When a loved one passes away, it can be a shock in every way possible. Along with the grief and loss come a wide range of urgent end-of-life expenses. And, in some cases, there’s no money left behind to cover them. If you’re in charge of organizing the funeral, you could consider taking out a funeral loan to cover your expenses. This can give you some peace of mind while you mourn, and allow you to pay off the costs more comfortably over time.
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How do funeral loans work?
A funeral loan typically refers to an unsecured personal loan that a borrower uses to cover a loved one’s funeral expenses. When you take one out, the lender provides you with a lump sum upfront that you can use pretty much however you’d like. You can use it for various funeral costs, along with any ancillary expenses you’re encountering.
After receiving the loan, you’ll need to repay it, plus interest, through monthly payments over a fixed term. Most lenders offer repayment terms from one to seven years.
Your interest rate will depend on factors like the amount you wish to borrow, your credit score, your credit history, and your income. Lenders generally prefer a FICO score of 670 or above, and typically offer loan amounts from $600 to $200,000.
Additionally, some lenders charge an origination fee equal to a percentage of the loan amount. It often gets deducted from your loan amount before the funds are sent to you.
Aside from the interest rate, it’s also important to look at the annual percentage rate (APR), which includes the interest rate and fees. Most lenders typically advertise the APR.
Common personal loan rates and terms
Personal loan features vary widely depending on the lender and what you can qualify for:
- Loan amounts: $600 to $200,000
- APRs: 5.20% to 35.99%
- Origination fees: 0% to 12% of the loan amount
- Repayment terms: 1 to 7 years
Compare funeral loan rates
Advertiser DisclosureOverview
Lightstream is one of three Credible partner lenders to offer loan amounts up to $100,000, which makes it ideal for financing large expenses like home improvements or weddings. Funds are available as soon as the same day you apply, and you'll have up to 12 years to repay certain types of loans, including home improvement loans, RV loans, and boat loans. There are no origination fees, and rates are low — Lightstream's lowest APR beats SoFi's advertised lowest APR by 1 percentage point. But you'll need good credit to qualify.
Unlike most lenders, Lightstream does not let you prequalify on its site. Nor does it provide a contact phone number next to its customer service hours on its website.
Repayment terms
2 - 12 years, depending on loan purpose
Eligibility
Available in all states except RI and VT
Time to get funds
As soon as the next business day
Loan uses
Credit card refinancing, debt consolidation, home improvement, and other purposes
Read full reviewOverview
Upstart has one of the lowest available APRs of Credible partner lenders and of all non-partners we reviewed, making it a good choice for well-qualified applicants. However, it's also is one of few lenders that doesn't have a minimum credit score requirement (if you apply on the lender's website), which makes it an option if you have bad credit or no credit history. Upstart may charge an origination fee as high as 12%, but good-credit borrowers may not be charged one at all.
Trustpilot gives Upstart 4.9 stars, which is the highest of all lenders we reviewed.
Time to get funds
As soon as 1 to 3 business days
Loan uses
Pay off credit cards, consolidate debt, relocate, make a large purchase, and other purposes
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Discover Personal Loans offers low APRs, repayment terms up to seven years, no origination fees, nationwide availability, and doesn't require your Social Security number to prequalify on its site. You'll need to have an annual income of at least $40,000, and a FICO score 660 or higher, to be eligible. If your credit score is fair or poor, you'll need to go elsewhere, as Discover doesn't allow cosigners.
Funds are available as soon as the next business day after loan approval.
Eligibility
Available in all 50 states
Time to get funds
Funds can be sent as soon as the next business day after acceptance
Loan uses
Auto repair, credit card refinancing, debt consolidation, home remodel or repair, major purchase, medical expenses, taxes, vacation, and wedding
Read full reviewOverview
Upgrade has a suite of features that make it a very attractive lender: competitive interest rates, discounts for direct pay and autopay, as soon as same-day funding, up to seven-year repayment terms, and nationwide availability. Plus, loans are available to fair-credit borrowers, and you don't need to input your Social Security number to prequalify on the website. Upgrade even offers secured personal loans, which is not common among lenders.
However, Upgrade does charge an origination fee of 1.85% to 9.99%. You must have a FICO score of at least 600 and a minimum income of $25,000 annually to qualify.
Loan amount
$1,000 to $50,000 ($3,005 minimum in GA; $6,600 minimum in MA)
Loan uses
Credit card refinancing, debt consolidation, home improvement, major purchase, other
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LendingClub is a solid lender for good credit borrowers and some fair credit borrowers that apply directly on its website. It's easy to prequalify with LendingClub, especially if you're uncomfortable providing your Social Security number, as the company doesn't require it at the prequalification stage. (You will need to provide it if you move forward with a full application.)
