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Personal Loan Denial - Avg Age of Credit & # of Inquiries
Hi all,

I'm in a bit of a bind and could use some advice. I'm having trouble getting a personal loan and don't know what to do to improve/fix the reasons why.

ABOUT ME: I am a 25 yrs old and just moved from the East to the West Coast to start an MD-PhD program. My graduate program will be 8 yrs during which my tuition, fees, and health insurance is paid for by the university AND I get recieve $31,500 stipend annually. I spent 3 yrs out of college working after college and managed my credit well so my TransUnion and Experian Credit Scores are 736 and 747. I have one debt consolidation/moving expenses loan (~$7000 on a 48-mo term loan).

PROBLEM: Because of my tuition, fees, insurance, and stipend being covered I am not eligible for any financial aid as it meets the estimated cost of attendance. I am attempting to take out a personal loan (~$5000 on a 36 or 48mo term) to cover furniture, a new computer, the cost of my medical student supplies, etc. My applications have been denied, even through my credit union back east.

The reasons are Avg Age of Credit and # of Inquiries, even though my credit scores are Good, almost Excellent, my debt to income ratio is 9%, my credit limit is $9750 between 3 cards and my credit utilization is at 15%.

Because I am an out of state student my work history and rental history on the West Coast is only 1 mo, which is a negative mark even though I have work and rental history from the East Coast. I opened up a new credit card out here (the 3rd of 3) because the other two with 0% balances had higher interest rates and fewer reward options, so that decreased the Avg. Age and put an inquiry on my credit report. Then Verizon FiOS and my new Landlord also ran credit checks so that's 3 in the span of a month.

QUESTION: Do I have any other options besides waiting? I can't do anything about the age of my credit and in addition to those 3 hard inquiries I now have inquiries from USAA and NIH FCU on my credit report. With my credit score at ~740 I didn't think I would be denied a loan but now I've been denied two. I can go ahead and make these purchases on my credit card but then my credit utilization goes up to 50% and the interest rate is 15%. I'd prefer not spend $5000 in that way.

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You will have to wait for those inquiries to lose their damage and wait for your current accounts to age. You will also have to wait for your employment history and residence history to grow as well. There may be a lender out there that will give you a loan now, but your chance will improve as time goes on. Do your research on lenders and try to determine which lenders you will have the best chance with when the time comes. I have no idea what student supplies cost, but as far as furniture and a computer, you could pick them up used at a yard sale or local classifieds or go to a Walmart or equivalent and buy new there. I would not be worried about getting the best of everything at this point, especially if you cannot afford it and have to put it on a credit card. You could get the following items new at a big box store or maybe even off amazon: Futon $200, Chair $200, Folding table w/chairs $60, computer $300 or as I said, go to a local yard sale or check the local classifieds, a can of lysol and a vacuum cleaner and your good to go.

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