There are two ways of getting credit during your marriage. Either take a secured loan against the mortgage of a property, else apply for an unsecured personal loan for marriage expenses. Check the following advantages and disadvantages of availing a personal loan for marriage.
Pros of Availing a Personal Loan for Marriage
The benefits of a wedding loan include:
Extensive loan amount
The amount of loan you can avail depends on factors such as income, existing liabilities, employment history, credit history, and city of residence. Applicants can use an online eligibility calculator to know the maximum amount they are eligible for. Avoid applying for any higher amount, so as to prevent rejection of your loan applications.
Top-up facility available
A top-up facility allows you to avail additional amount over and above your existing loan to meet additional expenses. If you have an existing loan account, you can apply for a top-up loan at the time of your marriage to meet the wedding expenses.
No collateral loan
To avail a personal loan for marriage, you do not need to mortgage any property or jewellery as security. This is an attractive feature of a marriage loan as you can get instant approval of such loans subject to fulfilling certain eligibility conditions. Check all the criteria on the official website of your preferred lender and apply for the loan online. Renowned lenders credit the loan amount in to your account with 24 to 48 hours.
Flexible repayment tenure
You will have the flexibility to choose the loan repayment tenure at your convenience. This is beneficial as you can easily opt for a longer tenure to reduce monthly instalments considerably. However, this option is available only to those individuals who have enough earning years remaining. This means if you are close to retirement age, the financial institution decides on the loan repayment tenure before retirement. Increasing the tenure reduces the EMI amount, but the total cost of loan increases as you pay interest for a longer time period. Use the EMI calculator and arrive at a tenure which keeps EMIs affordable.
Minimal foreclosure charges
The foreclosure charges in case of a marriage loan are affordable. This is extremely beneficial as it saves up on additional interest accumulation as well as you do not need to stretch the tenure unnecessarily if you have enough money to pay them off before the end of the tenure.
Affordable interest rates
The interest rates on a wedding loan offered by several financial institutions are competitive. This keeps the monthly EMIs within the affordable range.
Additionally, you can opt for a personal loan balance transfer to save more on your monthly instalments in case any other lender offers the loan at cheaper interest rates and better repayment terms.
Easy application process
A marriage loan application process is completely online. Follow some simple steps to submit your online application. The documents required are also minimal. Hence, you can apply for a wedding loan within a few minutes. Nonetheless, you must consider reviewing your application form before submitting it to avoid any errors leading to rejection.
Cons of a Personal Loan for Marriage
The cons of a wedding loan include:
Disruption of monthly budget
No matter how less the monthly instalments are, they continue to be an additional load on your monthly liabilities. Hence, you need to plan your finances strategically and strictly adhere to the monthly budget so that you continue repaying the loan within the due date.
Extensive interest rate comparison
Before deciding on a financial institution, it is a must to compare the interest rates offered by different financial institutions. Also, you must compare all other associated charges and fees. At the time, the research becomes extensive, and you tend to lose track. So, refer to sites where you can get a complete comparison of interest to save time and go for the best offer.
A high CIBIL score is a must
Since a wedding loan is an unsecured form of loan, it is a must that individuals should possess a high CIBIL score. A healthy credit score makes the loan seeker seem trustworthy and responsible. Financial institutions understand that a borrower with a higher CIBIL score can plan their finances well and will surely pay the monthly instalments on time and pay off the loan without default.
Now that you have a clear idea of the pros and cons of taking a personal loan for marriage, you can decide on going forward with the same. Additionally, you must carefully re-check the documents you are uploading before submitting the documents to avoid rejection.