Marriages are once-in-a-lifetime events where both the partners and families combine their years of planning to create a special experience for the newlyweds. In order to make the event memorable and grand, it is important to plan the venue, entertainment options, outfits, gifts, and other arrangements. All of this will incur a lot of money and may not be affordable for many people and families. It is possible to cover all the marriage-related expenses with the marriage loan in India, which is available at very low interest rates. They are also very flexible and come with different EMI repayment options as well. Let’s look advantages and disadvantages of taking marriage loan in India:
Advantages of Marriage Loans
1. Easy application process:
It is possible to apply for and get a marriage loan in the comfort of one’s home. Applying for marriage loans does not require any proof and within a few clicks, one can apply for these loans through the mobile app or lender’s portal. Applicant will only have to submit their identity proof, passport size phone, address proof, etc, to apply for the loan.
2. Easy monthly payments:
Marriage loans come with easy repayment options and their EMI options are flexible as well. Before applying for a wedding loan, one has to calculate their monthly installments with the help of the EMI calculator. One has to enter your loan amount, maturity, and interest rate in this calculator and this will determine how much you will pay each month.
3. Marriage loans can be repaid quickly:
Wedding loans are types of personal loans, and thus, the loan application procedure is not complex. Lenders will make the selection criteria very simple; they will only evaluate the credit history and how best they will be able to repay the loan amount. Marriage loans often have adjustable payback durations, allowing borrowers to select a tenure that best suits their financial condition.
4. Excellent financial flexibility:
Marriage loans provide immediate access to a large sum of money, allowing couples to plan and execute their wedding without financial restraints. These loans can be used to pay for a variety of wedding-related expenses, including venue rental, catering, decorations, clothes, photos, and honeymoon.
5. Competitive interest rates:
People with good credit scores can typically get marriage loans at competitive interest rates, making borrowing more reasonable. Also, some of the lenders may provide special promotional interest rates or discounts for marriage loans.
6. Marriage loans can enhance the credit score of the borrower:
Making timely repayments on a marriage loan can assist in enhancing the borrower’s credit score, which can be useful for future borrowing as well. Some financial houses offer specialized wedding loans with unique features such as low processing fees, extensive grace periods to repay loans, etc.
Disadvantages of Marriage Loans
1. Higher Interest Rates:
Marriage loan interest rates can be slightly higher because they are unsecured. Wedding loans offer higher interest rates than other types of loans as the banks are not asking for any type of collaterals. If the credit score of the borrower is low, then they might attract higher interest rates, making these loans very expensive over time.
2. Requires extensive research:
There are a number of lenders who offer marriage loans. Therefore, it is mandatory to undertake extensive research to identify a lender who offers the most amounts at the lowest interest rate.
It is important to evaluate a variety of things. These include tenure flexibility, processing costs, approval and disbursement time, documentation, foreclosure charges, EMI bounce fees, and hidden charges when comparing lenders.
3. Emotional Burden:
Taking out a loan raises one’s total financial burden. There are chances for the marriage loan debt to put financial strain on the relationship. Making consistent monthly payments can put pressure on your budget, especially if you already have other financial obligations.
4. Impact on the credit score:
Missing payments or defaulting on a loan can have a negative influence on your credit score. This might make it difficult to get credits in the future. Taking out a large loan might also have a negative impact on your credit score, even if you make payments on time.
5. Loan processing fees:
Many lenders charge processing costs for loan acceptance, which raises the total cost. Some loans have early repayment penalties, which limit one’s ability to repay the loan ahead of schedule without paying additional fees.
Comparison Between Advantages and Disadvantages of Marriage Loans:
| Advantages of Marriage Loans |
Disadvantages of Marriage Loans |
| Offers immediate access to money, which can be of great use in managing the wedding expenses. | Though it offers instant money, it increases the overall debt burden. |
| Newlyweds can avoid depleting their emergency funds and savings | They end up repaying the wedding debt instead of investing in other property or saving money. |
| Marriage loans in India have fixed tenures and fixed monthly payments. | Having to repay the loan amount every month, strains the budget of the couple. |
| Those with good credit scores can get loans at reduced interest rates. | High interest rates for borrowers who have low credit scores. |
| Timely repayment of the loans can improve the credit score. | If monthly payments are missed, then it will affect the credit score. |
| The application process is simple, and approval is quick | There could be processing fees and hidden charges. |
