You are probably excited if you plan on getting married this year. You’re going to take the plunge with the person you love, and then you can start a magical new life together. Perhaps you’re daydreaming about all that the future might hold for you, such as children, a house, and the building of a rich tapestry of shared experiences.

You’ll no doubt want an engagement ring that lets the world and your significant other know how you feel. If you do not have all the money necessary to buy your dream ring right now, though, you might consider financing an engagement ring. Many individuals do it.

Let’s talk about what financing an engagement ring looks like.

What Does Financing a Ring Involve?

Financing a ring is much like financing just about anything else. You pay the jeweler as much money as you can, and you pay off the rest of the cost in installments. If you have a steady job and at least decent credit, you can probably pay off the rest of the ring in a few months, provided you live frugally and don’t spend much on nonessentials.

You can also pay for the ring all at once by getting a bank or credit union loan. These lending entities will look at your credit rating, and you should also make it clear that you have a steady job. That is your means of paying back the loan.

You must pay back your creditor if you borrow cash from a credit union or bank to pay for the ring. You also need to pay interest on the loan until you’ve paid off the rest.

If you go this route, make sure you find a personal loan with the lowest possible interest rate. If you have excellent credit, you might get one as low as 8% or less.

Getting a Ring with Less-than-Great Credit

If you don’t have phenomenal credit and still want to get a loan from a credit union or bank, you might agree to take a loan with a higher interest rate. That rate might be 14% or less.

You can even get loans with only fair credit, but if you do, you might pay as much as 18% interest or even higher. If you start to get into that territory, it’s probably best to look for a less expensive ring. You should avoid interest rates that high unless you feel you have no other choice.  

Leveraging Something Valuable to Get a Loan

You have one more option if you want to finance an engagement ring. To get the money for the loan, you might leverage something valuable that you own, like a car or house. These kinds of loans are called secured loans.

Doing this is your best bet if you don’t have very good credit, but exercise caution with this option. The lending entity will place a lien on your house, car, or whatever else you leveraged until you pay back the money.

You Have Financing Options for Engagement Rings

If you’re set on getting a particular engagement ring, you have options that will let you do that, even if you don’t have enough money to buy it outright. You can put some cash down and set up a payment plan with the jeweler. You can also ask a lending entity for the rest of the money.

If you do that, make sure you have a job or other means of paying back the loan. You’ll get a low-interest rate if you have great credit and a higher one if your credit is only fair. You can also use something valuable that you own to get a secured loan, but take care, as the lending entity will place a lien on your property.  

Look at the available options and decide which is best for you.

Written by: Carolina D’Arbelles