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Are Wedding Loans a Good Way to Cover Costs?

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rachel torgerson the knot bridal fashion expert
by Rachel Torgerson
rachel torgerson the knot bridal fashion expert
Rachel Torgerson
Bridal Fashion Expert
  • Rachel Torgerson is a New York-based journalist and social media professional.
  • Rachel is a Senior Fashion Editor for Cosmopolitan.
  • Rachel worked for The Knot as an Assistant Editor and Editorial Assistant.
Updated Sep 10, 2020
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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.com. "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:

Pros of Wedding Loans

  • 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.
  • 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.
  • You'll improve your credit score. Couples looking to build or improve their credit can boost their score by successfully paying their marriage loan. Make sure not to miss payments or make late payments. A higher credit score will make it easier to get loans in the future and keep your interest rates low.

Cons of Wedding Loans

  • Interest, interest, interest! By taking out a loan for your wedding, you will be paying interest on the loan for years. For example, if you take out a 5-year loan for $15,000 at a 10 percent interest rate, you'll end up paying over $4,000 in interest over the course of the loan. Is splurging for your weddingSpecial Day really worth an extra $4,000?
  • You'll be starting out your marriage in debt. Money troubles are a common cause of relationship stress. Do you want to start off this new and exciting chapter of your life with a monthly loan payment for the next three to five years?
  • Existing loans make it more difficult to qualify for new loans. Are you thinking of buying a new car or even a new home after your wedding? When a bank considers giving you a loan, they will look at your existing loans to determine if you can afford the new loan. If you have a lot of existing loans, the bank may not give you a loan for the amount you want, or they may deny your loan altogether.
  • They could make you spend more. Getting the money for your wedding loan in your bank account could make you feel flush with cash. You may feel more comfortable upgrading your floral arrangements, choosing that dress that's out of budget or inviting a few more people to your wedding. All of these upgrades add up.

The decision to take out a loan for your wedding is one you must make with your partner, because it'll affect financial decisions on your marriage later. It's important to talk about whether or not that financial burden is something you want to deal with when you get back from the honeymoon. Below is a list of the ways to cover the costs of a wedding with loans. (Again, this is just to inform you on how it's done—we don't recommend it!

What are Other Ways to Cover Wedding Costs

Using an Online Personal Loan Company to Pay for the Wedding

A ton of Internet loan companies have sprung up over the past few years, and most offer crowd-sourced loans. Here's how it works: Online investors front money for you once you've been approved by the company in much the same way you'd be approved by a bank. Then you pay them back, including interest, in the same way you would a bank. A good site (read: trusted) for online wedding loans is Upstart. Sites like Upstart will have you safely fill in your information, then bring up the types of loans (and the personal loan rates) that you qualify for. "Unless you can pay off the monthly balance immediately, credit cards are not a great option for long term debt," says Jungwon Byun, head of growth at Upstart. "The Upstart platform is smart; we use education and employment in addition to credit history to determine the APR. The entire process is also online and very simple, making it a fast and easy way to borrow." If you're interested, you can move forward with the application process for your wedding loan. If not, just stop there

Taking Out a Home Equity Line of Credit to Pay for the Wedding

This one is only for homeowners and usually for parents paying for their children's nuptials. The idea behind a home equity line of credit is that you borrow against the mortgage on your home. Again, though, it's not a good idea. Neither the financial experts nor we would recommend doing such a thing. "I've seen parents take out a home equity line of credit, which is basically borrowing against the value of your home," says Lyons Cole. "Especially for a lot of parents, if you're throwing a wedding, you're probably mid-40s to 50s, you're not that far away from retirement, you probably just put your kid through college—there are so many expenses and pressures put on a parent, and chances are you need that money for something else.

Using a Credit Card to Pay for the Wedding

We should warn you that most financial advisers are wary of credit cards and lines of credit when it comes to alternative ways to pay for your wedding. For Lyons Cole, this is one of the fastest ways to get into deep debt. "Obviously, as a financial planner, my advice would always be to create a budget and only pay for things you can afford," says Lyons Cole. "Don't go into credit card debt for a wedding."

That said, if (and only if) you have the cash to pay for your wedding, a credit card can be a good option. Here's why: Using credit can protect your money from fraud and earn you points for flights and even hotels (hello, honeymoon!). Just try not to pay for wedding things with money you don't have yet, and you'll be fine

Extending Your Engagement and Saving Up for the Wedding

Ding, ding! This is the way to go. Avoid wedding loans and take some time to create a wedding budget and truly save up for the things you want. There's no harm in a long engagement. Many times, venues are already booked more than a year in advance anyway. Having one will allow you to have enough time to truly plan the wedding and save up for the items that are nonnegotiable, and even splurge on a few things you've always hoped to have. "I would rather have you postpone your engagement six months to a year to save money," says Lyons Cole. "Paying forward by saving is much better than paying backwards with debt.

How Much Money can you get with a Wedding Loan

Personal loans can range from anywhere between $1,000 and $50,000. The same goes for online companies like Upstart. "Upstart offers three and five year loans, with no prepayment penalty. You can decide what amount and term length you and your partner are most comfortable with," says Byun

How do you get a Wedding Loan?

At the risk of sounding like a broken record, getting a wedding loan may not be the best idea out there. But if you're still reading and you've made up your mind, here's everything you'll need to get a personal loan to cover wedding costs

Make Sure You Have Good Credit

If you're looking to get a wedding loan, you'll have to ensure your financials are in order. The biggest factor, traditionally, is your credit score. Anything above 700 is usually considered a good credit score. However, you can still get a loan with a lower score. At lending website Upstart.com, you'll still need a score of 620 or higher to qualify for a loan, says Byun. To figure out your credit score, there are a number of free credit score sites. (We trust CreditKarma.com to easily figure out your credit score.)

Have Your Financial Documents in Order

Beyond the credit score, your institution will want to take a look at your proof of income, bank statements and any other debt you might have (student loans, mortgages, etc.). You'll have to check with your institution to find out what specific documents and qualifications you'll need. In other words, online wedding loans require many of the same types of documentation as any other loan. "At Upstart, we've worked hard to automate much of our process. This makes applying for a loan incredibly simple and fast. Our customer service team is also available to help every step of the way," says Byun.
But again, don't feel like you have to turn to a wedding loan to pay for your big day. There are lots of ways to save and cut wedding costs. We know budgeting for the wedding can be arduous, and there are just some things out there that are too cool not to have, but we simply have to impress upon you that starting your future in debt is not a good way to kick off your marriage. Need a basic rundown of a simple wedding budget? Looking for expensive wedding dates to avoid? Or need simple planning advice to get a handle on the whole process? We've got you completely covered, below.

Helpful Budgeting Links

> 30 Ways to Save Money on Your Wedding

> Just Engaged and Completely Overwhelmed? Read This Now!

> Wedding Ideas That Won't Blow Your Budget

> Wedding Insurance 101

> Wedding Budget Basics

> Expensive Wedding Dates to Avoid in 2015 and 2016

> Watch Our for These Hidden Wedding Costs


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