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The death of a much-loved family member or friend can be an incredibly difficult time. While the emotional impact of your loss will no doubt be at the front of your mind, the unfortunate reality is that a person’s death can also place a significant financial burden on those left behind. Funerals can cost as much as $15,000 to organise, which can place a significant strain on your bank balance at a time when you’ve got much more important things on your mind.
However, to help you cover the cost of giving your loved one a proper farewell, you may want to consider a funeral loan.
Many people underestimate or simply don’t even think about just how much funerals cost. In Australia, the total cost of a funeral can range anywhere from $4,000 to $15,000, depending on whether you want a simple ceremony or a much more elaborate farewell.
Why do funerals cost so much? There are several expenses you need to budget for:
If you need help covering all these costs so you can give your loved-one a proper send-off, you might need a funeral loan.
A funeral loan is basically a personal loan, and you can use it to cover unexpected funeral expenses that you would otherwise be unable to afford. There are two types of funeral loans available:
Secured funeral loan. A secured personal loan allows you to borrow an amount ranging from a minimum of $2,000 up to a maximum of $100,000, with the flexibility to pay the money back over a term of up to seven years. You’ll need to offer an asset (or assets) as security for the loan, for example a car or the equity in your home, and there are fixed- and variable-rate options available.
fixed rate
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A low rate loan to finance new vehicles or cars up to two years old. Borrow up to $75,000.
Unsecured funeral loan. An unsecured personal loan does not require you to offer any assets as collateral before your financing will be approved. This represents an increased risk for the lender and these types of loans tend to attract higher interest rates and fees than secured finance. Loan amounts of up to $50,000 are available, and terms typically range from one to seven years.
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Get access to flexible repayment options and next-day funding with a Symple personal loan.
Before applying for a funeral loan, make sure to consider the following factors:
If you’re shopping around to find the right personal loan to help cover the cost of a funeral, remember to consider the following factors when weighing up the pros and cons of loans:
You’ll need to check that you’re eligible for a funeral loan before you apply. You will typically need to meet the following criteria:
You’ll also need to provide the following information when you apply for a loan:
Once you have submitted your application, the lender will assess it. Application times vary across lenders, but some are able to offer same-day financing if you need the funds urgently.
Picture: Shutterstock
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