Home > Personal Loans > A Free $10,000 Wedding Loan? Yes, But There’s a Catch

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Weddings can certainly cost couples a pretty penny — In fact, an annual survey from TheKnot put the average cost of one in 2014 at $31,213, up from a mere $29,858 the year before. Given the high costs associated with these big days, it’s no wonder many brides and grooms are turning to personal loans as a way to fund their flowers, favors and/or chocolate fountains.

Of course, taking out a loan to fund your wedding typically means starting your marriage off with varying levels of debt, but one Seattle-based startup is trying to eliminate that initial installment payment from the equation. SwanLuv said it will give approved borrowers up to $10,000 to fund their dream wedding. That’s right, it’s offering free wedding loans — so long as you and your beloved make good on forever. Should you ultimately decide to get a divorce, you and your ex-spouse would be required to pay the full amount of the loan, plus all the interest that accrued over the course of your marriage, split right down the middle.

But SwanLuv CEO and founder Scott Avy said his company is not banking on divorce. Instead, “what we’re all about is everlasting marriage,” he said. That’s why, according to Avy, all the interest paid out on financing will be put towards funding more loans (and free couples counseling will be made available to borrowers.) The company revenue will come “through advertising partnerships,” he said.

Avy declined to provide more specifics about what these advertising partnerships would entail or whether SwanLuv planned to share any of the data it collected during its underwriting process with the partners in question. “When we do launch, it’s going to be very transparent with regard to what will be shared,” he said. Avy also wouldn’t say specifically what interest rate prospective borrowers could expect to be offered on their loan, just that it “wouldn’t be anything insane” and didn’t respond to follow-up questions about whether the loan balances and/or payment histories would be reported to the three major credit bureaus.

Anyone looking for more details on those terms and conditions will have to wait until the startup officially launches on Feb. 15. The company is currently collecting email addresses from interested couples (which won’t be shared with third parties, Avy said.) Once SwanLuv opens for business, they’ll be invited to fill out an application. But couples should expect to provide more than just name, address and annual income if they want to get financing for their big day. “It’s [going to] be pretty detailed with regard to who the couple is,” Avy said.

Wedding Loan 101

SwanLuv’s financing may sound sweet when it comes time to say “I do,” but it could also cost you a pretty penny if your marriage doesn’t work out in the long run. Personal loans can feature annual percentage rates between 6.85% to 19.77%, so, even if SwanLuv were to offer a rate well below that scale, you could find yourself saddled with a significant amount of interest … particularly if you’re married for a long time before deciding to call it quits. (Avy said, depending on the situation, ex-spouses could be given the opportunity to work out some type of payment plan, should they divorce and have to repay the financing.)

Couples looking to take out any type of wedding loan should read the terms and conditions associated with the offer very carefully. They should also be sure to shop around for competitive rates. And it’s in your best interest (literally) to check your credit before you fill out any applications, since a good credit score generally entitles you to better financing terms. (You can view your credit scores for free each month on Credit.com.) Soon-to-be husbands and wives can also potentially lower the cost of their wedding by saving during a long engagement, cutting back on unnecessary expenses and taking on additional jobs or side gigs ahead of the big day.

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