It’s an unfortunate truth: Getting married can be expensive. The average cost of a wedding in the U.S. is an astounding $33,000, according to The Knot’s 2017 Real Weddings Survey — and that’s before factoring in honeymoon expenses.
With costs that high, many couples turn to personal loans to finance their dream weddings. Our recent survey revealed 74% of couples planned to borrow money for their weddings, and about 21% planned to use personal loans for the event.
Though wedding loans are a convenient way to finance your nuptials, they come at a price.
See how these loans work, where to find them, and alternative ways to pay for your big day.
How wedding loans work
A wedding loan is an unsecured personal loan that you take out to pay for your ceremony or reception.
Some lenders refer to this type of debt as wedding loans, while others categorize it as loans used for special occasions. But most personal loan lenders will allow you to use a standard personal loan to pay for your event.
Your loan’s interest rate will be based on your credit history and income. Borrowers with excellent credit and a solid salary usually will qualify for the best rates. Even if you’re offered the lowest rates available, using a personal loan to pay for your wedding generally isn’t advisable.
Borrowing money to pay for your wedding is the most expensive way to get married. In addition to paying for the cost of goods and services, you’ll pay interest on the money borrowed.
A lavish wedding might feel necessary because of pressure from friends and family — but before going into debt to afford your dream day, consider cutting costs to bring your expenses in line with your budget.
Where to find wedding loans if you need them
If you must go into debt for your nuptials, wedding loans might be a savvier financial choice than a credit card, if you can get approved for a low interest rate.
Most lenders will give you a personal loan to use for any of life’s needs. Here are some companies that offer loans specifically for special occasions:
LightStream: This lender offers wedding loans from $5,000 to $100,000. LightStream loans have no prepayment fees, so if you want to pay off your debt early you won’t be penalized. You could even receive the money on the same day you apply.
Earnest: When you apply for a loan from Earnest, the company will ask how you plan to use the money. You can choose from options that include a wedding, engagement, or honeymoon.
Prosper: Prosper doesn’t specifically offer wedding loans, but you can select “special occasion” as the loan’s purpose when you apply. This peer-to-peer lending marketplace company offers fixed rates on its loans, and there’s no penalty for early repayment.
- SoFi: This lender offers personal loans with no origination fees or early repayment penalties. Plus, if you’re already a SoFi member, you could be eligible for an interest rate discount
- Upstart: When you apply at Upstart, the lender will review more than your credit score when offering you an interest rate — it’ll also factor your education and work experience.
3 ways to avoid borrowing money for your wedding
You don’t have to take out wedding loans to pay for your important day. In fact, in most cases, it’s better if you don’t. Here are three simple ways to tie the knot without going into debt.
1. Postpone your wedding until you’ve saved more money
Our recent wedding costs survey also found that 52% of couples plan to delay their wedding because of money concerns. While extending your engagement might not be your first choice, doing so can help you avoid wedding loans.
If you’ve delayed your wedding to boost your savings, brush up on tips and tricks to help you save money fast. You can focus on earning more money, too: Taking on a temporary side hustle can jumpstart your savings.
2. Cut unnecessary expenses
Weddings can get expensive fast, but you might be able to find items in your budget that you can live without.
For example, one of the biggest spending categories for weddings is decorations, according to the Knot study. You can avoid huge expenses if you find a venue that looks nice as is and if you’re willing to do your own decor or use fewer flowers.
You might even consider hosting the ceremony and reception at the same venue to eliminate some costs or save money by hosting a stand-up reception with appetizers instead of a full sit-down meal.
3. Have a private ceremony now and a big reception later
If you want a big reception but don’t want to delay the wedding, consider marrying now with a small ceremony before holding a larger reception later when you’ve saved enough money. This way, you can start married life on your preferred schedule and still have the beautiful party you’ve always dreamed of.
While you’re saving for your bigger reception, trim your costs to hit your goals. We’ve done the math — by cutting out extras such as cable subscriptions, gym memberships, and eating out, you can save as much as $500 a month.
Create a plan and stick to it
Before you take out wedding loans or borrow money for any reason, create a plan to repay your debt so that it doesn’t follow you throughout your marriage.
Interested in a personal loan?Here are the top personal loan lenders of 2018!
|Lender||APR Range||Loan Amount|
|1 Includes AutoPay discount. Important Disclosures for SoFi.
2 Includes AutoPay discount. Important Disclosures for Payoff.
3 Important Disclosures for FreedomPlus.
4 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
5 Important Disclosures for LendingPoint.
6 Important Disclosures for LendingClub.
All loans made by WebBank, Member FDIC. Your actual rate depends upon credit score, loan amount, loan term, and credit usage & history. The APR ranges from 6.16% to 35.89%. For example, you could receive a loan of $6,000 with an interest rate of 7.99% and a 5.00% origination fee of $300 for an APR of 11.51%. In this example, you will receive $5,700 and will make 36 monthly payments of $187.99. The total amount repayable will be $6,767.64. Your APR will be determined based on your credit at time of application. The origination fee ranges from 1% to 6% and the average origination fee is 5.49% as of Q1 2017. There is no down payment and there is never a prepayment penalty. Closing of your loan is contingent upon your agreement of all the required agreements and disclosures on the www.lendingclub.com website. All loans via LendingClub have a minimum repayment term of 36 months or longer.
7 Important Disclosures for Earnest.
8 Important Disclosures for Avant.
* The actual rate and loan amount that a customer qualifies for may vary based on credit determination and other factors. Funds are generally deposited via ACH for delivery next business day if approved by 4:30pm CT Monday-Friday. Avant branded credit products are issued by WebBank, member FDIC.
** Example: A $5,700 loan with an administration fee of 4.75% and an amount financed of $5,429.25, repayable in 36 monthly installments, would have an APR of 29.95% and monthly payments of $230.33
* Important Disclosures for Upgrade Bank.
Upgrade Bank Disclosures
** Accept your loan offer and your funds will be sent to your bank via ACH within one (1) business day of clearing necessary verifications. Availability of the funds is dependent on how quickly your bank processes this transaction. From the time of approval, funds should be available within four (4) business days.
|7.73% – 29.99%||$1,000 - $50,000||Visit Upstart|
|6.26% – 14.87%1||$5,000 - $100,000||Visit SoFi|
|6.99% – 35.97%*||$1,000 - $50,000||Visit Upgrade|
|8.00% – 25.00%2||$5,000 - $35,000||Visit Payoff|
|4.99% – 29.99%3||$10,000 - $35,000||Visit FreedomPlus|
|5.99% – 18.99%4||$5,000 - $50,000||Visit Citizens|
|15.49% – 34.49%5||$2,000 - $25,000||Visit LendingPoint|
|6.16% – 35.89%6||$1,000 - $40,000||Visit LendingClub|
|6.99% – 18.24%7||$5,000 - $75,000||Visit Earnest|
|9.95% – 35.99%8||$2,000 - $35,000||Visit Avant|