A wedding loan can be applied for by an individual or together with the partner. A joint application improves creditworthiness if both partners earn. But there is a disadvantage. Both partners become borrowers. The credit appears in the Credit Checker files of both partners. It is not a negative entry. The proper repayment of a loan is even rated positively.
But pre-credits in the Credit Checker file influence the creditworthiness with a view to further borrowing. The loans can then become a little more expensive. For wedding loans of larger amounts starting at around 10,000 dollars, many banks will expect the loan contract to be signed by both future spouses.
What is a wedding loan?
Wedding loans are often promoted in the shop windows of bank branches and on the Internet. This can give the impression that these are special loans at, particularly favorable terms. This impression is wrong. Wedding loans are not earmarked loans that can only be taken out for wedding expenses and are therefore particularly cheap.
Instead, they are normal loans for free use. In some credit calculators, you can find wedding loans separately in the drop-down menu for the intended use. This is only intended to address a specific group of customers in a very special way. This does not change the nature of the loan as a freely usable loan.
Wedding loans are also generally not cheaper than other free-use installment loans. Sometimes certain banks offer special wedding loans that have different terms than the usual installment loans issued by the bank. For example, a fixed interest rate is offered or special terms can be agreed upon. It may also happen that the interest rates are cheaper than for other installment loans issued by the bank.
It is often a matter of temporary advertising measures
However, the fact that the wedding loan is cheaper than the installment loans otherwise issued by the bank does not mean anything about the fact that there are no better interest rates anywhere else without a separate wedding loan being offered.
Even such special offers should not prevent you from carrying out a loan comparison.
Choose the appropriate loan amount
What expenses do you want to finance with a wedding loan? Get an overview before you make a loan request and estimate the costs.
The following costs are usually incurred during a wedding:
- Wedding rings.
- Clothing and other equipment for the bride and groom.
- Wedding menu and drinks along with room rental and flower arrangements.
- Invitations and, if necessary, thanks, plus postage.
- Possibly professional wedding outfitters (party service).
- Possibly the accommodation of guests.
- Wedding photos.
- Honeymoon, honeymoon.
The amounts to be used for the individual positions depend on your wishes and the wishes of the partner.
As with a comparison, you can save costs by obtaining and comparing several offers for the individual items.
Sometimes, even before the wedding, it is foreseeable that other expenses (partly) will be financed by credit.
For example, it is planned to take out a loan for the initial furnishing of the marriage apartment. Or the purchase of another car is necessary.
In such cases, you should try to include these expenses in the wedding loan.
It is very impractical to take out two loans in quick succession. The credit rating for the second loan is burdened by the wedding loan, which results in poorer loan conditions.
If you have an overview of the total cost of the planned wedding, it is now about limiting the credit requirements.
Think about the amount you can raise from your own funds. If you finance part of the expenses yourself, you can save costs.
Wedding credit with free special repayment
Therefore, they do not only pay attention to a low annual percentage rate. A cheap wedding loan has both: low-interest rates and flexible repayment rules.
Almost all banks grant customers free special repayments. There is also loan offers with free early repayment.
According to the law, you can repay installment loans to consumers with a fixed borrowing rate in whole or in part at any time.
However, the bank can demand prepayment penalties amounting to 1.0% of the amount made out of line (for remaining terms of one year or less 0.5%).
If the bank waives prepayment penalties for special payments, you can significantly reduce the total cost of the loan with special payments. By shortening the term, you will also be debt-free faster and have a better credit rating.