Jan
23
2025

Can You Use Scholarship Money for Anything?

By | Going to College, student_loan | Comments Off on Can You Use Scholarship Money for Anything?

There are many different college costs to cover — tuition and fees, books and supplies, living expenses and transportation, to name just a few. If you received a scholarship to help pay for school, you might be wondering, can I use scholarship money for anything? In short, it depends on the scholarship terms.

If you were awarded a scholarship, congratulations! But before earmarking those funds for any specific purpose, it’s important to understand the way scholarships work and how to use scholarship money.

Key Points

•   Scholarship funds don’t need to be repaid, but they typically do come with spending restrictions.

•   Scholarships are primarily designated for tuition and fees and often also cover room and board.

•   Scholarship money may cover textbooks and other educational materials.

•   Noncompliance with scholarship spending terms can lead to having to repay the money and possibly owing taxes on it.

•   The organization that awarded the scholarship can offer guidance on spending restrictions and eligible expenses.

How Scholarships Work

Scholarships are a type of financial aid that students can use to pay for tuition and other school-related expenses. A key difference between scholarships vs. loans is that scholarships usually don’t need to be paid back, but student loans need to be repaid with interest.

Depending on the type of scholarship, these awards can be based on academics, financial need, participation in extracurricular activities, or a student’s chosen major, among other things.

There are different application requirements and selection criteria for each scholarship. But in general, students need to submit an essay, letters of recommendation, transcripts, and financial information to apply.

Scholarships often require students to complete the Free Application for Federal Student Aid (FAFSA). It’s a good idea to do that as soon as possible since scholarship deadlines vary.

Scholarships are available from a range of sources, including schools, nonprofit organizations, local government, and private companies. Using a
scholarship database can help narrow your search to find awards that align with your background, studies, and interests.

Recommended: Grants vs Scholarships

Does It Matter What Kind of Scholarship You Have?

The type of scholarship you have may be the key factor in how to use scholarship money.

Many scholarships stipulate the types of costs they cover. A scholarship may be limited to qualified education expenses, such as tuition, books, and supplies required for academic coursework, or it may extend to a broader set of education-related costs, including room and board and living expenses.

Typically, scholarships are paid directly to the school to ensure that financial aid goes toward a student’s education costs. Review a scholarship’s details to verify how the funds will be disbursed and any requirements on how it is spent.

What Can Scholarship Money Be Used For?

Can you use scholarship money for anything? Typically, scholarship money must be used for a student’s education and related expenses, but it depends on the specific scholarship requirements.

Here are some costs that could be covered by scholarship money.

Tuition and Fees

Scholarship funds are usually intended to be used to pay for tuition and fees at a college, graduate school, or trade school. Tuition is often the greatest expense when calculating the cost of attendance for college.

For the 2024-2025 academic year, the average sticker price for tuition and fees was $11,610 for students at public four-year institutions with in-state tuition, according to the College Board. For students at private nonprofit four-year colleges, the average tuition costs is $43,350.

If scholarships plus other federal financial aid you’ve been given don’t cover the total cost of your tuition and fees, private student loans could help cover the gap. These loans are offered by banks, credit unions, and online lenders.

How private student loans work is that their interest rate may be fixed or variable. The rate you get is based on your credit history and other financial factors. Interest on student loans accrues while you’re in school, and you may need to start repaying private loans while you’re in school or within a certain amount of time after graduation.

Keep in mind that it’s possible to refinance private student loans at a later date should you choose to. With student loan refinancing, you replace your current loans with a new loan, ideally one with a lower rate and more favorable terms, which could help lower student loan payments.

Education-Related Expenses

Along with tuition, students typically have to pay for other education-related expenses. Depending on your major and coursework, this could involve books, lab equipment, or other supplies required for classes.

Research

Students may be able to use scholarship money for research activities. For example, there are STEM scholarships specifically intended to help students advance their research in the fields of science, technology, engineering, and mathematics (STEM).

Supplies

Some of the supplies you need for school, such as a laptop, notebooks and pens, and even a backpack may be eligible expenses for scholarship funds.

Books

Books are another expense that could be covered by scholarship money. How much students need to spend on books and supplies varies by school, major, and from semester to semester. On average, students can expect to pay between $930 to $1,500 on books and supplies, according to the Education Data Initiative.

Living Expenses

Whether you live at home, on campus, or in an off-campus apartment, living expenses are another significant cost to plan for. What college students spend monthly on living expenses is around $2,932, according to the College Board.

Not all scholarships cover living expenses, but some of them do consider these expenses to be part of a college student’s cost of attendance.

Housing

You may wonder, can I use scholarship money for rent or student housing? Scholarship funds can often be used for room and board, but there may be limitations on the type of housing that’s covered.

In general, on-campus housing, which is a cost that is verified by schools, is more likely to be an eligible use of scholarship money than off-campus housing.

Bills

Students may have a number of bills to pay, including transportation costs.

Scholarships may help cover some transportation-related expenses, such as campus parking fees, but can you use scholarship money to buy a car — or pay for monthly car loan payments? It’s unlikely your scholarship funds can be used for car payments, unless the scholarship funds are completely unrestricted in their use.

Food

How much students spend on food depends on a number of factors, but the average monthly cost is $673 according to the Education Data Initiative.

Purchasing a school meal plan is a fixed cost that may be covered by scholarship funds. However, spending on groceries and dining at restaurants could be harder to justify as an eligible use of scholarship money.

Should You Save Scholarship Money for Certain Things?

Receiving a scholarship can change your expected family contribution on the FAFSA and impact what financial aid you qualify for. Additionally, students are typically limited to borrowing only up to the cost of attendance at their school if taking out student loans for undergrads. So if you don’t spend scholarship money wisely, you could come up short.

That’s why it’s wise to use a scholarship to cover education-related and eligible living expenses like tuition and fees, room and board, and supplies needed for classes.

