A question about Personal Loans

[Nikolai Matveev]

I have a wedding planned for the end of March. I want to get a personal loan in order to pay for it. 

I make $58,000 a year. I don't have any car payments already paid my car off. I pay $875 and rent. My credit score is somewhere in the 730 to 780 range depending on where you look. Fico says I'm 786 while another one says I'm 732 which dropped from 754 because I added $750 to my credit cards (which I since paid off). I have $5000 credit line on 2 different credit cards which I keep close to 0% at all times. 

I have been with the same bank (Wells Fargo) for the past 10 years. They have my automatic deposits from the same job for the past 6+ years. The one I'm working at now. So it wouldn't be hard for them to verify my income is what I say it is.

I don't have any collateral to offer I would be looking at an unsecured loan.

I would like to get $15,000-20,000 if possible. But I'm not sure how much I can realistically apply for. I want to do a long term payment plan because I know I can easily afford $400-500 monthly payments. I would likely pay it off much faster than the actual term.

Someone suggested getting a bunch of credit cards instead. But I'm worried that trying to apply for say $20,000 worth of credit limit would do a lot of damage to my credit. Nor do I even know if it's possible. Most of the pre-approved offers I get only have like $1000 credit line in the beginning. I don't think its wise to open 20 credit cards. 

So I come to you good people for advice? Can I talk to a Financial specialist about this? 

Thank you ahead of time for your help. 

[Doug Smith]

Hi @Nikolai Matveev, We're right down the road from one another. 

I was a banker for 25 years before joining Castle Rock and I have worked with thousands of people in similar situations. Since I no longer do that sort of thing, I feel I can give you strong advice without it sounding as if I was selling you something.

Commercial Retail Banks are not set up to make smaller personal loans. They do them, but the rates aren’t going to be much different than credit card rates when you factor in the loan fees that they charge to make the loans (credit cards usually aren’t going to have them. Since you have credit scores in the mid-to-upper 700s with very little debt load, I would suspect that you can get some great deals on cards. Some cards will even give you an incredibly low interest rate for a little while after the card is activated. Based on what you are telling us, I think you will be surprised at the deals you can get.

I would avoid using consumer finance companies. Their rates and fees are going to be incredibly high. My advice would be to put as much down as you can comfortably do and then grab a couple good, mainstream cards (Chase, Capital One, etc) to complete the difference.

I would simply be very, very careful not to overextend and pay them down as soon as practical. Good luck and congratulations on your wedding!