In South Africa there is no formal loans for funeral services or companies that offer this service, the closest you’d get is the ‘Ubuntu’ spirit of communities that come together to assist, if your family cannot. Instead of searching for loans for funeral, be prepared by having the right cover, but in case you find yourself in a mess, we look at ‘funeral service’ loans.
Emergency funeral loans
If you must take out a loan to pay for a funeral, you will have to ensure that you can qualify for a personal loan. This means, that you need to be a South African who has a good credit record (not under debt review, sequestrated or under administration), be employed with a minimum of R5 000 income and have a bank account at a minimum.
This might be a lot to ask for many South Africans, but if you do manage to qualify for a loan, you need to understand that the amount you manage to get, needs to be paid back and at a very high interest rate, which is compounded monthly. This will add great stress to your monthly budget, which is why it is not recommended to go this route.
You need to also understand the difference between secured and unsecured loans, which are your choices for loans for funeral expenses. A secured loan means that your car or home will be used as collateral, and if you do not pay, then your car or home could be taken to pay what you owe. Make sure that you understand what loan you are taking to pay for burial expenses.
Get the funeral cover you can afford today
Make sure that you help yourself and your family by making sure that you have some form of funeral cover, even if it is a small amount which you can get relatively cheaply through prepaid channels. This will prevent the need for funeral burial loans and unwanted stress that your loved ones will have to endure when the time comes.