While the national average cost of a wedding is $33,931, it’s important to remember that it’s possible to have an amazing wedding on any budget. The keys are saving, setting priorities and sticking to the number you start with-but we’re not saying it’s always easy to do. Ideally, you should avoid using credit to pay for your wedding, but there are cases when taking out a wedding loan may make sense for your circumstances.
Also, if you are willing to accept the risks of taking out a loan for a wedding in exchange for getting the wedding day you want, that’s your choice. Before you make that choice, however, it’s important that you learn more about wedding loans, how they work and the major pros and cons of starting your married life in debt.
What are Wedding Loans?
First things first: There’s no such thing as a “wedding loan.” You can’t just walk into a bank and request a wedding loan. What we’re talking about here is using a personal loan for the purpose of funding your wedding. Most financial advisers would tell you to stop here and not pursue wedding loans. “Taking out a personal loan is kind of a last-ditch effort,” says Lauren Lyons Cole, certified financial planner and personal finance contributor for financial-planning website Mainstreet. “The problem with personal loans is that most often people are taking them out because they’re trying to spend cash they don’t have. I would also lump in credit card spending here, because I think a lot of people pay for wedding-related things with a credit card and they may or may not have the cash to pay it off in full.” Personal loans are good to avoid spiraling into credit card debt, but maybe not as a quick fix for a down payment on your venue. That being said, taking out wedding loans isn’t unheard of, and there are a few ways to go about getting a personal loan to help cover wedding costs.
The Pros and Cons of Marriage Loans
Can you take out a loan for your wedding? As long as you can qualify for the loan, the answer is yes. The real question is: should you take out a personal loan for your wedding? Here are the main pros and cons to consider:
- They’re a convenient way to get money. As you start planning your wedding, you’ll discover that your venue and your vendors expect upfront deposits in order to book their space and services. These costs can add up quickly, especially when you add your wedding dress and accessories into the mix. If you don’t have a huge chunk of money sitting around in your savings account, a marriage loan can give you the cash you need to cover your deposits.
- They’re easy to get. In many cases, you can apply for your wedding loan online in a matter of minutes once you get your financial documents in order. Your bank or loan provider will review your application, and, if you’re approved, will deposit your loan amount directly into your account payday loans in Rhode Island.
- You’ll get your money quickly. Most lenders can review your application, approve it, and deposit your loan amount in a matter of days. Some lenders even promise loan funding in 24 hours.
- Better interest rates than credit cards. If you have a good credit score and a strong credit history, chances are that you can get a marriage loan with an interest rate lower than your credit cards.
- Some loans don’t charge for prepayments. Some loans will allow you to pay off your loan early without any penalty fees, which can save you on interest costs. If you plan on paying off your loan with cash gifts from wedding guests, or if parents or other family members have offered to help fund your Big Day, you may not have to pay any interest at all. Double check the language of your loan to make sure prepayments are allowed.