While the number of marriages continues to drop (231,000 in 2015 against 283,000 ten years earlier) (1), the lowest since the post-war period and young people are getting married more and more later ( 32 years on average for men and 30 years for women), (1) many couples take out a marriage loan to finance a day that everyone hopes will be unforgettable. Advice from our experts on what is ultimately just a personal loan.
Prefer an amortizable loan rather than a revolving credit
It all depends on whether you take out your marriage credit with your bank or compare online loan offers.
In the first case, there is a good chance that your advisor will offer you a personal loan that will be amortized and will adapt to your budget. You will decide with him the choice of duration depending on the amount borrowed and your repayment capacity.
On the other hand, if you subscribe to one of the many online offers (see our comparison table), you are likely to fall on a revolving credit. Long criticized by consumer associations and regularly in the crosshairs of public authorities, these loans can present a trap in that they replenish the initial reserve as repayments are made. In addition, they have the disadvantage of being often more expensive than amortizable loans.
How far in advance should you subscribe?
Whether to reserve the room or to order the caterer, you will need to pay a deposit. If you have the capital to pay the installments for this, you can wait until the last weeks before the wedding to take out the loan.
However, count two months between the constitution of the file and the release of funds to be completely quiet, because depending on your financial situation and the amount borrowed, the risk analysis may take more or less time. Be aware that insurance (if you decide to purchase it) can also extend the time, especially if there are medical problems.
If the loan is to be used to pay the deposit, remember to submit your file well in advance in order to have the funds when you make the first reservations. Finally, if you choose a repayable loan, be aware that you will have to repay principal and interest on the entire amount borrowed, even if you have not used it in full.
The legal withdrawal period
You have a period of 14 calendar days from the day of signing the loan offer to withdraw. Until its expiration, you can cancel at any time without having to justify your decision.
Important: the release of funds cannot take place before the end of the withdrawal period.
Supporting documents to provide
You must provide a number of documents to allow the bank to analyze the feasibility of your project. They will be requested from both conventional bank as well as from online credit organizations.
It is requested for each co-borrower:
- The last 3 account statements
- The last 3 payslips
- The latest tax notice
- Proof of address
- The last receipt for rent paid, if you are a tenant
- The amortization table for all outstanding loans.
Important: you will not be asked for any proof of expenditure.
The law allows you to prepay all or part of your loan, but depending on the case, you must pay reimbursement penalty indemnities.
|Type of loan||Characteristics
|Revolving credit||–||No penalty|
|Depreciable loan||Refund within 12 months <$ 10,000||No penalty|
|Refund over 12 months> $ 10,000||
Important: be aware that many banking offers allow you to benefit from the same elements of flexibility as mortgage loans, namely increasing, decreasing or suspending monthly payments.
What are the offers of online credit organizations worth?
As you can see below on our comparison table, many credit players offer to take out your wedding credit online and often give an immediate response in principle.
Note, however, that most of the offers correspond to revolving credits.
Since the last reforms, the advertisements have been sufficiently detailed (mention of the APR, compulsory quantified example, etc.) so that the borrower can make his choice with full knowledge of the facts. The fact remains that many households fall into the trap of a loan which replenishes itself automatically after each repayment. Our opinion: These offers can be interesting if you do not fall into the trap of replenishing the money reserve and if you do not want to change banks. Still, the proposed rate must be attractive, which is not always the case
Should you take out optional insurance?
Loan insurance is optional in the context of a consumer loan, but we strongly recommend that you take it out, if only because of its low cost. For example, a conventional contract covering the risks of death, invalidity and incapacity for work would cost only $ 1.25 per month (1).
Our advice: favor an external delegation which allows individual membership. Given your young age, you will get more competitive rates than with the group banking contract.
(1): on the basis of a credit of $ 10,000 at an insurance rate on borrowed capital of 0.15% and a quota of 50% on each head.
Take out the loan alone or as a couple?
If you are financing the entire wedding with a personal loan, you should both be included in the loan agreement as joint borrowers, and that, whatever the matrimonial regime you choose: legal community or separate property. You will both be responsible for the repayment, as will be the case throughout your common life for all of your debts.
The different aids
From the family
Many parents participate financially in the marriage of their children, the family of each fiance then putting his hand in the pocket to take care of all or part of the festivities. However, their financial means must allow it.
When this is not the case or when the newlyweds wish to be financially independent, there is a solution to avoid marriage credit: the family loan.
It is a solution that allows parents to keep their savings and children to maintain financial independence. In addition, the loan can be repaid with more flexibility than with a conventional bank loan.
Evaluate your budget
Before comparing the financing offers, you will calculate the budget that you will devote to organizing your wedding. You will find on the Internet many sites which will help you to draw up the complete list of the items of expenditure and even simulators which will make it possible to obtain an average budget.
The cost will of course depend on your tastes, the number of guests and the services you add (DJ, photographer, etc.). If certain items are important such as the wedding dress, the rental of the room or the meal, small expenses should not be neglected because they can quickly make you cross the red line.
Remember that the results you get on specialized websites only give a price range. In no case can they be used to calculate the loan amount.
Our advice: do not start your research for financing until you have the final figures and plan a margin of error. Do not forget in case you borrow a few hundred USD too much that you can repay them without penalty.
It is not a very developed phenomenon in France, but it is a common practice across the Atlantic and which appeared in France a few years ago. Sponsored marriage has many advantages, but it requires a very large investment from the newlyweds. In addition, the actions require great organization and must be undertaken well in advance.
If it is illusory to seek free services, but rather a discount on the rates of providers. It is still necessary to be able to offer them advertising actions (Blog, social networks, local press) up to the challenge.