Funeral Loans. What is Funeral Financing?

Funeral Loans. What is Funeral Financing?

Kerry Vetter
by Kerry Vetter
Updated: May 11, 2022

Many Americans face financial difficulties nowadays, especially when something unexpected arises, like the funerals of a loved one. Even if it is a delicate topic, we will try to discover all about funeral financing and how to overcome financial problems and organize respectable funerals.

Table of Contents

How Much Does a Funeral Cost?
What to Do If You Can’t Afford a Funeral?
Can You Take a Loan Out for a Funeral?
What is Funeral Financing?
How Does a Funeral Loan Work?
What to Consider Before Taking Out Funeral Loans?
Do Funeral Homes Have Payment Plans?
How to Borrow Funeral Loans?
Funeral Loan Alternatives
Get Financial Help for Funeral Costs
Frequently Asked Questions

How Much Does a Funeral Cost?

funeral payment plans

In the US, the average cost for burial is $7,848. But if the cemetery requests volt for the coffin, it will cost $9,420. These amounts don’t include cemetery fees and needed decorations for the funeral ceremony.

Also, the average funeral cost of funeral services includes embalming the body, funeral ceremony, service car for body transportation from the house to the funeral home, or funeral ceremony hall. Note that you are not obligated to use all the services or complete all the steps.

The average funeral cost for cremation is $6,970. This amount includes the cremation fee and cremation urn if needed.

What to Do If You Can’t Afford a Funeral?

If you can’t afford to pay for such services, you can always have solutions to try. Here is the list of options you can use if you can cover the funeral expenses.

Discuss with the funeral home director. You can talk to the funeral home administrator to learn about the financial possibilities. Some specialized companies provide funeral payment plans, but we will talk about it later. Try to find an affordable solution to pay for all expenses.

Reduce certain services and steps. You are not bound to use all the services or complete all the steps of the funeral ceremony. So, think about the expenses you and your family members can avoid paying for them. Write them down and try to stick to the plan.

Borrow cash from friends. Surely, friends are always here to support you in these difficult times. Maybe they can make it financially and ease your suffering. Talk to close friends and ask for a needed amount to pay for funeral costs.

Take out a loan. If all the possibilities don’t work for you, apply for a funeral loan and forget about the financial aspects. Such personal loans with monthly payments are considered a perfect financial solution for people who can’t afford to pay for respectable funerals.

Can You Take a Loan Out for a Funeral?

Sure thing! American consumers can apply for funeral financing with no collateral and cover expenses related to the funeral ceremony, cemetery fees, and other costs. People in need can rely on direct lenders that provide loan products for unexpected situations like funerals. The minimum loan amount and the maximum sum will depend on your income and credit score. That is why not all applicants qualify for larger loan amounts.

Direct loan providers allow you to use the money you wish when paying for funerals. Compared to monthly payment funeral plans, you are free to order catering for funeral dinner or decorations. This flexibility will ease these difficult days and make you feel better.

What is Funeral Financing?

funeral financing

Funeral financing is a personal loan that helps you cover funeral expenses within one business day. Personal loans for funerals with fixed payments are endorsed by the National Funeral Directors Association. But to get this loan from banks or credit unions, you need to have a better-than-average credit score. As a personal loan is considered a significant financial product, it requires a good credit history.

The origination fee of such loans ranges from 2.9% to 8%. However, some of them don’t have origination fees at all. The average APR ranges between 6.12% and 35.99%. Some funeral loan amounts vary from $5,000 to $15,000, depending on the loan provider’s capital. Many online lenders don’t have prepayment fees. It is perfect for borrowers who want to pay the loan earlier.

John T. McQueen, the funeral director and owner of the Anderson McQueen Funeral Home in St Petersburg, Florida, says that funeral loans are worth taking only if you don’t have other payment options to solve this financial problem. But before taking it out, increase your credit score to get low-interest rates and acces to a more significant amount.

How Does a Funeral Loan Work?

Funeral loans work as simply as ordinary loan products. You apply online or in-store by submitting the loan application. Both parties sign the agreement if approved and agreed on terms and conditions. After 24 hours, you access your money and pay for funeral expenses.

The next step is paying for funeral costs and avoiding getting out of control of finances. Also, the repayment process is online. You repay the funeral debt with fixed monthly payments within 36 months. It is the maximum loan term you may request. The lender just withdraws the loan amount and its total cost from your bank account. You can pay back the loan before the established term. There are no prepayment penalties. You won’t get a prepayment penalty if you repay the loan early.

What to Consider Before Taking Out Funeral Loans?

Before considering and applying for funeral financing assistance, you should know several important things. To organize better the information, 1FirstCashAdvance made a list of pros and cons of burial loans. Check them below before you get such a financial product.

Pros of Personal Loans for Funeral Expenses

Funds are available within one business day. You don’t have to wait days or weeks to get financial help for such an event. Burial loans may reach your bank account within 24 hours after signing the loan agreement.

A loan may be a relief of financial burden for a short-term period. You’ll cover all the funeral costs with a burial loan and forget about financial aspects within three days.

You can pay over time. You borrow funds now for funeral expenses but repay them over time. You can choose a suitable loan term and stick to it until you pay back the total amount.

