Wedding loans are the way to go if you want to have your wedding day as soon as possible, but you don’t have that amount of money right now. Weddings are expensive, we know! There’s nothing better than having the luxury of paying that money in smaller instalments rather than all at once.
However, before deciding on getting a wedding loan, you must know what you’re getting yourself into! Loans are a long-term commitment, and you don’t want to sign the first contract you see. So, keep on reading to learn more!
What Are Wedding Loans?
Wedding loans include any money borrowed from a bank, financial provider, or any lender to pay for your wedding expenses. Instant cash loans on a weekend can cover the money you need to pay for the wedding venue, the photographer, the dress, the decorations, and even the honeymoon.
Weddings can be quite expensive as the average price for weddings in Australia is $36,000. Not to mention, most people end up spending a lot more than the budget they set for the wedding, which might leave you in a tight situation where you need to apply for a loan.
Additionally, you might not want to pay the whole amount up front; paying smaller amounts over a more extended period can be a lot more applicable for some people.
You can apply for a truck loan to cover the cost of the whole wedding day, or just bits and pieces, like just the dress or the venue, to help you get the wedding day of your dreams.
Wedding Loan Types
There are different types of wedding loans in Australia, so make sure you’re familiar with all loan types before making a final decision.
Secured Wedding Loans
First of all, secured wedding loans, or personal motorbike loans in general, require some sort of financial asset. That asset can be real estate, jewellery, or cars – it just has to be valued at more than or equal to the amount of money you’re borrowing.
While that approach might seem risky, going for a secured loan might be the way to go if you’re looking for wedding loans with no credit check because other loan types typically require good credit.
Additionally, a secured engagement ring loan Australia is generally easier to get and more convenient for most people because they have lower interest rates and fewer restrictions on the amount of money you can borrow. However, keep in mind that the lender has the right to sell your valuable asset if you don’t pay back the money.
Unsecured Wedding Loans
Unsecured wedding loans require no assets in return for the money, which is why most people prefer them.
However, unsecured loans tend to have higher interest rates and more restrictive eligibility criteria. Some lenders might decline your application if you don’t have a perfect credit score, for example. They also have lower borrowing limits, which might be an issue if you plan to get a large loan.
Short-Term Wedding Loans
Generally, you won’t find yourself reaching out for short term loans unless it’s an emergency, simply because they have high-interest rates and very short terms.
What’s more, short term loans tend to have very restrictive borrowing limits, making this type of loans perfect for paying for smaller bits, like the dress, rather than the whole wedding.
Wedding Loan Fees and Rates
Choosing the lender for your medical loans depends on how much you’ll have to pay in fees and interest rates. Here’s everything you need to know about the additional costs of a wedding loan.
Interest and Comparison Rates
The interest and comparison rates are the most critical numbers you need to know when considering applying for a loan to pay for your wedding day.
If you don’t know the difference between the two, it’s simply that comparison rates include interest rates as well as any monthly or annual fees you might have to pay along the way. So, we strongly recommend looking at the provider’s comparison rate other than the interest rate whenever you can.
When applying for a wedding loan, the comparison rate can vary according to many factors, including the type of solar loan, your credit score, and the lender’s terms and conditions. To give you a better perspective, most comparison rates for secured loans start at 7%, while unsecured loans’ rates usually start at 9%.
Sadly, the loan rate isn’t everything you’ll have to pay. Some lenders ask for application fees just to review the application, and that’s usually around $100-$200. Additionally, some financial providers charge for establishment fees after the loan has been accepted, and that’s usually about $200.
What’s more, you might have to pay monthly or annual fees, which are usually included in the comparison rate. Still, you should read the lender’s terms and conditions carefully, and see if there are any other fees you have to pay.
Wedding Loan Limitations
As you probably guess, you can’t just apply for a $200,000 loan for a wedding and expect the lender just to agree! There are limitations on the amount of money you can borrow and how frequent your payments will be.
Borrowing limits can change according to the type of loan you’re applying for. As mentioned before, a secured loan for breast implants tend to have higher limits that can go up to $60,000. On the other hand, unsecured motorbike loans can go up to around $40,000, which is still more than the price of the average wedding in Australia.
Also, your loan has to be over a certain amount (usually $3000 to $5000) to be regarded as a wedding loan and not a short-term or a payday loan.
Most wedding loans have terms ranging from 2 years and up to 5 years, which should be long enough to distribute the money over smaller instalments.
The frequency of pool loan instalments is a critical factor that you need to be aware of. Most providers give you the freedom to pick the repayment frequency that best fits your needs. You can choose to pay weekly, fortnightly, or monthly.
Common Eligibility Criteria
The eligibility criteria for taking out a wedding loan change drastically from a lender to another. However, there are some common rules that all financial providers agree on, and they include:
- You have to be 18 years or older.
- You must be an Australian citizen or have permanent residency in the country.
- You must have a reliable income.
Additionally, some providers require having a good credit score or that you haven’t filed for bankruptcy before.
Now that you know what to expect when applying for a phone loan, you’re on the right track to having your perfect wedding day! The best thing about wedding loans is that you don’t have to pay a large amount of money upfront and you can just pay over a longer duration and in smaller instalments.
Just be careful when reading the lender’s terms and conditions, and have a finance expert look at them if you can.