According to The Knot 2016 Real Weddings Study, last year an average cost of a wedding in the US hit a whopping $35,329. With the cost of the average wedding hitting an all-time high, it means that many couples don’t have that money to afford their dream wedding.
Thus, they choose to pay for the ceremony with the help of personal wedding loans. If you are planning your “Big Day” and considering taking out a wedding loan, here is what you might need to know about the way it works.
What Are “Loans for Wedding”
To be exact: there is no such term as “wedding day loans.” Banks don’t give money for wedding upon request. Those are personal loans that are aimed at funding your wedding. If you are planning this event, you have three options to choose from.
You may either save the money yourself, tap your parents, or turn to loans for a wedding. This kind of loan is similar to a personal loan and it may vary from $3,000 to $35,000.
Different Ways to Pay for Wedding
- Taking Wedding Personal Loans
The majority of the companies on the Internet offer small loans. Online services and lenders can approve your loan application the same way as the banks would do. Make sure to do some research and have a look at various companies that offer wedding ring loans or small personal loans. Gathering as much information as possible about different services will help you pick the best option. Don’t worry if your credit score is not perfect. Some services provide wedding loans for people with bad credit as well.
- Using a Home Equity Line of Credit
This way of covering the wedding costs is suitable only for homeowners. Sometimes parents are eager to help their children pay for the wedding and offer to use a home equity line of credit. It means they will borrow money against the mortgage on their home. This might be not the best idea unless you can’t qualify for wedding loans with bad credit.
Of course, it’s rather difficult to get an approval and take bad credit wedding loans. Thus, parents lend a helping hand to children and borrow the required amount for the wedding against the value of their home.
- Using Credit Cards
In case the first two options don’t seem to be perfect, you may select credit card as a way to pay the wedding costs. However, using credit cards can be beneficial when you already have the cash for the wedding. It can protect your money from fraud and even get your extra points for hotels and flights (for the future honeymoon).
- Save Up for the Wedding
The last financial option for covering the costs of your upcoming wedding is to extend the engagement and save money for the ceremony. There is nothing bad in a long engagement. Besides, creating a wedding budget can be a perfect solution for people who want to get wedding loans for bad credit but can’t qualify.
How to Apply for a Wedding Loan
- Bad Credit Wedding Loans
The first and foremost rule for getting approved is maintaining a good credit score. Wedding loans for bad credit history are common these days but don’t rely on such tempting offers too much. Your credit score is the biggest factor that will influence on the approval process and the amount of cash you will receive. In case, you don’t have time to improve your credit, some services provide with wedding loans for poor credit.
- Financial aspect
Also, pay attention to your financial documents and make sure they are all in order. Personal loan lenders or the bank will ask for your bank statements, proof of income, and other debt you might have (mortgages, student loans, etc.). In other words, wedding loans need the same documentation package as any other type of loans.