“She said yes!”
…to tens of thousands of dollars of debt, a year and a half of stress, and the impending pressure of planning a “perfect” day.
Once you’re engaged, you may be enchanted by designer dresses, stunning floral displays, and gorgeous ballrooms…until you see the cost.
Over the past few years, weddings have become more expensive. In what is now being called “the wedding boom,” wedding-related costs have skyrocketed.
While costs have risen, your budget may not have.
Enter: the wedding loan.
Is borrowing money to finance your big day a smart move? Read on to find out!
1. The Wedding Loan: Defined
In the year 2022, the average wedding costs about $27,000. This cost is much higher for couples who live in high-cost-of-living areas like New York or Los Angeles.
If you’re dreaming of throwing the event of the year but aren’t sure how to pay for it, you may be considering a wedding loan.
A wedding loan is a sum of money that is borrowed from the bank and can be paid pack in installments over a period of time (usually 1 to 7 years).
The amount borrowed is up to you, but it could be just a few thousand dollars or more like $100,000.
Of course, like with any other loan, the money isn’t necessarily free. Couples will need to pay interest on whatever money they borrow.
Now, the interest rate itself is something to consider when debating a wedding loan vs. alternative methods for financing your big day.
2. Will You Qualify?
When shopping around for a wedding loan, it’s important to consider all of your options. Banks, credit unions, or online lenders are all places that may give you your loan.
Which one offers you the best deal is the question.
The number one thing to do to ensure that you qualify for a wedding loan is to improve your credit score.
Having a good credit score will make it more likely that you are approved for the loan at a lower interest rate.
If your credit score is on the lower end, you may need to do some work to raise it. This could include paying off your debts, lowering your credit card usage, and making payments on time.
Another option is to apply for a joint loan with your spouse. This way, both of your credit histories are taken into account.
3. The Pros of a Wedding Loan
There are many advantages to taking out a wedding loan. The most obvious one? It allows you the financial freedom to afford the wedding you’ve been dreaming of.
Who wouldn’t like a bit of extra cash to put towards an open bar or a photo booth?
Another “pro” is that getting a wedding loan may give you a better interest rate than using credit cards would. If you’re depending on credit cards to finance your wedding, you may find that you’re paying more in interest than if you had just taken out a loan.
Plus, taking out a loan can actually improve your credit score. If you take out a loan and pay it back on time, you’re building a strong credit history and can ultimately see a boosted score.
The final advantage to taking out a wedding loan? It’s a fairly speedy process. Taking out a wedding loan can take as few as 24 hours. So, if you want to start planning immediately, you’ll know you have the money to do so.
4. The Cons of a Wedding Loan
It’d be nice to pretend that a wedding loan was free money, but unfortunately, that isn’t the case. Taking out any type of loan is a serious decision and can come with consequences if not done thoughtfully.
The first con that comes with a wedding loan is the fact that you’ll be in debt. More specifically, you’ll start off your married life in debt. If you’re not prepared to pay that debt off on time, you could be setting yourself up for trouble.
If you plan on taking out any other loans, such as for a house, lenders may be hesitant if you have a wedding loan that you’re already repaying.
Finally, wedding loans can be misleading. While it may be exhilarating to have extra money to spend, it’s difficult to have restraint. You may end up taking out a larger loan than you needed or spending more than you should’ve.
With a wedding loan, it’s essential to keep the bigger picture in mind.
5. Who Should Take Out a Wedding Loan?
If you’re still not sure about whether you should take out a loan to finance your wedding, ask yourself if you meet the follow criteria:
You’re financially responsible. You have a high credit score and are sure you will be able to make your loan payments in the future.
You have time and you know you won’t need to take out other loans in the immediate future.
You don’t have better options to finance your wedding, such as getting help from your friends or family.
If this sounds like you, a loan may be your best choice!
Consider Your Options Before Choosing a Wedding Loan
In today’s day and age, what was once considered a modest wedding can cost about the same as a down payment on a house.
If you’re dead-set on having a special day but don’t exactly have that much cash sitting around, a wedding loan may be the smartest option to consider.
If you’ve shopped around, know the implications of a wedding loan, and feel secure that this is the best option for you, go on and plan the wedding that you deserve!
At the end of the day, marriage is more than a wedding. But, who are we kidding? The wedding is pretty fun too.
Click here to apply for a loan on our website! In just 3 minutes, you could have a loan of up to $15,000.
