A big fat Indian wedding also means big fat expenses for the couple and the parents of the couple! Celebrating a child’s wedding is one of the most important occasions in any parent’s life – and in India, this most joyous of occasions involve expenses on an equally grand scale. Few people have ready cash to fund expenditure of such a magnitude – which is why many parents and individuals look for a loan for marriage expenses and take out a personal loan that can help them tide over this huge cash outflow.
While there is no specific product that is a loan for marriage, a personal loan is one of the most convenient options for covering the huge costs of a wedding. It can be used for any purpose – whether a wedding celebration or an expensive vacation or even medical emergencies. Most banks and NBFCs offer personal loans, though one needs to keep in mind the relatively high interest rate - it is one of the most expensive loans to take as the customer does not provide any collateral or security.
How to apply for a personal loan
It is easy to apply for a loan for marriage expenses to help you cover wedding expenses by applying for a personal loan. The loan amount can range from a few thousands to a few lakhs depending on your ability to repay. You can check your eligibility online at several bank/lender websites before applying to check if you qualify for a loan. You can apply for the loan online or visit a branch for details.
There is not much documentation as the loan can be used for any purpose and could include ID proof, address proof, bank statements and salary slips. The documentation required will vary with each bank and depends on your profession, income and loan requirement.
Interest rate and tenure
The interest rate charged depends on a number of factors including income, profession, credit score and relationship with the bank among others. In general, the interest rate on personal loans can range from 15%-20%. The loan period typically ranges from 1-5 years.
Advantages of a personal loan
There are two attractive features of a personal loan:
• Complete flexibility of end-use. There are no restrictions on how you should spend the loan amount. You can use the entire loan amount to cover the wedding expenses ranging from clothes and jewelry to hiring the hall, caterers and any other expenses. You have complete freedom to use the money for any purpose you want, even it is not related to the marriage.
• Lack of collateral. A personal loan is an ‘unsecured loan’, meaning you are not required to provide any security to the lender in the form of cash, shares or any other assets. This might make it more attractive to some customers who may not be able to raise the collateral required.