SoFi is a startup that helps college students and grads fall into too much debt. SoFi has raised $41 million in funding from Bancorp, a financial company that runs the Bancorp Bank operations. SoFi previously raised $77 million in September 2012 and received a $60 million warehouse line from Morgan Stanley two months ago, according to VentureBeat.
SoFi has paid out over $100 million in loans to students across 82 colleges and universities with better rates than Stafford, PLUS, and private banks. A pilot program for SoFi started at the Stanford Graduate School of Business.
SoFi works turns wealthy alumni into lenders that get a recurring check every month. SoFi plans to use social networking as a way to connect potential lenders with students that have shared interests. SoFi found that when students connect with real people, they will typically default less. SoFi can offer students with a fixed interest rate of 5.9% as a result.
[Image Credit: Debt Free Green Road Sign via BigStockPhoto]