Your wedding day is possibly one of the most important and special days of your life and we think that you should have everything you want. If you feel as though you’re coming up short when it comes to the financial side of your wedding then you need to look into applying for a wedding loan. This type of loan can help you cover the cost of any part of your wedding, from the venue to your honeymoon whatever you need help with.
Can You Get A Loan For A Wedding?
A wedding loan is a small short-term personal loan that you use to pay for your dream wedding. Personal loans come in a wide range of forms for a wide range of borrowers, meaning that you should be able to find something perfect for your current financial needs. Better still, personal loans can be either secured or unsecured using collateral. This means that you can use one of your assets as collateral to secure a loan, typically secured loans and unsecured loans have slightly different terms and requirements so you can choose whichever option best suits your needs.
Types Of Wedding Loans
Since weddings can be extremely pricey, you might need to borrow money to help cover your expenses. In that event, there are a few different options you can choose, such as:
- Personal Loan – This loan lets you borrow a lump sum of cash, then repay it in installments over a set term, plus interest and fees. Funds are usually deposited directly into your bank account and rates vary based on your finances and credit.
- Line of Credit – Like a credit card, this product lets you borrow from a revolving credit line in any amount you need. Interest only applies to your unpaid balances and you can make minimum or partial payments each month to avoid penalties.
- Home Equity Loan – If you have enough equity in your home, you may be able to take out a secured loan against it. While the lender can seize the equity if you default, the rates and conditions can be better because you’re offering collateral.
Best Lenders To Get A Loan To Finance Your Wedding
Filters
Can You Get A Wedding Loan With Your Spouse?
If you can’t afford or can’t qualify for a wedding loan by yourself, you can also consider applying for a joint personal loan with your soon-to-be spouse. This way, you’ll both act as co-borrowers and will be equally responsible for any debt, thereby reducing risk for the lender and increasing your chances of approval for a loan with good conditions.
Keep in mind that if you or your spouse has bad credit, you might get denied or only qualify for a smaller loan with a higher rate and stricter term. In that case, the spouse with better credit may have more luck applying alone.
How To Get Approved For A Wedding Loan?
When you apply for a loan in Canada, the approval process varies from lender to lender. That said, here are some basic steps you can take to get approved for a wedding loan:
Step 1. Decide How Much You Can Afford To Borrow
Start by tallying up the approximate cost of your wedding, then weigh that amount against the potential cost of the loan you need and your income. Don’t forget to factor in any interest or fees the lender might charge, since they can significantly increase the final price of a wedding loan.
Step 2. Check Your Credit
Next, get your credit report and credit score from Canada’s credit bureaus. Make sure there are no errors or signs of fraud on your report, and that your score is in the 660 – 900 (good to excellent) range. If your score is in the bad range of roughly 300 to 600, it can be harder to get an affordable wedding loan.
So, it’s best to check your credit score and spend time raising your score by removing errors from your credit report, building your credit history, and paying off your existing debts before you apply.
Step 3. Compare Wedding Loan Offers
When your credit and finances are strong, shop around with multiple lenders to compare loans. Some lenders have free pre-qualification tools to show you what kinds of loans, rates and terms you’re eligible for. While those offers aren’t always 100% accurate, prequalifying won’t affect your credit score.
Step 4. Submit Your Application
Once you find an affordable wedding loan, you can complete an application online. Applying is often easy, but it may take several hours or days depending on the lender and the size of your loan. Just make sure you choose a legitimate lender and fill in your application honestly.
Borrow Up To $50,000
Benefits Of Getting A Wedding Loan
Here are some of the most positive aspects of getting a wedding loan in Canada:
- Any Use – Since your loan will appear as liquid cash in your bank account, you can spend it on any wedding-related cost, like the venue, food or entertainment.
- Lower Interest Rates – If you apply with a good income and credit score, you may be able to qualify for lower interest rates than most credit cards give you.
- Flexible Terms And Payments – Some wedding loans have repayment terms of about 1 to 7 years and penalty-free prepayments to help you save on interest.
Risks Of Getting A Wedding Loan
If you’re planning on financing your wedding expenses, there are a few things you should consider before applying for a wedding loan.
- A Wedding Loan Is Still A Loan. If you’re currently engaged and know that you’ll need a loan to help pay for your wedding you might want to consider working on your credit score to help improve your chances of being approved. There’s nothing worse than planning the wedding of your dreams and then being rejected for the loan that was going to cover a significant portion of the cost.
- Significant Debt – A wedding is already expensive enough without adding the cost of a loan to it, which can put you and your spouse in debt for many years.
- Potentially High Rates – If you apply with bad credit or a low income, you could only qualify for small loans with far higher interest rates (if you’re eligible at all).
- Possible Credit Damage – Every wedding loan payment you miss could lower your credit score and make you less creditworthy when you apply for loans later in life.
Alternative Ways To Pay For Your Wedding
- Crowdfund using your friends and family: Though it may be hard for some, asking to borrow money from your close friends and family is one way of getting the money you need without having to take on a loan. Moreover, you can save on interest when you pay them back, as it is unlikely they will ask for interest.
- Save up: In most cases, you have a year or two before your actual wedding day. This will give you enough time to save money to pay for all or at least part of the wedding. That way, you won’t have to take out a loan for the entire cost of the wedding.
- Think outside the box: It may be hard to imagine, but there are ways you can save money without having to give up on quality. For example, rather than hiring a makeup artist, you can ask a friend or family member who is great at hair and makeup.
- Cut Costs: You can lower the amount of money you’ll need to borrow by cutting your wedding costs in inconsequential areas. For example, rather than having an open bar with high-end alcohol, you can opt for a limited-time bar that offers more regular alcohol. Your guests won’t know the difference and in general, won’t remember the specifics but the overall feeling of the day
Additional Reading
Wedding Loan FAQs
Will a wedding loan affect my credit score?
Can you get a wedding loan with bad credit?
What if I get rejected for a wedding loan from a bank?
Should I use my credit card to finance my wedding?
Bottom Line
The cost of a wedding can be very high, as such, it is recommended that you do some research and find a lender that’s right for you before you make any final decisions. Be sure to also make have a budget planned out and know how much you need to borrow. That way when you get in contact with your lender you’ll also be able to provide them with all the information they need.
