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5 Good and Bad Reasons for Taking Wedding Loan

5 Good and Bad Reasons for Taking Wedding Loan

Like most good things in life, your wedding is one of the most important eventsthat you can think of. Be it an extravagant affair or small gathering of your favourite people, the memories you make for yourself on your wedding day stays with you for a long time. However, making grand memories, like most things, do cost money. You have the option of asking your parents/relatives to lend you some money as it was difficult to get a loan from a financial institution. However, those days are long gone as it has become easy to avail a wedding loan.

There are 2 sides to every coin and availing a wedding loan, too, has its pros and cons. So if you are wondering if you need to avail here are 5 good reasons to take a wedding loan:

  1. Zero Collateral: A personal loan for a wedding is an unsecured loan, which means you wouldn’t be required to keep any collateral while availing the wedding loan.
  2. Minimal documentation: Unlike other secured loans, you will be only required to furnish your basic KYC documentation including your Aadhar card, CIBIL score along with your bank statement and salary slip for 3 months. Since the personal loan is for your wedding, you will also need to provide your wedding card as well
  3. Quick Disbursement: Disbursement time for a wedding loan take about 72 hours once all your documentation has been approved by the financial institutions
  4. All expenses are covered: Your wedding loan can cover all the expenses that are incurred during the event. Be it paying for the reception hall, the caterers or even your honeymoon, you can use the loan for the wedding for any purpose.
  5. Affordable: One of the best things about apersonal loan for a wedding is that you can avail any amount uptoRs 25 lakhs. Once you understand your budget, you can apply for only the amount that you. This makes it easier for you to understand your EMI as well as the interest you will be paying on the wedding loan.

Now, just like the good things in life, a wedding loan is also known to have its downsides:

  1. Additional Debt: A loan is still a debt in your name. This would mean that you will have an additional outflow of your income and resources when you avail a personal loan as well. Though your burden of paying for the expenses reduces when you have a loan for your wedding, it also dips into your future savings in the means of the EMI.
  2. High-interest rate: Since there is no collateral or security to be kept while availing a personal loan for a wedding, there are high chances that you will be paying high-interest rates on the wedding loan. This would equate to higher outflow when it comes to repayment.
  3. Unnecessary spending: It is human nature that you will spend the money that you have. Once you avail a personal loan for a wedding, your budget for the wedding will also go high, which means you will be spending more than the required amount, thus accumulating more debt.
  4. Lower credit ratings: Applying for a personal loan can bring down your credit ratings. If you have already availed a loan in the past, additional loans can bring down your credit score.
  5. Non-approval of required amount: Even If you have applied for a wedding loan, chances are that you may not get the required amount for your wedding. This decision is solely based on your credit score and your repayment ability as well.

There are advantages and disadvantages to everything in life. If you need funds to support yourself for your big day, then the decision to avail a wedding loan is your choice. However, always check your best option before you make a decision.

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