Consequences of Misspent Scholarship Money

Using scholarship money inappropriately can have consequences. While scholarship funds aren’t meant to be repaid, it’s possible that an organization providing an award will have stipulations for how money is spent. This means that students could be on the hook for repaying a scholarship if it’s used for personal expenses instead of their education.

Additionally, scholarship money can be taxable if it’s used for living expenses not related to being enrolled in school.

If you have questions about whether an expense is eligible for scholarship money, check with your school’s financial aid office or the organization that issued the award.

The Takeaway

Scholarship funds are typically sent directly to a school to cover a student’s education costs, including tuition and fees, books and supplies, and room and board. Using scholarship money for personal expenses could mean having to pay taxes on the award or even repaying the funds if it violates the scholarship terms.

If, after applying for scholarships and grants and taking out federal loans, you still have a funding gap, you may want to consider private student loans. And remember, you can refinance student loans in the future for a lower interest rate and more favorable loan terms, if you qualify for them, which could help make your payments more manageable.

Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.

With SoFi, refinancing is fast, easy, and all online. We offer competitive fixed and variable rates.

FAQ

Can you cash scholarship money out?

Scholarship money is typically sent directly to your school. If there are leftover scholarship funds, your school might send the unused money to you as a refund check. This money would be subject to taxes, however, and its use may be restricted by the awarding organization.

Could you use scholarship money to buy a car

Buying a car is considered a personal expense, so it’s unlikely that a car purchase would be eligible for scholarship funds.

Are there any restrictions on what scholarship money can be spent on?

Many scholarships include restrictions on how the money can be spent. Some scholarships may limit funds to tuition and fees, while other awards might also cover education-related expenses and room and board. Check with the organization that awarded you a scholarship for specific funding restrictions.

Photo credit: iStock/ADragon

SoFi Student Loan Refinance
Terms and conditions apply. SoFi Refinance Student Loans are private loans. When you refinance federal loans with a SoFi loan, YOU FORFEIT YOUR ELIGIBILITY FOR ALL FEDERAL LOAN BENEFITS, including all flexible federal repayment and forgiveness options that are or may become available to federal student loan borrowers including, but not limited to: Public Service Loan Forgiveness (PSLF), Income-Based Repayment, Income-Contingent Repayment, extended repayment plans, PAYE or SAVE. Lowest rates reserved for the most creditworthy borrowers. Learn more at SoFi.com/eligibility. SoFi Refinance Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

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.


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.

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.

Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

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.

SOSLR-Q424-028

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Jan
23
2025

What Is Mortgage Foreclosure? Here’s What You Need to Know

By | Family Finances, Home Ownership, mortgage | Comments Off on What Is Mortgage Foreclosure? Here’s What You Need to Know

You may know someone who lost a home to foreclosure, but you might not know all the ins and outs of the process.

When the lender takes back a property after the mortgage has gone unpaid for a specified period of time, that’s a mortgage foreclosure. The process varies by state and by lender, but there are things you can do to avoid it.

Here’s what you need to know about foreclosure and moves you can make if you’re facing it.

Key Points

•   Mortgage foreclosure occurs when homeowners miss payments, leading to lenders reclaiming the property.

•   Reinstatement involves paying all overdue amounts to prevent foreclosure.

•   Forbearance agreements allow temporary reduction or pause in payments.

•   Loan modification changes terms to make payments more manageable.

•   Exploring these options helps avoid foreclosure and maintains financial stability.

What Does Foreclosure Mean?

When a buyer finances a home, the home mortgage loan is secured with the property, meaning the property is used as collateral on the loan. If the homeowner fails to make the agreed-upon payments on the due dates, the lender can take the property back. This is why it’s so important to think about what ifs as you go through the mortgage prequalification and mortgage preapproval process. How would you keep up payments in the event of a job loss? Do you have an emergency fund in place?

Each state has its own laws regarding foreclosure and its own state foreclosure rate. Where you live will determine how properties are foreclosed. There are two main types of mortgage foreclosure.

First-time homebuyers can
prequalify for a SoFi mortgage loan,
with as little as 3% down.

Questions? Call (888)-541-0398.

Recommended: Help Center for Mortgages

Types of Mortgage Foreclosure

In some states, the lender is required to go through the court system to foreclose on a property. This is known as judicial foreclosure. In other states, the lender does not have to go through the court process.

Judicial

With a judicial foreclosure, a lender must get a court order to foreclose on a property. The lender must file a complaint with the court, which is also sent to the homeowner and any other lienholders. Generally, the mortgage note must also be filed with the court.

Some states require loss mitigation efforts before a suit can be filed, meaning the mortgage servicer must work with the borrower to help them avoid foreclosure. Most of these foreclosures are not contested, resulting in a default judgment against the homeowner.

After this, the property may be scheduled for sale (usually a foreclosure sale or sheriff’s auction). The homeowner may appeal the foreclosure judgment.

Nonjudicial

In a nonjudicial foreclosure, deeds of trust can be foreclosed without going through the court system. Lenders must give special notice to the property owner and wait a specified amount of time before auctioning the property off.

Some states allow both judicial and nonjudicial foreclosure, while others may only allow one or the other. Below is a summary of states and what process they follow for mortgage foreclosure.

