One of the most important events that will take place in a couple’s life is the wedding. For sure, every man or woman out there dreams of a happy wedding. Whether it’s a small-scale, intimate wedding or a big marriage celebration, there’s always the thought of how to finance it.
In the United States, the average cost of a wedding is approximately $34,000. This includes expenses such as the wedding ring, dress, ceremony, and reception. With this expensive cost, it’s only apt to ask the questions: can you get a loan for a wedding? If yes, is it a wise decision to take out a loan to finance such an important event?
If you want to know the answers to these queries, you better read this blog article with regards to getting a personal loan to finance a wedding.
When Does Getting a Loan for a Wedding Make Sense?
Taking out a personal installment loan to finance a wedding can save you money because it typically has more affordable interest rates than credit cards. Also, if you have a good to excellent credit score, you can avail of a lower rate of interest and more advantageous repayment terms.
You only need to make sure that you can afford to pay back the loan consistently once a month. When you don’t miss payments, you’ll have the benefit of repaying the loan in full at its maturity date and improving your credit score. And, of course, when you have built your credit, it will be easier for you to get a loan with a favorable interest rate in the future.
Getting a personal installment loan is also a wise choice if you need cash to pay for the reserved venue of your wedding ceremony or reception, as well as other expenses that need to be paid before the wedding date. Loan providers will provide you the money you need fast via direct deposit or check.
When Not to Get a Personal Loan for a Wedding?
There are circumstances that getting a personal loan to pay for wedding expenses can be a bad choice. For instance, if you don’t plan your wedding budget and you have the tendency to overspend, there are chances that you may opt for a higher loan amount than what you can afford to repay.
It’s not unusual for a lot of couples to get overwhelmed with emotions as their big day approaches. As such, they tend to spend more than they can afford. So, it’s a must to take into account all your target expenses before your wedding date. Then, take out a loan amount based on the projected total cost of the upcoming celebration.
Make sure that you can pay back what you owe on time to avoid the penalty charges caused by late payments. Of course, you don’t want to begin your married life having too much debt to repay. It will be even more problematic if you have other debts, such as credit card balances and student loans to eliminate.
Other than the interest charges, there are loans that will put a burden on your finances due to their origination fees, e-payment processing charges, prepayment penalties, etc.
Steps to Taking Out a Personal Loan to Finance a Wedding
The process of getting a personal loan for your wedding is not that difficult. Here are the steps you need to follow for that purpose.
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Know your credit. It’s a must to look at your credit reports and know your credit score before you apply for a loan. As mentioned earlier, it’s not a smart move to get a personal loan if you have a poor credit score. If your credit is not that good, make sure to improve it before sending your loan application.
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Find lenders. Credit unions, banks, and online lenders offer wedding loans with favorable interest rates. Just ensure that you prepare the necessary requirements for your application.
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Get prequalified. Loan prequalification only requires a soft inquiry on your credit, which means that it won’t lower your credit score. This process allows you to know the loan offerings you’re qualified to get.
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Consider the different loan offerings you qualify for. If you’re done with the prequalification and you already know loan offerings you can apply for, make sure to compare them thoroughly. Read the loan terms, interest rates, and fees so you can pick the best one that suits your financial situation.
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Send your application. After you’ve picked the right loan for you, it’s now time to fill out the form and submit your loan application. Most lenders today will process your loan application fast and provide your much-needed cash just within a few days.
Takeaway
Getting a personal loan to pay for your wedding expenses can be a good or bad choice, depending on the circumstances. You have to ensure that you have good credit to avail of favorable loan terms and interest rates. It’s also crucial to plan your wedding budget to know the estimated loan amount that you should borrow.
