What to know about getting a $70,000 personal loan

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You can use a personal loan for many reasons, but if you’re looking for a higher amount, qualifying will be tougher. (iStock)

People take out personal loans for many reasons, from covering an unexpected medical expense or a big-ticket purchase, to consolidating higher-interest credit card debt. Personal loans provide fixed monthly payments and relatively low interest rates, and you can generally get one even with less-than-perfect credit.

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?

Here’s how to get a $70,000 personal loan, and everything you need to know about eligibility requirements. 

What to know about personal loans

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.

Online lenders, banks, and credit unions are sources of personal loans. Some lenders charge fees to take out a personal loan, while others may charge a penalty if you pay off the loan early. 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.

In many instances, once you submit your online application, you could get a decision and have the funds deposited into your bank account as early 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 debt
  • Paying for unexpected medical costs
  • Paying down a large tax bill

However, you should avoid taking 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.

How can I qualify for a large loan?

Usually, you'll 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 your credit score will hold you back from qualifying for your $70,000 loan, you might consider using a qualified cosigner. But remember, if you miss payments or default on your loan, your cosigner is obligated to repay the loan.
  • Offer collateral. Generally, personal loans are unsecured, meaning you need no collateral to qualify. However, if your credit score keeps you from qualifying and you have assets, you may consider a secured personal loan.

Where can I get a $70,000 personal loan?

You can find a $70,000 personal loan at some banks and online lenders. You might not have that many options, however, 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 funding can differ greatly. 

Banks

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. 

Credit unions

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.  

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. 

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 (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.

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 your $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 impact your credit score, but it can give you an idea of your monthly payments.
  • Gather your paperwork — Lenders will want to see your employment history and proof of income. They’ll also take a 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.

Alternatives to a $70,000 personal loan

Sometimes the best option is an alternative to a $70,000 personal loan. So if you’re struggling to find a lender or to get approved, here are some other options to consider:

  • Explore payment plans — If you need the money for a big expense like a medical procedure, research payment plans that charge little or no interest and may be manageable for you.
  • See if you can borrow less — If you’re having trouble qualifying for such a large amount, you may be able to get a smaller amount to help pay down debt or fund your large purchase.
  • Tap into your home’s equity — Although not the best option, home equity lines of credit (HELOCs) and home equity loans may be easier to get if you have equity in your home. But there are limits on how much homeowners can borrow and significant risks in turning unsecured debt into debt secured by your home.
  • Put your 401(k) to use — A 401(k) loan allows you to borrow funds built up in an employer-sponsored retirement plan. If your employer allows these loans, you generally don’t need to submit an application or meet minimum credit score requirements to get one. But be sure you can repay the loan quickly to minimize the impact on your retirement savings.
  • A personal line of credit — This lets you borrow only the funds you need, up to a limit. Plus, credit limits can often be much higher than a credit card. 
  • Credit card — Credit cards typically come with higher interest rates than personal loans, so you’ll want to pay off any balance on your card as quickly as possible. And it may be difficult to qualify for a single card with such a high credit limit.