State Foreclosure process
Alabama Primarily nonjudicial
Alaska Primarily nonjudicial
Arizona Primarily nonjudicial
Arkansas Primarily nonjudicial
California Primarily nonjudicial
Colorado Primarily nonjudicial
Connecticut Primarily judicial
Delaware Primarily judicial
District of Columbia Primarily nonjudicial
Florida Primarily judicial
Georgia Primarily nonjudicial
Hawaii Primarily judicial
Idaho Primarily nonjudicial
Illinois Primarily judicial
Indiana Primarily judicial
Iowa Primarily judicial
Kansas Primarily judicial
Kentucky Primarily judicial
Louisiana Primarily judicial
Maine Primarily judicial
Maryland Primarily nonjudicial
Massachusetts Primarily nonjudicial
Michigan Primarily nonjudicial
Minnesota Primarily nonjudicial
Mississippi Primarily nonjudicial
Missouri Primarily nonjudicial
Montana Primarily nonjudicial
Nebraska Primarily nonjudicial
Nevada Primarily nonjudicial
New Hampshire Primarily nonjudicial
New Jersey Primarily judicial
New Mexico Primarily judicial
New York Primarily judicial
North Carolina Primarily nonjudicial
North Dakota Primarily judicial
Ohio Primarily judicial
Oklahoma Primarily nonjudicial
Oregon Primarily nonjudicial
Pennsylvania Primarily judicial
Puerto Rico Primarily judicial
Rhode Island Primarily nonjudicial
South Carolina Primarily judicial
South Dakota Primarily nonjudicial
Tennessee Primarily nonjudicial
Texas Primarily nonjudicial
Utah Primarily nonjudicial
Vermont Primarily judicial
Virginia Primarily nonjudicial
Washington Primarily nonjudicial
West Virginia Primarily nonjudicial
Wisconsin Primarily judicial
Wyoming Primarily nonjudicial

When Does Mortgage Foreclosure Begin?

Mortgage foreclosure begins with the first missed payment, though a lender’s actions will escalate the more payments a homeowner misses. With the first missed payment, the mortgage lender won’t take the property back, or even issue a notice of default, but will reach out to the borrower to help them get payments back on track.

The lender will also report a nonpayment or late payment to the credit bureaus and issue a late fee.

Typically, lenders won’t issue a notice of default until the borrower defaults on three missed payments, or 90 days past due (this is standard practice, but lenders can issue a notice of default sooner than 90 days). Default is the precursor to foreclosure.

Recommended: Home Loan Help Center

Foreclosure Timeline: How Long Does Mortgage Foreclosure Take?

Once the notice of default arrives after 90 days past due, the time it takes to complete the foreclosure will vary by state. In some states, it can be a matter of months. In others, much longer. In the last quarter of 2024, the average time a property took to complete foreclosure was 762 days.

In jurisdictions where each step of the process requires court approval (judicial foreclosures), court backlogs can delay the foreclosure processes for years.

Why Do Foreclosures Happen?

Foreclosure occurs in a number of situations. Some of the most common:

•   Being underwater. When a homeowner has negative equity in the home, the property is more likely to be foreclosed on. Having an underwater mortgage is the most common reason for foreclosure.

•   Rising interest rates. When a borrower’s loan has an adjustable interest rate, a sudden rise in the amount owed each month can lead down the path to foreclosure. With the 5/1 ARM, for example, the interest rate is fixed for the first five years and then adjusts once a year.

•   Mortgage types. Sometimes even the different kinds of mortgages can contribute to default. With an interest-only mortgage, for instance, after five or 10 years of interest payments, principal and interest kick in, resulting in higher payments.

•   Personal situations. When the payment on a mortgage loan becomes too much or when a life event (hospitalization, death, divorce, layoff) prevents homeowners from making monthly payments, they can slip into default and eventually foreclosure.

If the homeowner doesn’t work with the lender to make a plan for repayment of the missed payments, the mortgage servicer can seek foreclosure.

Can You Avoid Foreclosure?

Homeowners have options if they’re facing foreclosure, and the sooner they contact their mortgage lender or servicer, the more they will have. Some of these include:

•   Reinstatement. If you’re able to pay off the past due amounts and any penalty fees, the lender will stop the foreclosure process.

•   Repayment plan. A repayment plan allows you to tack on a portion of your past-due payments to your regular payment each month. This makes sense if you’ve only missed a small number of payments and will no longer have trouble making a monthly mortgage payment.

•   Forbearance. If you qualify for mortgage forbearance, your lender might pause or lower monthly mortgage payments for a short amount of time. When you start making payments again, you’ll add portions of your missed payments to your regular payment to catch up.

•   Loan modification. With a loan modification, the lender permanently alters the terms of the mortgage contract, so the payment is more manageable. This can include a reduced interest rate, adding missed payments to the loan balance, extending the term of the mortgage, or even canceling part of the mortgage debt.

•   Filing for bankruptcy. Filing for Chapter 13 bankruptcy may allow you to keep certain assets like a house or car. A court must approve your repayment plan. It stays on your credit report for seven years. You might want to consult with a bankruptcy attorney if you’re thinking about going this route.

•   Selling your home. If you have enough equity in your home to pay off the mortgage and pay for the cost of selling your home, you may be able to sell your home to avoid foreclosure.

•   Deed in lieu of foreclosure. A deed in lieu of foreclosure is essentially when you hand over the title of your home to the lender instead of going through a foreclosure. It is less damaging to your credit than a foreclosure. (Note: SoFi does not offer a Deed in Lieu at this time.)

•   Short sale. If the lender agrees to a short sale, it is agreeing to allow the home to be sold for less than what is owed. The deficit is taxable if the mortgage terms hold the borrower liable for the full amount of the loan.

Recommended: A Guide to Mortgage Relief Programs

Consequences of Foreclosure

Foreclosure has a huge impact on your credit. It will stay on your credit report for seven years after the first missed payment, and the multiple delinquent payments are a further knock against your credit scores, making it hard to go shopping for another mortgage and other loans.

After a foreclosure, it could take two to seven years to get a new conventional or government-backed mortgage.

But there are ways to deal with financial hardship. And a key first step where foreclosure is concerned is to reach out to your mortgage servicer and discuss a plan.

The Takeaway

Facing mortgage foreclosure is one of the toughest things a homeowner can go through. As the financial landscape shifts, knowledge is power. Foreclosure can be avoided if you work with your mortgage servicer and get help managing your debts. With time and a disciplined strategy in place, you can get on a solid financial footing again.

Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.

SoFi Mortgages: simple, smart, and so affordable.

FAQ

Can I stop the foreclosure process?

Possibly. The sooner you contact your mortgage servicer, the more options you will have.

