After roughly a year to get finalized, SoFi officially received its license to lend in New York, which is one of the most difficult states to acquire a license in, Michael Tannenbaum, SoFi’s chief revenue officer, said in an interview.
Tannenbaum stated that SoFi has always wanted to be in New York, especially since it already has a lot of existing customers there.
However, he noted that there are a lot of nuances to New York licensing and not too many out of state lenders receive approval.
New York would be a potential gold mine market for SoFi, which only entered into the mortgage market back in 2014.
The San Francisco-based online mortgage lender got its start in the student loan arena, and once it broke into mortgages, it was able to transfer a lot of its already existing student loan borrowers into mortgage borrowers.
SoFi tends to target its marketing to an elite group of borrowers usually deemed as “great” in its ad campaigns, or Henrys, High earners not rich yet. New York is expected to fit this borrower profile well.
“When you think about it, San Francisco is a concentrated market,” said Tannenbaum. “We expect New York to be similar. It’ll be a huge win for us.”
It’s a very concentrated market that already has an awareness of SoFi and will likely be as large as California in business, which is SoFi’s No. 1 market, he noted. Washington State is slated as SoFi’s No. 2 market right now. SoFi is currently licensed in 29 states, also jumping into Montana recently.
From here, Tannenbaum said Massachusetts would be the last remaining big state that SoFi needs to jump into, pointing out the potential Boston could bring, especially since SoFi already has a solid student loan base there.
This news follows SoFi’s announcement back in November that it partnered with Fannie Mae for a new loan option that allows homeowners to refinance their mortgage at a lower rate and pay down the balance of an existing student loan.
Between the new refi product and breaking into New York, SoFi is positive on its growth for 2017.
Tannenbaum added that mortgage is the biggest growth driver for SoFi, and they project mortgage production to triple this year.