While prequalification is not a guarantee that you'll be approved for a loan, LendingClub does a better job than most other Credible partner lenders at approving applicants that have successfully prequalified. In other words, you're less likely to have your application declined once you apply (if you've already prequalified). LendingClub may charge an origination fee between 3% and 8%.
Eligibility
Available in all 50 states
Loan uses
Debt consolidation, paying off credit cards
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SoFi stands out for offering no-fee personal loans with competitive rates, high loan amounts, long loan terms, discounts for autopay and direct pay, and funding as soon as the same day. Plus, SoFi prioritizes convenience for existing and potential customers with features like live chat and an easy prequalification process that doesn't require your Social Security number.
The main catch is that you need to qualify for a loan with SoFi, which can be hard to do if you don't have good credit. You also won't be able to apply with a cosigner, since SoFi doesn't accept cosigners; nor does it offer secured personal loans.
Fees
Option to pay an origination fee (up to 6%) in exchange for a lower rate
Time to get funds
Typically within a few days, given approval and bank account verification, but sometimes within the same day
Loan uses
Solely for personal, family, or household uses
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Best Egg is a solid lender for a wide range of borrowers and, notably, scored second for personal loan satisfaction in J.D. Power's Consumer Lending Study. It offers competitive rates, reasonable loan terms and amounts, and personal loans for fair credit. You'll need a FICO score of at least 600 to qualify, but the lower your score, the higher your APR may be. The APR includes the interest rate and origination fees, which range from 0.99% to 8.99% with Best Egg.
Note that if you successfully prequalify with Best Egg, you may be more likely to be approved for the loan relative to other lenders you prequalify with. Based on Credible data, borrowers who chose to apply for a loan with Best Egg were more than twice as likely to be approved (relative to most other Credible partners).
Fees
Origination fee, late fee, unsuccessful payment fee, check processing fee
Eligibility
Available in all states except DC, IA, VT, and WV
Time to get funds
As soon as 1 to 3 business days after successful verification
Loan uses
Credit card refinancing, debt consolidation, home improvement, and other purposes
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Avant personal loans are a good choice for borrowers with bad credit looking for small- to moderate-sized personal loans. Loans are available up to $35,000 and you could get the money as soon as the next business day after approval. Plus, Avant is more likely than some lenders to approve the applications of borrowers who've prequalified with Avant. However, the lender charges an origination fee up to 9.99%, and its top-range interest rates are among the highest of the lenders we reviewed.
Fees
Origination fee, late fee, dishonored payment fee
Eligibility
Available in all states except HI, IA, MA, ME, NY, VT, and WV
Time to get funds
As soon as the next business day (if approved by 4:30 p.m. CT on a weekday)
Loan uses
Debt consolidation, emergency expense, life event, home improvement, and other purposes
Repayment terms
1 to 5 years (2 to 5 years through Credible)
Read full reviewOverview
It’s worth considering a personal loan through Splash if you have good credit (ideally, a FICO score above 700). The platform offers loans from a wide range of lenders, and next-day funding is available. Plus, Splash has a live chat feature so you can get real-time answers without having to wait on hold or for an email. Loans are available up to $100,000 if you apply via Splash’s website.
Rates are competitive, but borrowers with excellent credit may find lower APRs elsewhere. If you need a repayment term longer than five years, you’ll need to look elsewhere as well.
Loan amount
$5,000 - $100,000 (up to $35,000 on Credible)
Eligibility
Available in all states except VT. OH and NM net disbursed amount must be greater than $5,000. MA must be greater than $6,000
Time to get funds
Same day available, typically 1-3 days
Loan uses
Debt consolidation, home improvement, medical expenses, major purchases
Read full reviewOverview
Universal Credit is one of a handful of lenders that offers personal loans for bad credit. If your FICO credit score is at least 560, you may be eligible for a Universal Credit personal loan. It offers loan amounts up to $50,000, repayment terms up to seven years, and discounts for direct pay and autopay. Funds are available as soon as the next business day after loan approval.
Note that rates and fees can be relatively high — you may pay an origination fee from 5.25% to 9.99%, and APRs start at 11.69%. If you get a loan with a high interest rate, consider refinancing your personal loan at a lower rate once you've improved your credit score.
Eligibility
A U.S. citizen or permanent resident; not available in DC, IA, SC, WV
Time to get funds
As soon as 1 business day after acceptance
Loan uses
Debt consolidation, pay off credit cards, home improvements, unexpected expenses, home and auto repairs, weddings, and other major purchases
Read full reviewOverview
Happy Money has been in operation since 2009 (formerly known as Payoff). It's an option for fair-credit borrowers (plus those with better credit), and notably has a relatively low top-end APR. In other words, you could qualify for a lower rate with Happy Money with fair credit, relative to other lenders that offer fair-credit loans. The company does charge an origination fee on some loans, up to 5%, but that's not as high as some other lenders' origination fees.