How will foreclosure hurt my credit score?

The lender reports each missed payment, and the further behind a borrower gets, the more delinquent they become. The credit score lowers with each report. A foreclosure stays on a credit report for seven years, which makes it harder to apply for other credit lines and loans.

Am I supposed to pay property taxes when my house is in foreclosure?

It’s true that a missed tax payment can also lead to foreclosure proceedings, but it depends on where you are in the process. If you’re working with your lender to get your missed payments back on track to avoid foreclosure, then your escrow account will be replenished and the mortgage servicer will pay your taxes. If you’re in foreclosure and not able to get your payments back on track, paying your taxes won’t help you get your house back. You’re better off working with your lender to put that money toward missed mortgage payments.

Do I have to move out of my house when it is in foreclosure?

The Federal Trade Commission advises staying in the house as long as possible if you’re facing foreclosure. You may not qualify for certain types of assistance if you move out.

Photo credit: iStock/jhorrocks

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.

This article is not intended to be legal advice. Please consult an attorney for advice.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

SOHL-Q125-032

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Jan
23
2025
6-Step Guide to Buying a Manufactured Home

6-Step Guide to Buying a Manufactured Home

By | Home Ownership, mortgage | Comments Off on 6-Step Guide to Buying a Manufactured Home

If you’re looking at lower-cost housing options, buying a manufactured home may have come up on your radar. Buying a new manufactured home or an existing one could be a good way to get into a home more quickly and at a lower cost than purchasing a site-built home.

Manufactured homes shed their mobile home and trailer rep in 1976. Since then, manufacturers have touted their quick turnaround times and high-quality materials.

If you’ve ever wondered how to buy a manufactured home, what financing options are available, and whether the titling of a home as real property or personal property makes a difference, read on.

Key Points

•   Manufactured homes are built in factories, adhering to HUD standards.

•   Average costs are $86,600 for single-wide and $156,300 for double-wide models.

•   Various financing options are available, including personal loans and chattel mortgages.

•   Land must be purchased or leased, with considerations for regulations and suitability.

•   Regular maintenance can significantly extend the lifespan of a manufactured home.

What Is a Manufactured Home?

A manufactured home is built in a factory on a permanent steel chassis.

They often come in one, two, or three sections: single-, double-, or triple-wide. They must be able to fit on the highways, so the sections are limited to 16-foot widths in most states.

Manufactured homes are not modular homes; nor are they considered mobile homes anymore. Manufactured homes are built entirely in a factory, whereas the components of a modular home are taken to the land and put together on-site. The two types of housing also follow different building codes.

Mobile homes are considered those built before June 15, 1976, when the U.S. Department of Housing and Urban Development (HUD) implemented construction and safety standards for these structures. After that date, manufactured homes were required to follow the HUD Code. A manufactured home will have a “HUD tag,” a red metal certification label, on the exterior.

First-time homebuyers can
prequalify for a SoFi mortgage loan,
with as little as 3% down.

Questions? Call (888)-541-0398.

Why Should You Buy a Manufactured Home?

Manufactured homes are less expensive than site-built homes or modular homes, which must meet the same state and local building codes that stick-built homes do.

The average sale price of new manufactured homes nationwide was $86,600 for a single-wide and $156,300 for a double-wide as of late 2024, according to the Census Bureau’s Manufactured Housing Survey.

They have quicker build times than site-built homes, too.

Manufactured homes sold as part of a land package may hold their value much like a standard home, depending on upkeep and the local real estate market.

Speaking of land, if you’re a homebuyer and plan to lease the lot under you, beware of rising lot rents. Then again, if you’re looking for investment property, the ability to raise the lot rent could be a big draw.

Process of Buying a Manufactured Home

Buying a manufactured home is different from buying a site-built home. There are a lot of variables that you’ll need to know about.

Getting Financing for a Manufactured Home

Financing a manufactured home generally depends on whether the home will be attached to the land (real property) or consists of just the home (personal property, or chattel).

Financing Just the Home

It is possible to finance the manufactured home apart from the land. In this case, you’ll need to get a personal loan, a chattel mortgage, or dealer financing. A personal loan is unsecured (unlike a mortgage which is secured by your home), but its interest rates may be higher.

Another option is a government-insured home loan like an FHA Title I loan (which has loan limits). These loans are backed by the Federal Housing Administration and available from approved lenders.

Financing the Home and Land

If you’re buying a manufactured home that’s permanently attached to a foundation on its own land, some lenders will finance the purchase with a conventional home loan.

An FHA Title I loan can also be used for just a developed lot or for a home-lot combo. FHA Title II loans are for buying a manufactured home and land whose price is above the Title I loan amount. Title II loans adhere to FHA loan limits, which are based on a percentage of the Federal Housing Finance Agency’s national conforming loan limits for conventional loans.

VA loans, backed by the U.S. Department of Veterans Affairs, are available to eligible borrowers to buy a manufactured home that is permanently attached to the land.

And an option for low- to moderate-income buyers is a USDA loan if the home is in an eligible rural area identified by the U.S. Department of Agriculture.

Note: SoFi does not offer USDA loans at this time. However, SoFi does offer FHA, VA, and conventional loan options.

Recommended: What Is a Chattel Mortgage?

Searching for a Manufactured Home

In your search for a manufactured home, you’ll want to consider:

Manufacturer. Many companies build and sell manufactured homes. Keep your search broad at first, and ask friends and family for referrals. You may also want to keep a spreadsheet comparing the prices, incentives, and inclusions each company provides. Be mindful, however, that while some manufacturers are able to provide comprehensive services, the quality of their homes may be lower than that of another manufacturer that does not provide every service.

Model and layout. Tour models and figure out what you really need. Are there enough bedrooms? Do you prefer a separate kitchen and living room, or is an open layout more your style? Is there adequate storage?

Customization. There are a lot of options when it comes to selecting custom design elements. Would you like patio doors? A fireplace? Separate vanities? The manufactured home builder will have a list of upgrades that you’re able to select from.

