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To get a $70,000 loan, you’ll need to meet stringent borrowing requirements. (iStock)
The average personal loan balance is around $16,000, and Americans have nearly 43 million personal loan accounts, according to Experian. But what if you need a large personal loan — like $70,000?
You’ll likely need good to excellent credit to qualify for a $70,000 personal loan, although you may be able to qualify with a cosigner if your credit is only good or fair.
Where to get a $70,000 personal loan
You can find a $70,000 personal loan at some banks and online lenders. But you might not have that many options, as few lenders offer personal loans this large. In fact, many credit unions don’t offer $70,000 personal loans at all. The application process is typically the same, but the time to fund can vary greatly.
Online lenders
An online loan is typically both convenient and practical. You might also have a few more options to choose from when you’re looking for a $70,000 loan from an online lender. But some online lenders charge higher fees and interest rates for borrowers with poor credit.
Once you’re approved for a personal loan from an online lender, you can generally get your money quickly. Many online lenders can fund a loan as quickly as the next business day, although five days or fewer is typical.
You can find lenders who offer $70,000 personal loans and compare rates using Credible.
Banks and credit unions
It may be difficult to find a bank that offers personal loans for more than $50,000, even if you have excellent credit. That’s why it pays to shop around. Also, if you have a long-standing relationship with a bank, they may be willing to go the extra mile for you.
As with banks, it may be difficult to find a credit union that offers $70,000 personal loans. You’ll have to join the credit union (and meet its membership eligibility requirements) in order to get a loan, but if you do qualify, you may find more favorable rates. Since credit unions are member-owned and not-for-profit entities, they tend to have better interest rates than other options.
How do I apply for a $70,000 loan?
To qualify for such a large amount, you’ll need to prepare. Check out these tips to put your best foot forward when you apply:
- Crunch the numbers. Use a personal loan calculator to get an idea of how manageable your loan payments will be.
- Check your credit score. Your credit score can be a deciding factor in the approval process for your loan. It’ll also affect your APR significantly. Improving your credit before applying can often mean the difference between qualifying for a $70,000 loan and finding alternative funding.
- Estimate monthly payments. Based on your income and general expenses, determine how much you feel you can comfortably afford each month. This will give you an idea of the terms you’ll need to meet your monthly payments.
- Compare lenders. You may find only a handful of lenders willing to offer a $70,000 personal loan. Even so, take the time to compare lenders to find out if they offer secured or unsecured loans, and what APR they offer.
- Seek pre-approval. Take advantage of pre-approval if it’s available. It won’t affect your credit score, but it can give you an idea of what your monthly payments might be.
- Gather your paperwork. Lenders will want to see your employment history and proof of income. They’ll also look at your current debts, assets, and latest tax returns. If you already have this information in hand, it can greatly speed up the process.
- Review your loan agreement. Read your loan agreement carefully. If you’re happy with the terms of your loan, sign it. Many lenders will deposit your loan funds within a few days, although some may take longer.
How much will a $70,000 loan cost?
How much your $70,000 loan will cost depends on factors like your interest rate and repayment term. Generally, a longer repayment term will come with a higher interest rate and higher overall costs. Good credit and a shorter term typically qualify you for a lower interest rate.
For example:
- A $70,000 loan at 10% for seven years — With a $70,000 loan and these terms, your monthly payment will be $1,162, and you’ll pay a total of $27,615 in interest over the term of your loan. Factoring in both loan principal and interest, the total amount you’ll pay will be $97,614 over the life of the loan.
- A $70,000 loan at 6% for three years — With a $70,000 loan and these terms, your monthly payment will be $2,130, and you’ll pay a total of $6,663 in interest over the term of your loan. Factoring in your loan principal and interest, your total payments will add up to $76,663 over the life of the loan.
Credible makes it easy to see your prequalified personal loan rates from multiple lenders in minutes.
How can I qualify for a large loan?
You’ll typically need good to excellent credit — a score of 650 or higher — to qualify for a $70,000 personal loan, and to get the lowest rates available. You may qualify with less-than-stellar credit, but in this instance, you may need collateral. To better your chances of getting a $70,000 loan, take these steps:
- Pay down other debt if you can. Lenders will check your credit and look at factors like your outstanding debts and repayment history. They use this information to assess the risk of lending to you. Paying down your current debt will lower your credit utilization ratio and may help you qualify for your loan without offering collateral.