You should be prepared to wait a few days to get your money, as funding can take three to five days once approved. And loans aren't available in Massachusetts or Nevada. Happy Money has an A+ rating with the BBB and is ideal for debt consolidation and credit card consolidation loans.
Eligibility
Available in all states except MA, MS, NV, and OH
Time to get funds
As soon as 2 - 5 business days after verification
Loan uses
Debt consolidation and credit card consolidation only
Read full reviewOverview
BHG Money stands out for offering the largest loan amounts — up to $200,000 — of any Credible partner lenders. Simply put, if you need an unsecured personal loan over $100,000, there are very few places to look, but BHG is one. You'll have up to 10 years to repay the loan, but you'll need an annual income of at least $100,000 to qualify and a FICO score that's 660 or higher. However, if you have a cosigner that meets these requirements, BHG will consider your application.
Loan amounts start at $20,000, so look elsewhere for small loans. And BHG charges a modest origination fee between 2% and 4%, depending on your financial profile. Loan funds are available within three to 14 days of loan approval. Note that you can't prequalify with BHG.
Fees
Origination fees, late fees
Eligibility
Available in all states except Maryland and Illinois
Loan uses
Debt consolidation, baby (adoption), engagement ring financing, moving (relocation), business, home improvement, special occasion, cosmetic procedures, major purchase, taxes, credit card refinancing, medical expenses, vacation, wedding, other
Read full reviewFees
Origination Fee, $15 Late Fee, $25 NSF Fee
Eligibility
Available in all states except CO, CT, ME, NV, NH, TN, VT, WV, WY, and all U.S. Territories
Time to get funds
Funds typically deposited into your account in 1 business day13
Loan uses
Debt consolidation, credit card refinancing
Read full reviewOverview
OneMain Financial has multiple options for bad-credit personal loans. There is no minimum credit score required (if you apply directly with OneMain), which means you could get a loan with bad credit (FICO below 580). Plus, cosigners are allowed — a cosigner is someone (ideally, with good credit) who promises to repay the loan if you can't, which can make it easier to qualify or lower your rate. And, secured personal loans are available. You secure a loan with collateral, which may also help you qualify or lower your rate.
Rates are higher than competitors and OneMain charges origination fees as either a flat fee up to $500, or a percentage from 1% to 10% (depending on your state of residence). Note that even if you prequalify for a personal loan with OneMain, getting approved isn't a given.
Fees
Origination fee, unsuccessful payment fee, late fee
Eligibility
Must have photo I.D. issued by U.S. federal, state or local government
Time to get funds
As soon as 1 to 2 days after acceptance
Loan use
All except business, and education
Read full reviewHow much does a funeral loan cost?
The median cost of a funeral with a viewing and a burial was $7,848 in 2021, according to the latest available data from the National Funeral Directors Association (NFDA). This includes:
- The mandatory basic services fee: $2,300
- Embalming: $775
- Other body preparations: $275
- Removal and transfer of remains: $350
- Use of staff and facilities for viewing: $450
- Use of staff and facilities for the funeral ceremony: $515
- Hearse: $350
- Service van/car: $150
- Basic memorial package with printed materials: $183
- Metal burial casket: $2,500
Note: A vault is not included, and adds a median cost of $1,572.
If you decided to opt for a funeral with a viewing and cremation, it was a little less expensive, at a median of $6,970.
Keep in mind
While the NFDA reported in 2021 that the rise in funeral costs was not keeping pace with the general rate of inflation, after recent record-breaking spikes in consumer prices, the costs above are likely even higher for 2023.
Check Out: How Much of a Personal Loan Can I Get?
Pros and cons of a funeral loan
Taking out a personal loan to cover a funeral comes with both pros and cons. On the upside, if you’re in a situation where you don’t have the funds to cover a loved one’s end-of-life expenses, one can help you take care of them right away. You can often apply, get approved, and have the funds in your bank account within one or two business days. There are also many providers of personal loans on the market, so the odds of finding a loan that can work for your budget are pretty good.
On the downside, personal loans come with costs. You’ll have to pay interest and possibly fees to borrow. Further, if your credit is less than good, the APRs can be on the high end. It’s important to ensure that the monthly payments and overall costs will work for you long term. Personal loans also aren’t available to everyone. They are typically unsecured, so qualifying depends on your credit and income. If either falls short of the eligibility requirements, you may be denied or not able to get a loan large enough to cover the funeral expenses.
