Marriage is an important life milestone. It requires financial planning. Planning your wedding helps you arrange the required funds. It’s not uncommon for people to exceed their wedding budgets. A personal loan can help you tide over a problem like that.
Here is how a personal loan can come to your rescue when you need money for your marriage.
Quick Availability of Funds
A personal loan is preferred owing to easy access to funds. It is the kind of loan which can be processed in a few minutes, and you don’t need to go through a cumbersome application process.
Adhil Shetty, CEO, Bankbazaar.com, says, “You can apply for a personal loan online. If you’re pre-approved, you can get the loan within the day. Several lenders may have created pre-approved offers for you basis your income and credit score. You can go online to check these offers, compare them, and avail them paperlessly.”
No Restrictions On Usage of Money
When you take a home loan or a car loan, the loan cheque is given directly to the property seller or the car dealer. On the other hand, when you apply for a personal loan, the payment is credited directly to your bank account. You’re free to use the funds in any manner. However, lenders generally warn against using the money for speculative activities such as stock market investments. But for weddings, you can use the funds as per your wish, be it paying the caterer, the event management team, or the venue. There is no restriction on how you spend the personal loan money on your marriage.
Flexibility to Choose Repayment Tenure
When applying for a personal loan, you can choose the repayment tenure as per your repayment capacity and financial comfort. Usually, banks allow a repayment tenure of up to 60 months on a personal loan, but some NBFCs may go up to 84 months. You can choose the appropriate repayment tenure basis your other financial obligations. Keep the tenure as short as possible to minimise interest costs.
Personal Loan Vs Wedding-Specific Unsecured Loan
A wedding/marriage unsecured loan and a personal loan are usually the same loan instruments with different names. Having a wedding loan as a separate lending instrument helps the lenders to come up with seasonal product-specific offers to attract customers. “There is no restriction on how you utilise the loan amount that you receive in a wedding loan which is similar to a personal loan. Interest and charges on wedding loans and personal loans may vary depending on the lender’s offering, so you must compare all the available options before applying for the loan,” adds Shetty.
Tips For Personal Loan Borrowers
Check your credit score, repayment capacity, income stability, etc., before applying for a personal loan. There are many variants of personal loans in the market, so you must compare them to find the one that suits your requirement in terms of tenure, interest rate, charges, and size of the offered loan amount. Below is a table the gives you some idea on how much EMI you will pay when you take a loan of Rs 3 lakh for three years at different interest rates.
Note: Data for illustration purpose only. Table consists of lowest interest on personal loan by selected banks irrespective of the loan amount. Data collected from respective bank’s website as on 08 June 2022. EMI is calculated on the basis of Interest rate mentioned in the table for Rs 3 Lac Loan with a tenure of 3 years (processing and other charges are assumed to be zero for EMI calculation); Interest and charges mentioned in the table are indicative and it may vary depending on bank’s T&C. ^^For Govt employee and defence personnel; *for doctors
Finally, a piece of advice is that you must factor in all the pros and cons when you apply for a personal loan, including interest rates, tenure, and repayments. A personal loan can be used as an emergency borrowing tool to overcome a financial shortfall. Timely repayment and financial discipline are a must when you plan to take a personal loan.