- Work on improving your credit. Your credit score is an important factor in the approval process. It also determines the APR and terms of your loan. Most larger loans require good to excellent credit. Factors that can affect your credit score include your credit history, age and mix of credit accounts, new credit applications, your credit utilization ratio, and total debt. Also, be sure to pay your credit card, car, mortgage, and all other bills on time.
- Improve your debt-to-income ratio. Lenders look at your debt-to-income ratio (DTI) to decide if you can afford to take on more debt and make another monthly payment. To improve your DTI, don’t take on any new debt, pay down existing debt (if possible), and reduce your spending.
- Get a cosigner. If you’re worried that your credit score will hold you back from qualifying for a$70,000 loan, or that you’ll get a loan at a higher rate, you might consider using a cosigner with good or excellent credit. But remember, if you miss payments or default on your loan, your cosigner is obligated to repay the loan.
- Offer collateral. Personal loans are generally unsecured, meaning you don’t need collateral to qualify. But if your credit score keeps you from qualifying and you have assets, you may consider a secured personal loan.
What to consider when comparing $70,000 loans
Qualifying for a $70,000 personal loan may not be as easy as qualifying for a loan for a smaller amount. And your monthly payments are likely to be high. For example, if you took out a personal loan for $15,000 with an interest rate of 10% and a five-year repayment term, your monthly payment would be around $300. But a $70,000 loan with the same rate and repayment term would give you a monthly payment of more than $1,400 a month.
Here are a few key points to consider when comparing loans:
- Interest rate and APR — Lenders use the interest rate to calculate the interest expense on your loan. The annual percentage rate, or APR, includes both the interest and all fees and other costs attached to your loan.
- Repayment terms — This is the time frame in which you’ll be required to repay the loan with interest. Personal loans are generally shorter-term loans, but you may find some for up to 10 years. Generally, shorter loan terms come with lower interest rates. Longer repayment terms typically give you a lower monthly payment but higher total interest costs. Be sure to read your loan agreement carefully to know whether your loan comes with a prepayment penalty.
- Fees — Some lenders charge fees for taking out a loan, which can increase the cost of your loan. This may include loan application fees, origination fees, late payment fees, annual fees, and prepayment penalties.
- Total interest cost over the life of the loan — This is the interest you’ll pay over the life of the loan, based on the original loan amount. Interest rates can range from around 4.99% up to 36%. Your actual rate will depend on your repayment term, your credit score, and your credit profile.
- Monthly payment amount — Your monthly payment is determined by the loan amount, the interest rate on your loan, and loan term.
Personal loan FAQs
What is a personal loan?
Personal loans are installment loans that you can use for virtually any purpose. They’re generally unsecured — meaning you don’t have to put up collateral to get one. But some personal loans are secured with collateral.
What are personal loan fees?
Some lenders charge fees to take out a personal loan. Common fees include origination fees, which cover the cost of processing a loan, late fees for not making on-time payments, and application fees. Some lenders may also charge a prepayment penalty if you pay off the loan early.
What is the repayment term?
If approved for a personal loan, you’ll receive your funds in a lump sum. You’ll repay the loan over a period of months — usually one to five years.
How quickly can I get my money from a personal loan?
In many instances, once you submit your application, you could get a decision and have the funds deposited into your bank account as soon as the next business day.
You can compare rates from personal loan lenders who offer loans as high as $100,000 using Credible.
What can (and can’t) I use a personal loan for?
You can use a personal loan for many reasons, including …
- Making home improvements
- Paying off high-interest debt
- Consolidating credit card debt
- Paying for unexpected medical costs
- Paying down a large tax bill
But you should avoid taking out a personal loan to …
- Pay off student loan debt — Your student loan interest rates are likely lower than a rate you’d get on a personal loan.
- Buy a car — An auto loan will likely have a better interest rate. Plus, personal loan lenders may specify that you can’t use their loans for vehicle purchases.
- Make investments — Borrowing to fund investments is never a good idea.
What’s the difference between APR and interest rate?
Lenders make money by charging interest. They apply the interest rate to the principal borrowed to calculate the total interest you’ll owe.
The annual percentage rate, or APR, includes the interest rate and any fees associated with the loan. Because APR considers all the expenses associated with the loan, it’s a better indicator of a loan’s total cost.
Before committing to a personal loan, it’s a good idea to compare rates. Credible makes it easy to see rates from multiple lenders.
