Funeral Loans: The Best Available Options In 2020
When a loved one dies, many people find themselves in a surprising financial situation. If there was no money set aside for burial costs, it might be up to you to ensure your friend or family member gets the funeral service they wanted and deserved.
Burials in 2020 can cost between $7,000 to $12,000, making them no small expense to spare. Loans for funeral services might be the only option for your financial situation.
When no funds are set aside, many find themselves turning to funeral financing loans. This type of lending product can help you with everything, from transportation to the cost of burial. Keep reading to learn more about its risks and benefits.
Advantages And Disadvantages Of Funeral Loans
If you’re struggling to cover the cost of a loved one’s burial, then funeral financing might be your best option. Here are some of its advantages:
- Personal loans tend to distribute funds quickly so you can get access to the cash you need in a matter of a few days
- Funeral loans for bad credit are an option with personal loans
- Most loans for funeral expenses don’t require collateral, so assets like your home and car remain secure
Disadvantages of this financing option might include:
- Unsecured loans tend to come with higher interest rates, and if you have bad credit, then you’ll be especially vulnerable to a high rate
- If you miss your monthly payment, it’ll negatively affect your credit score
The Steps To Take Out A Funeral Loan
The steps for taking out a personal loan for a funeral are similar to other types of lending products.
- Carefully consider loan options and decide what kind of personal loan, secured or unsecured, is right for you
- Check your score, credit history, and financial situation. However, since burial services are more time-sensitive matters, you might not have much time to improve your rating
- Research various lenders and inquire with potential funeral homes about financing
- Prepare your loan application carefully and have your proof of identification, address, and income ready
- Compare offers from lenders. Make sure to pay attention to hidden fees and specific terms
The specific process may be different according to each lender’s specifications. In general, personal loans are given quickly, so it’ll be helpful to have all of your materials prepared and ready. It can be difficult to concentrate and make clear decisions when you’re grieving a loved one, so consider asking someone you trust to help you with the process.
Best Funeral Loan Lenders
Each lender may offer you different terms and require various fees. Moreover, it’s crucial that you feel comfortable with the lending institution that you choose. Some top funeral burial loan lenders include:
- SoFi: Offers both secured and unsecured loans with variable or fixed interest rates. This company also provides the option for you to use a co-signer. The candidates SoFi accepts typically need a strong financial history and a good score. Moreover, its loans range from $5,000 to $100,000 with a tenure of two to seven years
- Avant: Time is often of the essence with funeral loans, so you can take advantage of Avant’s emergency loans. These range from $2,000 to $35,000 with an APR of 9.95% - 35.99%. The tenure can range from 24 to 60 months
- Upstart: Two major bonuses of this company include next-day funding and no early repayment penalty. In addition, loans range from $1,000 to $50,000 for three to five-year terms with 8.69% - 35.99% APR
Funeral Loan Alternatives
It’s best to consider all financial options before taking out a loan for funeral costs. Alternatives include:
- Friends and family: The financial burden isn’t necessarily yours alone to bear. In order to support burial costs, try gathering funds from friends and family of the deceased member
- Veterans benefits: If your loved one was a veteran, they might be eligible for financing to help cover the burial expenses
- Funeral homes: You may wonder, do funeral homes offer financing? You can check with different homes and see if and how they may be willing to work with you
- Credit card: If you can feasibly repay the service expenses within a year and a half and have good enough credit to qualify for 0% APR, then this might be a great option for you
Dealing with the death of someone close to you is hard enough, you shouldn’t be bogged down by the stress of burial expenses. If you can, help loved ones plan in advance.
If you find yourself faced with an unexpected death, take the time to carefully consider all offers and try to make the decision with as clear of a mind as possible.