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    Can You Get A Wedding Loan With Bad Credit?

    Lyn Ridley
    Lyn Ridley - 2019-12-17T22:00:00.000Z

    Getting married is a special time in anyone’s life and money isn’t always top of mind for soon to be brides and grooms.

    However, with the cost of weddings currently being over $30,000 on average it’s simply not something that will take care of itself.

    A wedding loan can provide the funds you need to pay for that unforgettable day with comfortable payment terms.

    Here’s how you can apply for one.

    What Is A Wedding Loan?

    Wedding loans are a type of personal loan that you can use to pay for your wedding.

    Given the sheer cost, many couples increasingly choose to pay for their weddings using a credit card or a wedding loan.

    • Credit cards generally have lower limits than personal loans and the APR you may end up paying can add thousands of dollars to your wedding loan repayment.
    • If your credit score is good (700 or higher) you will probably find greater value in a wedding loan.

    In this article, we’ll focus on personal loans that you can use for wedding expenses. Let’s start with the basics.

    Is a Wedding Loan A Secured Or Unsecured Personal Loan?

    There are two main types of personal loans: secured and unsecured.

    Most wedding loans are unsecured loans, meaning that you don’t need to provide collateral for the loan. Here’s how it works.

    • An unsecured wedding loan doesn’t require collateral. You qualify for this loan based solely on your income and credit score.
    • You’ll probably receive a more competitive APR on the loan than you would on a credit card and your total loan amount is likely to be larger too. 
    • The lower APR and higher loan amount will allow you to pay for the wedding you always wanted in manageable monthly payments.

    What Are The Benefits Of Taking A Wedding Loan?

    A wedding loan will provide you with the funds you need to pay for one of the most memorable days of your life but it has financial benefits too.

    Here are some of the main ones.

    • Access to funds - You’ll be able to pay for your wedding expenses and repay your loan affordably.
    • Flexible repayment terms - You’ll have several years to repay your wedding loan with the option to refinance on some loans.
    • No collateral required - You won’t run the risk of losing your home or vehicle if you don’t make your loan repayments.

    What Are The Drawbacks Of Taking A Wedding Loan?

    While wedding loans can make your dream day a reality, they also have several drawbacks.

    These include:

    • High APRs - APRs on bad credit wedding loans may be as high as 35% per year
    • Fees and Penalties - Origination fees of up to 5% and prepayment fees may also apply for some wedding loans.
    • Affordability - The cost of debt repayments may not be affordable for young couples.

    Are Bad Credit Borrowers Eligible to Apply?

    Wedding loans are unsecured personal loans and therefore usually require a high credit score.

    • Since there is no collateral to secure the loan you will need to have a good credit score to apply.
    • This would typically be a FICO score of 700 or higher.
    • You’ll also need to have a permanent job with regular income to apply for a wedding loan.

    If your credit score and financial situation is less than stellar, you may want to explore other options to finance your wedding.

    A bad credit personal loan, secured personal loan, or an informal loan from a relative may be better alternatives for borrowers with FICO scores lower than 700.

    Tips For Financing A Wedding Celebration

    Paying for your wedding doesn’t need to be stressful.

    Here are some ways you can budget for a great celebration and finance it effectively.

    • Don’t over-budget - It’s far better to have a smaller wedding reception and invite the people you really care for to celebrate with you. That way you can treat the important people in your life to an unforgettable experience on your wedding day instead of burdening yourself with debt the day after.
    • Have a figure in mind - Once you’ve planned your wedding, work on a round figure - like $10,000 - and make a few enquiries. If you can get pre-approved for this amount by a loan company, you’re almost there.
    •  Raise your credit score - If your wedding is still a year or more in the future you still have time to boost your credit score. Pay your debts on time, reduce your total debt amount, and request your free annual credit report from the three main credit bureaus.

    Conclusion

    A wedding loan can provide you with the funds you need to make your big day unforgettable on easy payment terms as long as your credit is good.

    If your credit score is below 700 you may want to consider alternative sources of cash to pay for your wedding.

    These include secured personal loans, credit cards or a loan from a family member.

    You’ll also want to budget for your wedding according to the number of guests you want to invite and the amount of money you think you’ll be able to secure for your wedding budget.

    The last thing you want to do after a magical celebration is begin your new life together burdened with unnecessary debt, so plan accordingly.