It doesn’t affect your FICO score. It is possible because lenders and funeral houses don’t.

Cons of Personal Loans for Funerals

Your credit score could not be not enough for a personal loan. Borrowers should have a good credit history and a fair FICO score to get funeral financial assistance with low-interest rates. A bad credit score will make you borrow loan products with a higher interest rate that can damage your monthly budget.

Extra financial stress. You may feel additional pressure on your budget on these difficult days. If you don’t have emergency savings, a loan can be the reason you’ll have financial difficulties next month.

Make you tied to all expenses. When paying a loan, you always have to control the expenses and count all the dollars you spent.

Long-term obligation for repayment. A long-term repayment term could make you feel that you lose considerable money because of the loan rates.

Do Funeral Homes Have Payment Plans?

Many funeral companies have payment plans for relatives of people who passed away. Funeral loan amounts range from $10,000 – $25,000, depending on the funeral needs. The fixed monthly payments are paid directly to the funeral companies. You can search “funeral homes with payment plans near me” on the Internet and see their offers and what payment plan you can afford.

Plus, people may have pre-paid funerals. It means they have paid a certain amount before they pass away. This fund is used by the funeral companies for covering burial or cremation expenses.

How to Borrow Funeral Loans?

To get funeral loans with a reasonable interest rate, you should know how to assess your chances. Here are some tips you must follow when borrowing funeral loans.

Make a list of priorities. Write down all the things that should be done before the funeral ceremony. Then prioritize them through a list. Then you’ll be able to handle the list more organized.

Get estimates for the funeral. The next step is estimating all the costs. It implies calling the funeral organizations and decoration companies and finding out their prices. Note all the figures and identify how manageable it is for your current budget.

Know your credit score. Learn about your credit score and past payment debt before borrowing personal loans for funerals with no collateral and high interest rate. If it is less-than-perfect, try improving and increasing your chances of getting a cheap personal loan for funerals.

Pre-approval for several lenders. Apply with many lenders; don’t stick to one lending company. Compared to federal banks, it will increase your chances of personal loan approval.

Make a comparison of terms and rates. And the last step is making a comparison of terms and rates. Choose the most reliable lender whose conditions fit your needs the best.

Funeral Loan Alternatives

loans for funeral

If funeral loans aren’t a suitable solution for you, try the alternatives we grabbed for you in the list below.

  • Use life insurance. Your valid insurance will ease your bills in the long term.
  • Establish emergency funeral funds. Put a few tens of dollars aside every month to have an emergency fund. It will serve you as a safety account for unplanned situations.
  • Use a low APR credit card. Talk to a bank representative that will provide you with a low or zero APR credit card. This personal loan product will help you access loan funds with low rates or zero charges.
  • Shop around for cheap funeral houses. There are different funeral houses for different financial situations. Shop around and find the affordable one.

Get Financial Help for Funeral Costs

Losing the loved one is a great shock from which you will not recover for a long time. However, you are powered to control the situation and handle the manageable aspects of such a loss. 1FirstCashAdvance is here to help you in these difficult times and connect you with a suitable lender for your needs. They are ready to provide you with suitable loan products for funerals. Just fill in our secure loan application form and get preapprovals from multiple loan providers in just a few minutes. Together we will overcome these difficult times.

Frequently Asked Questions

  1. How do I make a funeral with no money?

    American consumers may get financial assistance from SSA or funeral credit unions. This organization could only help you pay for a certain funeral debt if you qualify. You should provide complete information about your current financial situation to make it. Try burial loans or another funeral financing assistance if you don’t want to wait for the bank or SSA loan approval.

  2. How can I make money fast for a funeral?

    You can borrow a loan through our secure connecting service, use your credit card, or ask for money from your friends and relatives. Whatever you choose, make sure you handle all your financial problems. By the way, you won’t have to pay an origination fee with our lenders.

  3. Is a funeral loan a great option for me?

    It is an option only if you are financially educated enough to handle your current situation. An additional income or emergency savings could help you manage all the funeral expenses if you didn’t get a loan. Also, it is a reliable solution if you don’t have collateral to put for more significant loan amounts.

  4. Can I get a funeral loan with a bad credit score?

    Yes, but the funeral loan interest rates will be higher, and the borrowed amount could be slower than you need. The minimum loan amount of such a service could be $5,000, and the maximum amount will reach $15,000. So, before borrowing such a loan, consider increasing your credit score and improving your credit history. But you can apply for funeral cash loans for poor credit. Getting such a loan product won’t affect your credit score because the alternative lenders perform only soft credit checks. They don’t check your creditworthiness through major credit reporting companies (Transunion, Experian, and Equifax).

 

Kerry Vetter is a consumer finance expert and writer, who has been engaged in creating finance-related content for more than ten years. Her expertise is approved by obtaining a Bachelor of Science in Finance from Boston College, as well as receiving three major certificates as a professional advisor and counselor.  At the moment, Kerry is an author of multiple educational articles and insights that have been created in order to increase and develop financial literacy and responsible borrowing among US citizens. Her expert relevant savings advice has helped a lot of people overcome their financial issues and find out more about principles of smart spending, the right investment decisions, and budgeting.  You can read more about Kerry’s professional background here.

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