Exterior additions. When your home is placed, some exterior elements can make it feel like a site-built home. Porches, garages, and decks are a few examples.

Site. Do some research on what it takes to place a manufactured home on a lot. Do you want a lot in the country with a view? Are you able to pay for the cost to bring utilities to raw land? Would you prefer to lease land? Where you want to place your home will help you select the right one. Your decisions will affect the total cost of a manufactured home.

Buying Land for a Manufactured Home

Buying land comes in three forms:

•   Cash. You can buy land with any savings you have on hand.

•   Land loan. It is possible to finance land separately from your home, which is also the case with some tiny houses. You’ll have closing costs on both loans if you choose to finance separately.

•   Home and land. The easiest route is a manufactured home-and-land loan. Getting loan approval before searching for land or a manufactured home will allow you to see exactly how much you qualify for.

Site Prep

After buying land, it will need to be prepared for your manufactured home. This may include:

•   Soil condition tests

•   Making a plan for where the manufactured home is to sit

•   Clearing the area

•   Grading for proper drainage

•   Checking the holding capacity for ground anchors

•   Sewer hookup or septic tank installation

•   Well drilling or water connection

•   Driveway

Recommended: Typical Personal Loan Requirements

Delivery and Installation of Your Manufactured Home

After your land has been prepared and the home has been built, it can be transported to the site and installed. Your manufacturer will likely coordinate delivery and may be able to help you find contractors to install the manufactured home.

Getting Insurance

Homeowners insurance for manufactured homes usually covers the structure, personal belongings, and any other structures on the property. Some insurers require that a manufactured home be placed on a concrete or block foundation.

The coverage might also include liability insurance, which helps protect your finances if you’re responsible for damage or injury to someone else. A standard policy may not cover earthquakes or floods.

To figure out how much homeowners insurance you need, start by getting enough dwelling coverage to fully replace your home if it needed to be rebuilt. The replacement cost may be higher or lower than the home’s value.


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$9,500‡ cash back when you close.

Cost of a Manufactured Home

The cost of a manufactured home will vary by size, quality, customizations, and manufacturer. Not including the cost of acquiring and developing land, a new model may range from $80,000 to over $200,000.

There’s that mention of land again. As the Consumer Financial Protection Bureau says, “Manufactured housing is the largest source of unsubsidized affordable housing in the United States, but financing a manufactured home can be costly, especially for borrowers who do not own the underlying land.”

To ease the housing shortage, the Biden administration’s 2024 “Housing Supply Action Plan” aimed to deploy new financing mechanisms for manufactured homes and accessory dwelling units (ADUs). The plan also prodded the Department of Transportation to modify its grant programs to favor cities that adopt zoning rules allowing dense housing and transit-oriented development.

Many states did update their regulations on manufactured housing in 2024 to expand the areas of land available for siting manufactured homes. So if you are considering purchasing a manufactured home, it’s smart to look into state and city regulations that apply to your town before making a decision, as they may have been updated recently.

The Takeaway

Buying a manufactured home is usually more affordable than a site-built or modular home, but it’s helpful to understand all the financing angles and the long-term stability that owning the land underneath you can bring.

Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.

SoFi Mortgages: simple, smart, and so affordable.

FAQ

How long do most manufactured homes last?

Manufactured homes that are regularly maintained can last for 30 to 55 years, according to HUD.

How do I pay for a manufactured home?

Financing a manufactured home largely depends on whether the home is permanently attached to the land or not. A home that is not may be financed with a personal loan, an FHA loan, a chattel mortgage, or a dealer loan.

How do I cut down on costs for a manufactured home?

The cost of a manufactured home itself could be relatively low. The biggest expenses you’ll likely encounter will be purchasing land and preparing it. If you can find a lot that already has utilities, it may help.

How is a converted shipping container classified?

Shipping containers that are converted into housing units can be accepted as manufactured homes if they are provided with a permanent chassis, are transported to the site on their own running gear, and otherwise comply with the HUD Code for manufactured homes.

Photo credit: iStock/Marje

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.

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.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

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.
†Veterans, Service members, and members of the National Guard or Reserve may be eligible for a loan guaranteed by the U.S. Department of Veterans Affairs. VA loans are subject to unique terms and conditions established by VA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. VA loans typically require a one-time funding fee except as may be exempted by VA guidelines. The fee may be financed or paid at closing. The amount of the fee depends on the type of loan, the total amount of the loan, and, depending on loan type, prior use of VA eligibility and down payment amount. The VA funding fee is typically non-refundable. SoFi is not affiliated with any government agency.
Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

‡Up to $9,500 cash back: HomeStory Rewards is offered by HomeStory Real Estate Services, a licensed real estate broker. HomeStory Real Estate Services is not affiliated with SoFi Bank, N.A. (SoFi). SoFi is not responsible for the program provided by HomeStory Real Estate Services. Obtaining a mortgage from SoFi is optional and not required to participate in the program offered by HomeStory Real Estate Services. The borrower may arrange for financing with any lender. Rebate amount based on home sale price, see table for details.

Qualifying for the reward requires using a real estate agent that participates in HomeStory’s broker to broker agreement to complete the real estate buy and/or sell transaction. You retain the right to negotiate buyer and or seller representation agreements. Upon successful close of the transaction, the Real Estate Agent pays a fee to HomeStory Real Estate Services. All Agents have been independently vetted by HomeStory to meet performance expectations required to participate in the program. If you are currently working with a REALTOR®, please disregard this notice. It is not our intention to solicit the offerings of other REALTORS®. A reward is not available where prohibited by state law, including Alaska, Iowa, Louisiana and Missouri. A reduced agent commission may be available for sellers in lieu of the reward in Mississippi, New Jersey, Oklahoma, and Oregon and should be discussed with the agent upon enrollment. No reward will be available for buyers in Mississippi, Oklahoma, and Oregon. A commission credit may be available for buyers in lieu of the reward in New Jersey and must be discussed with the agent upon enrollment and included in a Buyer Agency Agreement with Rebate Provision. Rewards in Kansas and Tennessee are required to be delivered by gift card.

