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Many lenders offer personal loans of $35,000, and a loan that size could help you meet your financial needs, like consolidating credit card debt, financing wedding costs, or paying out-of-pocket costs for surgery.
When applying for a $35,000 loan, lenders will consider your income and credit to determine your ability to repay the loan, but there are other qualifications and steps you’ll want to consider. Here’s what you need to know about $35,000 loans and how to apply for and find the best personal loan for you.
1. Consider qualification requirements
Each lender has its own personal loan qualification requirements. However, three key factors affect what you can borrow:
- Income. You must have a history of a consistent source of income to show that you can repay your loan, especially when you are borrowing a large amount. Lenders may consider income from a full-time or part-time job, alimony, child support, disability income, rental income, and more to make an approval decision.
- Credit. The odds of getting approved for a $35,000 loan increase with a higher credit score. In general, aim for a credit score of 670 or higher when applying for a personal loan. A higher credit score could help you qualify for a lower interest rate.
- Debt-to-income ratio. Your debt-to-income (DTI) ratio is the percentage of your monthly income that goes toward paying down debt. In general, lenders prefer a DTI of 36% or less. Having a low DTI can increase the loan amount you may qualify for, as it shows you have the financial resources to manage higher payments.
2. Prequalify with multiple lenders
After reviewing the loan eligibility requirements, the next step is to prequalify to see the rates and terms you may be eligible for. Many online lenders, banks, and credit unions allow you to prequalify directly on their website.
Alternatively, you can pre-qualify for loans through an online loan marketplace. Using a loan marketplace can speed up the process by showing you multiple offers after you submit a form.
Prequalifying for personal loans usually doesn’t involve a thorough credit check, so it won’t affect your credit score. However, the offers are only preliminary, which means you must complete a complete application and undergo verification before you can get the loan. Prequalification forms typically ask you for information such as how much you need to borrow, your income, and your credit score range.
3. Compare your pre-qualified offers
Once you have a few pre-qualified offers, compare them using the following factors to determine which $35,000 loan best suits your needs:
- Annual percentage rate. The annual percentage rate (APR) shows how much it will cost you to borrow each year, including interest and fees. APRs will show you which loan options cost the least.
- Fee. Lenders may charge origination fees or other fees that you will need to factor into the cost equation. If the lender charges a fee for a personal loan, it is usually 1% to 8%. Charges may be based on your credit and how much you are borrowing.
- Refund conditions. Your payment term, or the length of time you have to pay off your loan, will affect your monthly payment. The longer the term of your loan, the lower your monthly payment will be, but you’ll likely pay more interest because you’ll be repaying the loan over a longer period of time. Shorter loan terms may have higher payments, but you’ll pay less interest and the debt will be paid off sooner, often making them a better option. What works for you will depend on your budget and needs.
- Financing speed. The time frame for application and approval may vary by lender. Comparing processing times can help you find a lender with an approval speed that meets your needs.
4. Complete and submit your application
Once you choose a loan offer, you will need to complete the full loan application. This process typically involves providing documentation to confirm your identity along with pay stubs or tax documents to confirm your income.
The lender will also likely do a hard credit inquiry at this point to check your credit, and this credit inquiry may show up on your credit report and affect your score. Once approved, you will do a final review of the loan terms and sign the loan documents. Loan funds can be disbursed directly into the bank account of your choice, or your lender will send you a paper check.
5. Manage and pay off your loan
Your lender will tell you when to start making loan payments, and in most cases, you will have an online account to check your balance and make payments.
Depending on the credit bureaus your lender reports to, your loan and payment records will appear on your credit report. Paying bills on time can have a positive impact on your credit score, while paying late can hurt your credit. Enrolling in automatic payment could help you avoid missing a payment and incurring late fees.
How to get a $35,000 loan with bad credit
Having bad credit means you are a higher risk borrower, but that doesn’t mean you can’t get a personal loan with bad credit.
Applying for a loan with a co-signer or co-borrower is one way to overcome the hurdle of bad credit. When you apply with someone else, your income and credit are included in the application, and your signature on the loan means that you personally guarantee payment. This added guarantee to the lender can help you get approved, and in some cases, with a lower interest rate.
Looking for secured personal loans can be another way to borrow a large sum with less than perfect credit. Some lenders offer personal loans backed by money in a savings account, called passbook loans, and other collateral. That security might make it easier to qualify for them, but keep in mind: If you default on your loan, the lender could take your collateral.
Where to get a $35,000 loan
Online lenders, banks, and credit unions can offer loans of $35,000. Below are the characteristics of the loans offered by each category of lender:
- traditional banks They may have higher credit and income requirements for loans than credit unions and online lenders, but they may also offer lower interest rates and no origination fees. If you have good credit, getting approved for a bank loan could be an inexpensive way to get a loan.
- credit unions They can be another good option because they can provide lower-cost loans to members. Some credit unions have flexible membership fields that aren’t limited to people who live in a certain area, so you can apply to join online and then get a loan.
- online lenders They are known for their fast application and funding processes. They also often have flexible borrower qualification criteria and competitive rates.
Long-term costs of a $35,000 loan
The long-term cost of a personal loan of $35,000 depends on the interest rate and the term of the loan. Below are examples of monthly payments and total interest paid for a $35,000 loan.
Entering sample loan terms, interest rates, and loan amounts into a personal loan calculator can help you estimate the monthly payments and total interest costs of loans before you borrow.
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