Weddings can be costly affair if not planned well and in some cases you might find it hard to meet the wedding expenses from your own pocket. Not to worry, there are banks and NBFCs to cater to your this need. But the question is should you be really going to these financial institutions for funding wedding for your near and dear one's.
Here's a take on this in detail here.
Salient features of the special wedding loan
Some of the big banks such as ICICI Bank, Axis Bank, SBI Bank as well as some other NBFCs including Bajaj Finance, Tata Capital have come up with special wedding loans. These are in general similar to personal loans and interest on these loans is either at par with personal loans or a way higher.
For you to be eligible for this loan, you have to be earning concern either a self-employed or salaried individual in the age bracket of 21 years and 65 years. Also, income slab has been specified and differs from bank to bank. Also, if you fall in the employed category, banks require that you be in service for minimum of 2 years.
Regardless of the bank's minimum and maximum finance extended under the wedding loan scheme. The amount sanctioned to you is also determined based on your credit score. Also, in case a co-applicant for the loan is increased by another individual, the eligibility amount for the loan on offer can be increased.
Tenure and repayment schedule:: As in case of the loan eligibility amount, the repayment capacity for the wedding loan which in general comes with a tenure of 5-7 years can be increased.
For the documentation: You would need to submit income proof, salary slips, bank statement and in case a person getting married takes loan in his or her name then marriage invite together with other supporting regarding arrangements made shall have to be furnished.
Interest rate: In line with the personal loans, the interest rate for the loan category ranges between 11-22% with processing charges. Prepayment charges also apply which differ from bank to bank.
Conclusion: As per experts, it is better to take a personal loan as against special wedding loans as there can be chances that institutions try to capitalize on your urgency and charge you higher. Also as these loans are provided by only some financial institutions, there may be a chance that you crack a better loan deal with some other player.