Private student lender SoFi announced last week that it secured a $50 million lending facility from East West Bank, allowing the company to increase funding capacity and refinance student loans.
“This facility provides us with increased flexibility to deliver the best possible rates to our borrowers,” SoFi CFO Nino Fanlo said. “East West Bank is the type of innovative bank we want to partner with to maximize our impact on the student loan market, and we look forward to expanding our relationship.”
The agreement brings SoFi’s warehouse capacity to $150 million total, including facilities from Morgan Stanley, Bancorp and East West. The funds supplement funds from alumni and other community investors.
“We are excited to work with the SoFi team,” Marty Newton, the executive vice president and head of specialty lending at East West, said. “Social Finance provides a valuable and needed service to the private student loan marketplace and in turn is helping many qualified students manage their financial debt in an appropriate manner.”
SoFi focuses on building community around traditional financial products, connecting students and recent graduates with alumni and other community investors through school-specific student loans. Investors earn an attractive return, and borrowers receive a lower rate than private and federal options. Since its establishment in 2011, SoFi has funded nearly $140 million in loans to students and alumni.