HomeStory will issue the reward using the payment option you select and will be sent to the client enrolled in the program within 45 days of HomeStory Real Estate Services receipt of settlement statements and any other documentation reasonably required to calculate the applicable reward amount. Real estate agent fees and commissions still apply. Short sale transactions do not qualify for the reward. Depending on state regulations highlighted above, reward amount is based on sale price of the home purchased and/or sold and cannot exceed $9,500 per buy or sell transaction. Employer-sponsored relocations may preclude participation in the reward program offering. SoFi is not responsible for the reward.

SoFi Bank, N.A. (NMLS #696891) does not perform any activity that is or could be construed as unlicensed real estate activity, and SoFi is not licensed as a real estate broker. Agents of SoFi are not authorized to perform real estate activity.

If your property is currently listed with a REALTOR®, please disregard this notice. It is not our intention to solicit the offerings of other REALTORS®.

Reward is valid for 18 months from date of enrollment. After 18 months, you must re-enroll to be eligible for a reward.

SoFi loans subject to credit approval. Offer subject to change or cancellation without notice.

The trademarks, logos and names of other companies, products and services are the property of their respective owners.


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Jan
23
2025
Revolving vs Non-Revolving Credit: Key Differences

Revolving vs Non-Revolving Credit: Key Differences

By | Credit, credit card | Comments Off on Revolving vs Non-Revolving Credit: Key Differences

One important way that some types of loans or financial products differ is in whether they’re revolving or non-revolving credit. Revolving credit refers to a line of credit that you can access over and over again, subject to a total credit limit. Credit cards are one type of revolving credit.

Non-revolving credit, however, allows you to access a specific amount of money upfront and then pay down your balance. Once it’s paid off, you can no longer access the money. Student loans, auto loans, and mortgages are all examples of non-revolving credit.

Understanding the differences in revolving vs. non-revolving credit can allow you to better choose which financial product is right for your situation and understand how each can impact your credit.

Key Points

•   Revolving credit offers repeated access to funds up to a set limit, with interest charged only on the amount used.

•   Non-revolving credit provides a one-time lump sum, with interest on the full amount and no additional access without reapplying.

•   Revolving credit typically has higher interest rates compared to non-revolving credit.

•   Revolving credit affects credit scores through utilization ratio and payment history.

•   Non-revolving credit impacts credit scores mainly through payment history.

Understanding Revolving Credit and How It Works

Revolving credit is a type of credit that you can access over an extended period of time. As mentioned, how a credit card works is one example of revolving credit — you’re given a maximum credit limit, and as long as your outstanding balance remains below that limit, you can continue to use the card. As you pay down your balance, the amount of your revolving credit that you can use increases.

Another example is a personal line of credit. It works similarly to a credit card, with a maximum credit limit and a minimum payment required each month, but there is no physical card included. Instead, you can access the funds with a check, a transfer, or at an ATM. A popular line of credit option is a home equity line of credit (HELOC). In this case, the home serves as collateral, though not all lines of credit are secured.

How Does Revolving Credit Impact Your Credit Score?

Many forms of revolving debt are reported to the major credit bureaus and will show up on your credit report. This means that how you use your revolving credit will impact your credit score.

If you reliably pay off your credit balances each and every month, that will generally have a positive impact on your credit score. However, if you miss payments or carry a high balance, your credit score may go down. When you have a high balance vs. your credit limit, that creates a high credit utilization ratio, which can negatively impact your credit score.

Recommended: When Are Credit Card Payments Due?

Advantages of a Revolving Line of Credit

The biggest advantage of a revolving line of credit is that you’re able to access the funds as you need them. Instead of taking out a large lump sum, you can only borrow the money you need right now. This can help you save money on interest charges, since you only pay interest on your outstanding balance.

Whichever of the different types of credit cards you choose, it typically represents one of the most popular forms of revolving credit. With a credit card, you’re initially given a credit limit that represents the highest amount of money that you can borrow. As you make purchases, your amount of available credit decreases, but you can raise that amount by making payments to your account.

Recommended: Understanding Purchase Interest Charges on Credit Cards

What Is Non-Revolving Credit?

Non-revolving credit is another type of debt that you’ll want to be aware of. Some popular examples of non-revolving credit are auto loans, student loans, and mortgages.

With non-revolving credit, you receive all of your money upfront. As you make payments, your balance decreases, but you are not able to access any additional funds.

How Does Non-Revolving Credit Work?

If you have a non-revolving credit account, you will receive all of the funds you apply for upfront. One example of a non-revolving credit account is an auto loan. If you take out an auto loan, you get the total amount to buy your car at the outset. Then, you’ll make regular monthly payments, which decreases your outstanding balance.

But with a non-revolving credit account like an auto loan, you won’t be able to access any additional money without reapplying and requalifying with your lender.

Recommended: Does Applying For a Credit Card Hurt Your Credit Score?

Benefits of Non-Revolving Credit

One benefit of a non-revolving credit account is that you may be able to qualify for a higher amount and/or lower interest rates. Banks may be more willing to extend you additional credit (meaning a higher sum) on a non-revolving credit line, specifically because you won’t be able to continue to revolve the debt amount over time. To illustrate this point, consider the difference in the amount and interest rate between a typical mortgage (non-revolving) and credit card (revolving). According to Bankrate, in January 2025, the average fixed-rate interest on a 30-year conventional mortgage was 7.11% while the rate for a credit card was 20.15%.

