Having the most important step in your life, the wedding day, is both exciting and costly.
It will for sure be the most expensive day of your life, and the preparations go way back for months in advance. So, as both of you think of the big moment when you will be surrounded by family, friends or colleagues, there are so many things to consider in order to have the perfect wedding and the greatest party.
Today, many weddings can cost as much as tens of thousands of dollars. In fact, the average cost of a wedding in the United States is more than $30,000, and there are almost 2.5 million such events each year. Comparing to that cost, the average yearly salary of just over $55,000 make the wedding a very expensive event.
Needless to say that having to pay for them from the pocket or go to the savings is not always a viable alternative. Some rely on paying the expenses just after the wedding from the gift money, but that can’t always be anticipated.
These being said, while big dreams like this don’t have to be put aside, sometimes other financing options can be taken into account. One example is a personal loan.
The benefits of a wedding loan
There are plenty of benefits of taking a wedding loan. Apart of making the dream come true by accessing the necessary funds, this type of loan is safe. Because it doesn’t require collaterals, you won’t have to worry about losing a home, a car, or any other asset. Also, the money will pe repaid on the course of several years, so this is just a normal personal loan, with no need to rush the payment or put in this process all the money later earned or received. Last but not least, the money will be received quickly.
The first step is to assay how much money can you afford to take at that special moment of your life. If you don’t have a big debt already, there are many loans with affordable terms, which you can pay up without any problems.
If you give yourselves the green light on having the loan for the wedding, the first option is certainly the personal loan. In most cases, a loan like the one for the wedding will be regarded as a personal loan for the banks or for the other lenders.
It is understandable that many tend to opt for personal loans from banks at which they already are customers. This has its benefits in terms of time and financial obligations.
Good credit score vs bad credit score
To qualify for the wedding loans, you have to take into account some options which will boost the chances for a low rate. First, check for any errors in your credit reports. Inaccurate data may drag your credit down. Also, adding a co-signer with a good credit, like a parent or anyone else in the family, will increase the chances for approval of a more favorable rate.
A great credit will set you back to an average interest rate of around 10%, and some even push it below this threshold. In generally, the best terms and rates are when you have the best credit possible. The math is simple: The higher the credit score, the better the benefits.
But what if you have a bad credit score? You can still get a bad credit wedding loan, even though the conditions are not the same and is not all that easy as with a decent credit. There are though some drawbacks in this situation. For example, the annual percentage rates (APRs) can go up to 35% or even more. You can read more about it if you click here and read this blog post.
Bad credit doesn’t mean the dream is over
You can still be eligible to apply for a wedding loan, even though you have a bad credit. One thing that helps a lot is a permanent job with a regular income. That will give the bank some assurance that the debt will be paid off, even though the credit score is not that good. The main reason is that, being an unsecured personal loan, this type of loan doesn’t require a collateral to secure it. Thus, the credit score and the income are the only considerations when the bank analyzes the wedding loan application.
Either good credit or bad credit – or, luckily, no need for credit at all -, you will still need to be mindful when planning how much to spend an on what. While a nice perfect wedding is still on the mind, don’t over-budget. Keep all the dear ones and the necessary expenditures, but not exaggerate on what you don’t need.
Another way to have a well balanced wedding, when it comes to the finance, is to always know what figure to expect on planning the spending. And if you really badly want to have a personal loan to finance the wedding, consider to pay all the previous debts on time and even reduce the debt amount, so that when you will apply for a weeding loan, the credit score will be as good as possible.
Marry each other, not the money, to live happily ever after
In the end, is better to bear in mind that you shouldn’t take more money than you need for the wedding. The enthusiasm of the beginning may be overwhelming, but this the moment you start this part of your life, you should take care not only of your today finances today, and also your tomorrow finances. It is a fact that wedding loans can have the couples spend more on the event that if they have all the money without the need of borrowing.
Also, do consider alternative sources of financing for the big event. Loans from family or friends is always on the table, and so is the secured personal loans. In the end, as unexpected as it may be, the wedding gifts will cover for at least a good part of the loan, either from a financial institution, or from someone you know.