2 and 7 years. Happy Money has a narrower range of 2 to 5 years. The longer terms from SoFi mean lower monthly payments.
- Eligibility Requirements
SoFi has higher eligibility standards than Happy Money. SoFi requires a minimum credit score of 680 and annual income of at least $45,000. Happy Money only requires a 580 credit score and $33,000 annual income.
- Interest Rates
Interest rates are similar starting at 5.99% APR, but can vary based on your creditworthiness and other factors. SoFi and Happy Money both offer rate discounts for setting up autopay from a bank account.
- Membership Perks
SoFi members get access to career coaching, networking events, and more. Happy Money does not offer any membership benefits.
- Speed of Funding
Happy Money touts fast funding in as little as 1 business day once approved. SoFi also provides relatively quick funding but does not advertise a specific timeline.
Also Read: Comparison Between 21st Mortgage And Vanderbilt Mortgage
How Happy Money’s Pricing Model Works
One of the unique features of Happy Money is their proprietary pricing model. Here’s an overview of how it works:
- Interest charges are frontloaded and added to the loan balance at the beginning. This prepayment helps pay down principal faster.
- Your monthly principal and interest payments are then calculated based only on the original loan amount, excluding the preloaded interest charges.
- Each payment goes directly towards reducing principal first before interest owed. This helps you pay off the loan faster and save money on interest over time.
- Happy Money claims the model can help borrowers pay off loans up to 3 years faster compared to a standard amortization schedule.
The model appeals to borrowers looking to minimize interest costs over the long run. However, it also results in higher monthly payments than a comparable standard loan.
Which Loan Is Right For You?
Deciding between SoFi and Happy Money loans ultimately depends on your specific financial situation and needs. Consider the following:
- Loan Size Needed
If you need to borrow more than $40,000, then SoFi is likely your only option between the two. Their higher maximum loan amount makes them better for large consolidations.
- Your Credit Score and Income
Those with lower credit scores below 680 or income under $45,000 may have better luck getting approved with Happy Money’s lower eligibility bars. SoFi appeals more to borrowers with good credit and high incomes.
- Interest Rate Sensitivity
While both lenders offer competitive rates, even small differences can add up over the lifetime of your loan. Getting quotes from each and comparing rates for your situation is recommended.
- Desired Loan Term
If you prefer longer repayment terms, SoFi accommodates up to 7 years whereas Happy Money caps terms at 5 years. The longer timeframe comes with lower monthly payments.
- Value of Membership Perks
If you want to enjoy SoFi’s member benefits like career coaching and networking events, it would provide added value over the lending-only focus of Happy Money.
Also Read: Comparison Between Axos And SoFi Online Bank.
SoFi And Happy Money: Summary Of Pros And Cons
| SoFi | Happy Money |
| Higher loan amounts up to $100k | Lower eligibility requirements |
| Longer repayment terms up to 7 years | Faster funding as soon as 1 day |
| Variety of member perks | Unique frontloaded pricing model |
| Strict eligibility requirements | Maximum loan of $40k |
| Slightly slower funding timeline | Shorter repayment terms up to 5 years |
| No unique pricing model | No membership perks |
Also watch this video about Sofi Bnk!
Frequently Asked Questions (FAQ)
Yes, Happy Money is a legitimate lender. They are an established company founded in 2009 and based in Irvine, California. Happy Money currently services over 15,000 customers across all 50 states.
Like any lender, Happy Money will perform a hard credit check when you apply for a loan, which can temporarily lower your credit score. However, responsibly making on-time payments can actually improve your credit over time. Their loans also help consolidate debt which improves credit utilization.
Happy Money advertises that funding can be as fast as 1 business day after loan approval. However, it depends on when you complete the documentation process. The full timeline is usually 1-4 days after approval.
Yes, Happy Money has no early payoff penalties. Their loans can be paid off early in full or in part to minimize interest costs. Their frontloaded pricing model also incentives early payoff.
Also Read: Comparison Between Wells Fargo And Regions Bank.
The Bottom Line
While SoFi and Happy Money both provide competitive personal loans online, subtle differences make each lender better suited for particular borrowers’ needs. Be sure to compare interest rates and carefully weigh factors like loan amounts, credit requirements, terms, and features.
Many even get quotes from both lenders. This ensures you find the right loan and lender for your financial situation.