Recommended: How to Avoid Interest on a Credit Card

Revolving Credit vs Non-Revolving Credit

Here’s a quick look at some of the differences between revolving credit vs. non-revolving credit:

Revolving Credit

 Non-Revolving Credit
Access to money Can access money over and over, subject to the total credit limit Just have access to the original amount borrowed
Interest charged Only on the amount outstanding On the full amount borrowed
Interest rate Often comes with higher interest rates Generally has lower interest rates
Purchasing power Relatively lower credit limits Can qualify for higher amounts

The Takeaway

Credit and debt accounts can be either revolving or non-revolving, and there’s an important difference between the two. With a non-revolving credit account, you receive all of the money at once, pay interest on the full amount borrowed, and you’re not able to access any additional funds without reapplying with your lender. With a revolving credit account (such as credit cards), you are only charged interest on the amount that you choose to borrow at any one time, and you can pay down your balance and access additional funds at any time.

Whether you're looking to build credit, apply for a new credit card, or save money with the cards you have, it's important to understand the options that are best for you. Learn more about credit cards by exploring this credit card guide.

FAQ

What is the major difference between revolving and non-revolving credit?

One of the biggest differences between revolving vs. non-revolving credit is how often you are able to access the money from your credit account. With a non-revolving credit account, you access the total amount upfront and then are not able to access any additional funds without reapplying. If you have a revolving credit account, you can continue to pay down your balance and access additional money, as long as your balance is below your maximum credit limit.

When should I use revolving credit?

A revolving credit account, such as a credit card, can be a great choice if you don’t have a fixed amount that you’re looking to borrow. If you have a revolving credit line, you’re able to borrow (and pay interest) only on what you need at any one time. And if you later find that you need to borrow additional funds, you can do so with a revolving line, as long as your outstanding balance remains below your total credit limit.

When does a revolving line of credit become mature?

Some revolving letters of credit come with a maturity date. Before the maturity date, you can access the line of credit, pay down the balance, and continue to access additional funds. This is often known as a “draw period.” After the maturity date when this draw period ends, the line of credit converts to non-revolving, and you are no longer able to access additional funds. Make sure to check the terms of your line of credit to understand how this may affect you.

Photo credit: iStock/staticnak1983

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.

This content is provided for informational and educational purposes only and should not be construed as financial advice.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

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.

Third Party Trademarks: Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®

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Jan
23
2025
20-Year vs 30-year Mortgages

20-Year vs 30-year Mortgages

By | Family Finances, Home Ownership, mortgage | Comments Off on 20-Year vs 30-year Mortgages

A 20-year mortgage is far less common than a 30-year mortgage, but when you want to pay a lower rate and save a substantial amount in interest, it’s worth considering a 20-year mortgage … with a big “if.”

If you can consistently afford the higher mortgage payments.

Get ready to learn all you need to know about 20-year mortgages, including what is a 20-year mortgage and how it compares with a 30-year mortgage. We’ll explore why people choose a 20-year mortgage and the advantages and disadvantages of a 20-year mortgage.

Key Points

•   A 20-year mortgage typically offers a lower interest rate and less total interest paid over the loan term.

•   A 20-year mortgage allows homeowners to pay off the loan faster and build equity more quickly.

•   Monthly payments for a 20-year mortgage are usually higher and may make qualification more challenging.

•   A 30-year mortgage provides lower monthly payments and easier qualification for borrowers.

•   Choosing between a 20-year and 30-year mortgage depends on financial goals and payment capability.

What Is a 20-Year Mortgage?

A 20-year fixed-rate mortgage is a home loan whose total financing costs are calculated on a repayment term of 20 years.

Homebuyers and refinancers choose their mortgage term. The 30-year fixed-rate mortgage is the most popular. The 15-year fixed-rate mortgage sometimes shares the spotlight.

The 20-year mortgage gets less attention. But a 20-year home loan may be a happy medium for homeowners who want lower monthly payments than a 15-year mortgage but who want to pay off the loan more quickly than 30 years.

First-time homebuyers can
prequalify for a SoFi mortgage loan,
with as little as 3% down.

Questions? Call (888)-541-0398.

Why Are 20-Year Mortgages Less Common Than 30-Year Mortgages?

When it comes to a 20-year vs. 30-year mortgage, why don’t more borrowers choose the shorter term? Because the monthly payments are higher.

A 30-year term makes a home more affordable on a monthly basis, even though homeowners will pay more over the life of the loan than they would over 20 years.

Buyers considering a 20-year home loan may need to lower the top end of their house-hunting price range so they can qualify for the mortgage.

In exchange for saving an awesome amount by financing with a 20-year loan, you may have to forgo perfection, buy a starter home, or consider a downsize.

Or downsize.

Recommended: How Much of a Mortgage Can I Afford?

Why People Choose 20-Year Mortgages

People who choose a 20-year mortgage do so because they will pay much less in interest than they would on a 30-year mortgage. That benefit stems from a shorter term and a lower interest rate.

Generally, the longer the term, the higher the rate on conventional conforming loans, FHA and VA loans, and jumbo loans.

An amortization table reveals how much interest is paid on a mortgage over the loan term. When you decrease the length of your mortgage in exchange for a higher monthly payment, the savings are substantial.

20-Year Mortgage

 30-Year Mortgage
Loan amount $500,000 $500,000
Fixed interest rate 6.0% 6.25%
Monthly payment (principal & interest) $3,582 $3,079
Total interest paid $359,752 $608,289
Total paid (loan amount + interest) $859,752 $1,108,289
Amount saved $248,537

It might be shocking to see nearly $250,000 in interest savings by financing a home with a 20-year mortgage.

If you can swing it, good deal! Keep in mind, though, whether you’re a millennial homebuyer or retiree, that a 30-year mortgage may give you wiggle room with your budget if you need it. And you can always pay off a 30-year mortgage early if you make extra payments toward the principal.

20-Year Fixed vs. an ARM

An adjustable-rate mortgage (ARM) may look good to a homebuyer who’s planning to stay put for just a few years. The introductory rate for a conventional ARM, jumbo ARM, or FHA or VA ARM may be lower than that of a fixed-rate mortgage.

