If you’re looking to renovate your kitchen, consolidate debt or pay for another large expense, you might be searching for a $15,000 personal loan. There are plenty of lenders that offer $15,000 loans, so it’s worth shopping around to find the lowest rates and fees. Lenders typically offer the best rates to borrowers with strong credit and a stable income.
Follow these five steps to get a $15,000 loan.
1. Consider Qualification Requirements
Before approving you for a $15,000 loan, lenders review your credit, income and other factors. While lending criteria will vary by institution, some common personal loan qualification requirements include:
- Credit. Lenders review your credit to assess your risk as a borrower. Borrowers with good credit (at least 670 on the FICO scoring model) tend to get the best rates. You can check your credit score for free with Experian and Equifax or purchase it from myFICO.com. You can also review your credit history with a free annual report from AnnualCreditReport.com.
- Income. You’ll also need a stable source of income to qualify for the loan. Lenders ask for pay stubs, W-2s or other documentation to ensure you have the funds to pay back the amount you borrow.
- Debt-to-income (DTI) ratio. When reviewing your application, lenders also look at your DTI ratio, which shows your monthly debt payments compared to your gross monthly income. Aim for a DTI ratio of 35% or less.
2. Prequalify With Multiple Lenders
A $15,000 loan is a hefty sum, so it’s worth shopping around to find the best rate. Many lenders let you prequalify for a loan online, meaning you can check what rates you may be eligible for with no impact on your credit score or obligation to borrow.
Prequalification only takes a minute or two. You’ll enter some basic personal details and consent to a soft credit inquiry. After submitting your details, the lender will show you which offers you qualify for.
3. Compare Your Offers
Once you’ve collected some loan offers, take some time to compare the details of each. Pay close attention to interest rate and fees, including origination, disbursement, application and prepayment fees.
The annual percentage rate (APR) is a more inclusive rate than the interest rate alone because it accounts for both interest and fees. The loan with the lowest APR will generally be the most affordable one.
The repayment terms you choose also impact your costs of borrowing. Lenders sometimes offer better rates on shorter loan terms and higher rates on longer terms.
4. Complete and Submit Your Application
Once you’ve selected a loan offer, your next step is to fill out and submit your application. This application will collect more details than the prequalification form did.
You’ll fill in your personal information, such as your contact details and address, as well as indicate the purpose of your loan. You’ll also upload verifying documentation, such as an ID, proof of address, pay stubs and W-2s.
Once you’ve signed and submitted your application, the lender will run a hard credit inquiry to review your credit profile. Unlike the soft credit pull, this hard credit check could ding your credit score by a few points. However, your score should bounce back quickly as long as you make on-time payments on your loan.
5. Manage and Repay Your Loan
After you complete your application, the lender will review your information and check your credit. This process may take a few days or weeks, but some lenders can approve loans within 24 to 48 hours.
Once approved, the lender will disburse the proceeds into your bank account, which you can use to pay for any approved expense. Review your paperwork to find out when your first payment is due. You’ll repay the loan on a monthly basis.
Some lenders offer a rate discount if you set up automatic payments from your bank account. Even if your lender doesn’t offer this rate cut, it could be a good idea to set up autopay so you don’t miss a payment.
How to Get a $15,000 Loan With Bad Credit
Having bad credit can limit your options for a $15,000 loan. However, it’s still worth shopping around because some lenders have more flexible credit requirements than others. Start with your current bank or credit union, since it might offer perks to existing customers.
You could also search for a secured personal loan rather than an unsecured loan. Secured personal loans are backed by collateral, such as a car title or savings account. They tend to have more lax credit requirements, but you risk losing your asset if you fall behind on payments.
Some lenders also let you apply with a co-signer or co-borrower to make up for limited credit. Adding a creditworthy co-signer or co-borrower to your application could help you qualify for a $15,000 loan if you can’t meet a lender’s requirements on your own.
Finally, you could take steps to improve your credit score before you apply if you don’t need the loan immediately. If you spot any errors on your credit report, dispute them. Paying down current loan balances and lowering your credit utilization ratio can also improve your score.
Where to Get a $15,000 Loan
Long-term Costs of a $15,000 Loan
When you borrow a $15,000 loan, you’ll end up paying back more than $15,000. That’s because interest charges and fees add to your borrowing costs.
Your long-term costs will vary depending on your rate, fee structure and repayment terms. A higher interest rate will add to your costs while a lower rate will make your loan more affordable.
Let’s say you borrow a $15,000 loan with a five-year repayment term. If you get a 10% rate, expect to pay $4,122.34 in interest over the life of your loan. If you can qualify for a 6% rate, your total interest charges drop to $2,399.52.
The repayment term you choose also impacts your long-term costs. A shorter term typically means lower interest charges while a longer term means you’ll pay more in interest over the life of the loan.
Let’s go back to that example of a $15,000 loan at a 10% rate. As mentioned, a five-year term equates to just over $4,100 in interest charges. But your interest charges will only be $2,424.28 with a three-year term. Alternatively, a seven-year term would mean interest charges of $5,917.49.
Use a Calculator to Estimate Your Loan Costs
The Forbes Advisor personal loan calculator can help you estimate your long-term costs of borrowing a $15,000 loan on different repayment terms. As you’re crunching the numbers, try to find a term that makes your monthly loan payment affordable while keeping long-term interest costs down.
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- Today’s Personal Loan Rates: November 8, 2022—Rates Rise For Well-Qualified Borrowers
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