Be Aware with These Pros & Cons of Wedding Loans

Last Updated : June 28, 2016, 10:27 a.m.

For many couples around the world, it would not be wrong to say that their wedding could be the most special moment. However, many are planning to get married, and are willing to have the best dream wedding ever. But, to be very honest this occasion is not just special and joyous, but it is also referred as an expensive occasion ever. Today, many couples work pretty hard so as to make their dream wedding perfect. This is the reason that they are taking the wedding loans offered by various lenders these days so as to cover all the wedding expenses. Yes, with the availability of many financial institutions who are offering the wedding loan, one can easily turn his/her dreams into reality by making the wedding extravagant. When it comes to wedding loan, it is no doubt one of the most convenient and easiest ways to get the required fund for the big day.

Pros of Wedding Loan:

• Wedding loan is no doubt very beneficial to those couples who are planning to get married. With the help of this loan, you can be rest assured as payments are fixed, and which will allow you to budget the money accordingly.

• You can have various options to choose as far as tenure is concerned. Yes, ranging from 1 month- 6 years, you can easily choose a tenure to repay the loan amount.

• It is also beneficial for you to know if you have the ability to pay the loan within the shorter period of time because then you would be able to pay the less Yes, interest will be lower for shorter tenure.

• No collateral or security is needed to avail the loan. Yes, to get this loan, you don't need the security or collateral as without doing this formality, you can easily avail the loan. It is good for those who are unable to fulfill this formality.

• If you have a good credit score, you can enjoy the lower rate of interest. Banks don't want to lose good customers, that's why they give competitive rate of interest to those who are having good repayment capacity along with the credit history.

Whereas, on the contrary, there are plenty of disadvantages associated with wedding loan.

Cons of Wedding Loan

• Such type of loans usually come with higher interest rates as they are unsecured loans, hence lender charge you with higher interest.
• These unsecured loans are backed only by trust, hence you are on the more risk from lender's point of view. Your profile is under a huge risk as lenders have to believe and trust on you.
• Usually, the loan amount that you get is not so high as compared to other loans just because of the fact that these loans are unsecured.
• When it comes to buying these unsecured loans, there lack of flexibility is there, being offered to the applicant.
• If you select a longer tenure to repay the loan, you need to pay more rate of interest. Yes, as the rate of interests are usually high for such loans, and if you avail them for longer tenure, automatically the interest rates will increase.

So, in a nutshell, if you are also the one who is planning to get married very soon, before going for a wedding loan, it would be of great importance to think about this decision many times. You must consider the pros and cons of wedding loan before reaching at any conclusion.

(Updated on:20th October,2016)