Wedding Loans: 6 Things to Consider

Things to consider before taking out a wedding loan

Getting married is one of the most important milestones couples share, so it’s no surprise that people planning a wedding worry a lot about the cost. When it comes to the various options available to pay for your wedding, it’s important to find one that suits your needs and financial circumstances.

We explore some of the ways you can fund your big day, and help you understand some important considerations if you’re going down the borrowing route.

What is a 'wedding loan'?

A wedding loan is simply a personal loan that you can apply for to cover the cost of your wedding. Wedding loans let you borrow a fixed sum of money on an unsecured basis for a short term. Pepper lets you take out a wedding loan with a variable or fixed interest rate, and lets you choose to make your repayments weekly, fortnightly or monthly.

60% of 400 online respondents surveyed used a loan as a way to finance their wedding.

What to consider before taking on a wedding loan

Wedding loans are becoming an increasingly common way for people to pay for their weddings – a survey by the Australian Securities and Investments Commission (ASIC) showed that 60% of 400 online respondents used a personal loan as a way to finance their wedding.

Before deciding to get a personal loan for your big day, there are some things you need to think about, including:


Serviceability is your ability to make repayments on a loan after all of the other expenses you have to pay each month are covered.

The factors that define serviceability vary but lenders like Pepper Money can use both a serviceability calculation as well as the debt service ratio to determine how desirable a borrower may be. 

Credit score

This is a detailed record of your financial history, which is evaluated by lenders when assessing your loan application. Having a poor credit score doesn’t mean you can’t get a loan, but it does impact how desirable you are as a loan candidate

Loan terms

Stretching your loan means your repayment is a smaller dollar figure over a longer period, but it’ll mean paying more interest overall and you’ll be in debt for longer.

Interest rates

A fixed rate means the interest won’t change over the course of your loan, while a variable rate means it could go up and down as market rates change.

Additional fees and charges

Lenders may charge fees for defaulting, pre-payment, etc.

Supporting documentation

It’s often necessary to show documentation to help lenders assess your eligibility. This can include things like your bank statements, proof of identity and proof of income.

Pros and cons of using a personal loan to finance your wedding

Choosing to finance your wedding will ultimately depend on your circumstances and personal preferences. Wedding loans are convenient for a few reasons, mainly because they allow you to manage the cost of your wedding over time.

Spreading payments may mean you can afford more of the features you want for your wedding, and you won't have the stress that a tight budget can bring.

However, borrowing isn’t a solution for everyone. Some couples prefer to get the cost out of the way and avoid worrying about debt after the wedding.

Alternative ways to finance your wedding

Loans are not your only option. Here are a few alternative ways of obtaining the money you need to fund your big day:

  • Credit cards: Depending on the amount you are looking to borrow, credit cards can also seem like a convenient option. Credit cards operate on a revolving line of credit (so there’s no fixed term for borrowing), however this does mean you will be faced with substantially higher interest charges if you don’t pay it off quickly.
  • Borrowing from family: Another option is to see if there is a family member who could lend you some money.
  • Pushing back the wedding: You can also consider pushing back the date of your wedding to allow more time to save what you need and to avoid the stress of borrowing anything at all.

If your dream day is on the horizon, and you don't have enough funds to cover the full cost of your wedding, applying for a personal loan may be an option.

To get you started, find out how much your individual rate and repayments might be before applying here, without affecting your credit score. 

Got a question? Give us a call on 1300 108 794. We're here to help.

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