Digital lender SoFi plans IPO


Digital lender SoFi is the last company to explore an independent public offering, according to a new report.

SoFi, headquartered in San Francisco, has held talks with a number of blank check companies to go public, according to CNBC.

The lender was the last valued at $ 4.8 billion after a roundtable last year. While best known for refinancing student loans, the startup also offers a variety of other financial products, including personal loans, small business loans, home equity loans, and mortgages.

SoFi has made a big effort in recent years to go beyond a specialization in student loan refinancing. In 2016, SoFi announced a partnership with Fannie Mae, which included a new loan option that allowed homeowners to refinance their mortgage at a lower rate and pay off an existing student loan balance.

On the mortgage front, SoFi is primarily targeting the jumbo market and will fund loans of up to $ 3 million. The lender requires a minimum of 10% down payment on all mortgages, but does not require PMI on the loans. While there is no setup fee, there is a one-time loan processing fee of $ 1,495. Borrowers with an existing SoFi product can get a reduction of $ 500 on the loan processing fee.

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SoFi is not the originator of government guaranteed loans, so it will not be the best option for FHA or VA borrowers. However, SoFi offers conforming conventional mortgages (10, 15, 20 and 30 year fixed mortgages).

According to Pitchbook data, SoFi has raised more than $ 3 billion in capital. Donors include the Qatar Sovereign Fund, a private equity firm Silver Lake and technology investor Peter Thiel. If it ends up going the PSPC route, it will follow two other mortgage lenders to choose the investment vehicle: United Wholesale Mortgages and black stone-possesses America’s Finance both should be made public in the coming months.

The company said it had recently received preliminary and conditional approval from the Office of the Comptroller of the Currency to establish a national banking charter. The company has also diversified into equity trading and cash management accounts.

In June 2019, three of SoFi’s senior executives left the company amid reported struggles with profitability.

According to data Recursion companies, SoFi securitized approximately $ 1.9 billion in mortgages in 2020, with a service portfolio valued at approximately $ 2.5 billion as of December 1.


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