Pros
- Get funds fast to cover funeral expenses
- Pay them back over several years through affordable payments
- Many lenders to choose from
- Costs can be low if you have good credit
Cons
- Comes with interest charges
- Origination fees may apply
- Not all borrowers will qualify
- Costs can be high if you have bad credit
See Also: Where Can I Get a Personal Loan?
Funeral loan alternatives
What options do you have besides a personal loan? Here are a few alternatives:
- Life insurance policy: If your loved one had a life insurance policy, this could cover your funeral expenses. Life insurance policies pay beneficiaries named in the policy with a lump sum of cash or in periodic payments. Contact the insurance company immediately to understand the timeline and your options for receiving funds. If you need to take out a funeral loan because funds will be delayed, you could potentially pay it off with the life insurance money.
- Low-APR credit card: If you’re not sure about taking out a funeral loan, a low-APR credit card could be a better option. You can often find credit cards that offer 0% introductory APRs, which means no interest will accrue on purchases for a certain period of time. However, keep in mind that once the promotional rate expires, the standard APR will resume, and you’ll be responsible for any interest that accrues on the existing balance.
- Crowdfund: Instead of taking on debt and covering all the costs yourself, you can launch a crowdfunding campaign on a site like GoFundMe and request donations from friends and family. Even if it doesn’t cover all of the costs, it can help to reduce the amount you need to borrow.
- Home equity loan or HELOC: If you’re having trouble getting an unsecured loan but are a homeowner, you may have better luck with a home equity loan or line of credit. While they come with costly fees in some cases, they offer a way to get a large loan with a low APR. However, these are secured by your home, and if you default, you could lose it.
- Contact the funeral home: You can also contact several funeral homes in your area to compare costs and ask about payment plans. They may be willing to offer discounts or split your expenses up over time.
Tip
Along with the above suggestions, check if the deceased was entitled to any benefits. For example, eligible U.S. veterans, their spouses, and their dependent children are offered burial benefits, and many employers provide survivor benefits.
How to apply for a funeral loan
The first step in applying for a personal loan is to find out if you prequalify. When you prequalify, there’s no impact on your credit score, and you will receive quotes from lenders likely to approve you if you meet their qualifications. However, prequalification is not an offer of credit, and the final rate you receive may be different than what you were quoted.
- Make a list of your priorities: Before comparison shopping, consider your priorities for your loved one’s funeral. Are you looking for a type of casket or headstone? What about the location? Is it near so you can visit? Once you know what you’re looking for, it can help you narrow down your expenses and find the loan that’s right for you.
- Get several funeral cost estimates: Get quotes from a few different funeral homes before comparison shopping for a lender. The services that funeral facilities offer can vary in pricing.
- Know your credit score: Check your credit score so you can correct any errors that could be impacting your credit and your ability to qualify for a lower APR.
- Get prequalified with several lenders: When you prequalify, lenders perform a soft credit check that doesn’t hurt your credit score. Then, you’ll receive quotes that include the loan amounts, APRs, and terms you could be approved for.
- Review your lender options: Compare the APRs, loan amounts, and terms, as well as funding times and lender reputations. You can often find customer reviews on sites like the Better Business Bureau (BBB).
- Apply for the loan and get your funds: If you receive a loan quote that looks good, submit a formal application. The process typically involves verifying your identity and income, along with a hard credit check that will lower your score by a few points temporarily. If your application is approved, you’ll sign the loan contract and the lender will send the funds to your bank account.
Funeral loan FAQ
What if I can’t afford a funeral?
If you can’t afford the funeral of a loved one, look into ways to reduce the costs and explore different ways to cover them. For example, you can contact various funeral homes, compare the offerings, and ask about payment plan options. You can also consider a direct burial or cremation. Once the costs are minimized, consider running a crowdfunding campaign to get financial support from friends and family, or you could take out a loan to split up the costs over time.
Where can I get a funeral loan?
You may be able to find a personal loan that you can use to cover funeral expenses from banks, credit unions, fintech lenders, and other financial services companies. If you need a funeral loan with bad credit, consider applying with a cosigner or with a co-borrower, or asking a family member to help cover funeral costs.
Can you get a funeral loan with bad credit?
While it will be more difficult to get a funeral loan with bad credit, it may still be possible. There are several providers of personal loans that specialize in helping clients with fair to bad credit. It’s worth checking to see if you prequalify. You may also consider lenders that let you apply with a cosigner or offer secured personal loans.
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Meet the expert:
Jessica Walrack
Jessica Walrack is a freelance finance writer and journalist with over a decade of experience. During that time, she’s written hundreds of articles about loans, insurance, banking, mortgages, credit cards, budgeting, and taxes for well-known publications including CBS News MoneyWatch, USA Today, US News and World, Investopedia, and The Balance Money.