When you have bad credit or no credit history, engagement ring financing can seem like a daunting task.
Aside from all of the nerves and butterflies about popping the question, the thought of funding an engagement ring can seem scary enough. Even more if you’ve had problems borrowing money before.
Thankfully, there are loans available for those in your situation that can help you pull together the money to buy the perfect ring.
Before you think about engagement ring financing, consider all options
Forget that old rule that an engagement ring should cost two months’ salary. That saying was started by De Beers, a diamond company that wanted to earn even more money during the 1980s. Even before that, they had invented the concept of spending a month’s salary when they had a bit of a dry spell during the Great Depression.
Before their campaign in the 1930s, less than 10% of engagement rings were diamond rings. Now, it’s estimated that over 80% of engagement rings are diamond rings or contain diamonds. Clever, eh? (For the record, in Japan, the same company promoted spending three month’s salary on rings, and that worked too!)
What we’re saying is – don’t feel that you have to splash the cash to fund the perfect ring. If diamonds really are your girl’s (or man’s) best friend, then look around – there are lots of places that sell slightly cheaper alternatives that are guaranteed to make them just as happy.
Equally, if you think that your partner might be just as happy – if not happier – with a vintage ring, a ring with a different precious stone or maybe even a family heirloom, then you might be able to save yourself a few quid and still guarantee that speechless reaction.
eBay, preloved and even your local pawnbroker can be a great place to search for bargain price (but still great quality) engagement rings, not to mention asking your older relatives if they have any special jewellery you could use for the big moment. Actually, lots of women prefer being given family heirlooms as they have a lot more meaning and sentiment.
And you find the thought of proposing with a second-hand ring a little off-putting, just remember – it was good enough for Kate Middleton.
Engagement ring financing with bad credit
Sometimes – whether you’re looking for a brand new diamond ring or a second-hand gem– you just can’t make your budget stretch (especially if you’re trying to keep the transaction a secret) and you need to look for alternative options.
If you have poor credit, it can be difficult to think of ways to fund the perfect ring that don’t involve saving for ages.
Of course, some jewellers and jewellery shops offer 0% engagement ring financing options with attractive repayment options. If you qualify for these – and you’re sure that you can pay off the balance before the interest rates (which are usually very high) kick in – then these options can be a good way of buying an engagement ring and paying it back over time.
On top of that, if you have a credit card, you can do things in much the same way. Buying an engagement ring with a credit card – and paying the amount back over time – is one of the most common ways of funding that dream ring. However, it’s not without a catch, and is often one of the more expensive approaches.
In the long run, your engagement ring could end up costing a LOT more than you expected when you take into account all of the interest.
Engagement ring financing – an alternative approach
If 0% finance and credit cards aren’t an option for you – or you think that the credit card approach may cost you more money in the long run – there are personal loans available for people with bad credit to borrow the amount needed to buy that special ring.
Depending on your credit score, you could be eligible for either an unsecured or guarantor loan.
An unsecured personal loan or guarantor loan will allow you to pay back the amount back with regular monthly payments. On top of that, regular payments like this help to build your credit score to help you qualify for different products and lower interest rates in the future.
Unsecured loans are typically for people with a fairly good credit score, while guarantor loans have been specifically designed for people with bad credit.
That’s more than enough for the perfect ring – and even for a trip to make the proposal even more unforgettable!
Although we know how important it can feel to get the perfect ring, it’s important to remember that you should only spend (or borrow) what you can afford.
For a few hints and tips on how to keep the cost of the wedding down, check out our handy wedding tips.