Whether you’re interested in a 5/1 ARM, whose rate is fixed for five years and then will adjust once a year, a seven- or 10-year ARM, or any other adjustable-rate loan, you’ll want to know how long you plan to stay in the home and to fully understand the rate adjustments and caps.

Recommended: Mortgage Payment Calculator

Advantages of a 20-Year Mortgage

These are some of the benefits of a 20-year fixed-rate mortgage:

Fixed payments over 20 years: Your payment will be the same each month for the life of the loan.

Lower interest rate: 20-year mortgages typically have a lower interest rate than their 30-year counterparts. Lenders reward a shorter payoff date with a lower interest rate.

Pay less interest over 20 years: You’ll avoid 10 years of interest by paying on a 20-year loan instead of a 30-year loan.

Pay off mortgage sooner: A 20-year mortgage is scheduled to be paid off 10 years sooner than a 30-year mortgage.

Build equity more quickly: Equity is built faster with a 20-year loan than a 30-year loan. The sooner you can pay more on principal (which a 20-year loan naturally does), the sooner you’ll gain home equity.

Monthly payments still may be affordable: You may find that the payments for a 20-year loan are comfortable and doable.

Disadvantages of a 20-Year Mortgage

Here are some drawbacks of a 20-year loan:

Higher monthly payment: A 20-year vs. a 30-year mortgage will result in a higher monthly payment. This may make it more difficult to qualify for other financing, such as a loan for an investment property or a car.

Harder to qualify for: Because the monthly payments are higher, a 20-year home loan may be harder to qualify for than a 30-year loan.

Lower target price: If you’re in the homebuying process and want to finance your new purchase with a 20-year loan, you may need to shop for a home at a lower price point or in a more affordable location.


Get matched with a local
real estate agent and earn up to
$9,500‡ cash back when you close.

The Takeaway

If you’re looking for a home loan that could save you a significant amount of money in interest, a 20-year mortgage might be right for you — if you can handle the higher monthly payments without fail. If you need lower monthly payments, a 30-year mortgage may be the better move.

Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.

SoFi Mortgages: simple, smart, and so affordable.

FAQ

20-year mortgage vs. 30-year mortgage: Which has the better interest rate?

Decreasing the amount of time you repay your loan will help you save on interest costs in a big way. First off, the interest rate you’ll pay is typically lower. Second, your overall interest cost is much lower because you’re avoiding 10 years of interest that you would pay on a 30-year loan.

Is it harder to get a 20-year or 30-year mortgage?

A 20-year mortgage is harder to qualify for because the monthly payments will be higher for the property you want to purchase. If you’re determined to use a 20-year loan, you may find you’ll qualify for a lower purchase amount to get the numbers to work for your monthly budget.

Photo credit: iStock/ArLawKa AungTun

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.

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.
†Veterans, Service members, and members of the National Guard or Reserve may be eligible for a loan guaranteed by the U.S. Department of Veterans Affairs. VA loans are subject to unique terms and conditions established by VA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. VA loans typically require a one-time funding fee except as may be exempted by VA guidelines. The fee may be financed or paid at closing. The amount of the fee depends on the type of loan, the total amount of the loan, and, depending on loan type, prior use of VA eligibility and down payment amount. The VA funding fee is typically non-refundable. SoFi is not affiliated with any government agency.
‡Up to $9,500 cash back: HomeStory Rewards is offered by HomeStory Real Estate Services, a licensed real estate broker. HomeStory Real Estate Services is not affiliated with SoFi Bank, N.A. (SoFi). SoFi is not responsible for the program provided by HomeStory Real Estate Services. Obtaining a mortgage from SoFi is optional and not required to participate in the program offered by HomeStory Real Estate Services. The borrower may arrange for financing with any lender. Rebate amount based on home sale price, see table for details.

Qualifying for the reward requires using a real estate agent that participates in HomeStory’s broker to broker agreement to complete the real estate buy and/or sell transaction. You retain the right to negotiate buyer and or seller representation agreements. Upon successful close of the transaction, the Real Estate Agent pays a fee to HomeStory Real Estate Services. All Agents have been independently vetted by HomeStory to meet performance expectations required to participate in the program. If you are currently working with a REALTOR®, please disregard this notice. It is not our intention to solicit the offerings of other REALTORS®. A reward is not available where prohibited by state law, including Alaska, Iowa, Louisiana and Missouri. A reduced agent commission may be available for sellers in lieu of the reward in Mississippi, New Jersey, Oklahoma, and Oregon and should be discussed with the agent upon enrollment. No reward will be available for buyers in Mississippi, Oklahoma, and Oregon. A commission credit may be available for buyers in lieu of the reward in New Jersey and must be discussed with the agent upon enrollment and included in a Buyer Agency Agreement with Rebate Provision. Rewards in Kansas and Tennessee are required to be delivered by gift card.

HomeStory will issue the reward using the payment option you select and will be sent to the client enrolled in the program within 45 days of HomeStory Real Estate Services receipt of settlement statements and any other documentation reasonably required to calculate the applicable reward amount. Real estate agent fees and commissions still apply. Short sale transactions do not qualify for the reward. Depending on state regulations highlighted above, reward amount is based on sale price of the home purchased and/or sold and cannot exceed $9,500 per buy or sell transaction. Employer-sponsored relocations may preclude participation in the reward program offering. SoFi is not responsible for the reward.

SoFi Bank, N.A. (NMLS #696891) does not perform any activity that is or could be construed as unlicensed real estate activity, and SoFi is not licensed as a real estate broker. Agents of SoFi are not authorized to perform real estate activity.

If your property is currently listed with a REALTOR®, please disregard this notice. It is not our intention to solicit the offerings of other REALTORS®.

Reward is valid for 18 months from date of enrollment. After 18 months, you must re-enroll to be eligible for a reward.

SoFi loans subject to credit approval. Offer subject to change or cancellation without notice.

The trademarks, logos and names of other companies, products and services are the property of their respective owners.


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