Even though student loan debt has gone well over a trillion dollars, we have seen very little innovation from the lenders in the industry. Outside of differing interest rates and lengths of repayment, it can be hard to separate one lender from the next. This lack of innovation is definitely not to the advantage of the borrower.
However, if you look carefully, there are programs that are both unique and worth highlighting. While researching for my SoFi review, I came across one such program. Specifically, I saw a testimonial stating that SoFi actually helped a borrower find a new job.
The idea of a lender helping a borrower find work seems a little too good to be true. However, digging a little bit deeper the idea not only seems reasonable, but it seems like something that every borrower should want from their lender.
Lenders want money from their borrowers. In order for borrowers to give lenders money, they need a job.
SoFi has decided that instead of hoping that their borrowers get jobs, they will become an active participant in the process. They now offer career services headed up by a former Assistant Dean of Career Services at the highly regarded University of Rochester School of Business.
Anyone who has ever struggled in the job market will tell you that there is no such thing as too many resources or too many connections to have. Counting on your lender to find you a job is probably ill advised, but having access to additional career services is a huge advantage. At the very least, having an industry professional with resume building and networking assistance could help give you an edge.
Why hasn’t this been done before?
It seems like it would be in the best interest of lenders to offer career placement assistance, but why is it the exception and not the rule? Wouldn’t the same logic apply to credit card companies, mortgage brokers, and any other debt holders?
Hiring skilled professionals is expensive. As anyone who has ever called with questions about their federal loans knows, most lenders opt for the cheapest alternative. Having the staff in place to not only respond to job placement questions, but to actively assist in securing employment is a huge expenditure.
SoFi seems to have made the calculated risk that their career services will help enough people find work to justify the cost of the services.
Less Obvious Benefits
Spend enough time working with any career advisor and they will likely have a pretty good idea of your credentials and career outlook. If that advisor happens to work for your lender, they may be in your corner when it comes to working out repayment options while you are unemployed. If your lender knows the effort your are putting in to your job search and your qualifications, they may be more willing to find a way to accommodate your economic downturn. From the lender perspective, they know the borrowers who are working the hardest and in the best position to find new work. Again, another win-win for the borrower and the lender.
What is the future of lender career services?
Hopefully word spreads quickly on this career assistance program. Once lenders in competition with SoFi realize that they are losing business because they don’t have the program, they will have to move quickly to either match it or better it.
Lenders offering career guidance isn’t a solution to the student debt crisis, but at a time where some colleges offer next to no career assistance, it is a huge step in the right direction.
Readers: What do you think of this program? What would you want to know about it before you got a loan?