Funeral FinancingWhat is a Funeral Loan?

December 31, 2019Obitia

Obitia, LLC is a participant in the Amazon Services LLC Associates Program, an Affiliate Advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to Obitia is supported by its users. When you buy through links on our site, we may earn an affiliate commission. Learn more.


The average cost of a funeral can vary from $4,000 to $9,000 depending on what geographic area of the United States you live in and the type of funeral that is held.

For many families, especially if the passing of a loved one was unexpected, the sudden, and unplanned cost of a funeral can be a huge financial burden.

While there are many ways to finance a funeral or other end-of-life plans (e.g., life insurance, funeral insurance, the estate, donations, and government benefits), another method that families may want to consider is a funeral loan. These loans are also sometimes referred to as burial loans. It is recommended that a loan should only be considered if you are unable to find the funds to pay for the funeral and last expenses elsewhere.


What is a Funeral Loan?

A funeral loan is a type of personal loan, except that its primary purpose is to pay for funeral expenses. The loan can be obtained from many different institutions, as long as they lend for personal reasons. It may be best to look into multiple financial institutions, banks, bank credit unions, as well as online loan providers and lending services, for the best terms and interest rates.

You may also want to speak with the funeral director to ask if they offer a payment plan (instead of taking out a loan) or if they offer loan services themselves.

Once you receive your funds you can use it to pay the funeral home or any other ancillary product and service providers. You can also simply pay off any expenses incurred on your credit cards if you have already paid for services or products related to the funeral.


Pros of a Funeral Loan

· Fast Payout – The loan amount can generally be obtained in less than a week.
· Keep your Savings, Investments, Retirement Accounts – By taking out a loan you will not have to tap savings or investments to pay for funeral costs.
· Flexible – A funeral loan is technically a personal loan, so you will not be restricted by the type of expenses for which you may use the loan.
· Lower Interest than Credit Cards – If credit must be used to pay funeral expenses than a personal loan will most likely carry a smaller interest rate than credit cards.


Cons of a Funeral Loan

· Interest Charged – As with all loans, interest will be charged on the loan amount, and payments of principal and interest will have to be made until the loan is paid off.
· Responsibility – If you are the one taking out the loan then you are responsible for repaying it. Keep this in mind if it is not clear who is financially responsible for the funeral.


How much will I need to take out?

As mentioned above, funerals can vary greatly in price. Before you take out a loan you may want to use our average funeral pricing tool to estimate the amount a funeral will cost or contact a funeral home to get an estimate.
· Cost calculated by Obitia funeral pricing tool
· If there will be a traditional burial:

Because the cost can vary so greatly, it may be best to pay for the funeral using a credit card and then take out the loan after the fact to pay off the funeral expenses you put on the credit card (which will have a higher interest rate). This strategy can be complicated by the timing of the expenses.


How do I obtain a funeral loan?

Like any other type of loan, you will need to go to either a bank, financial institution or online lending company. Some banks and online lenders do not explicitly have a funeral loan as an option but do offer personal loans that will accomplish the goal of paying funeral expenses.

Most companies will require you to input basic information, including your full name, income, address, other contact information, and social security number so they can check whether you have good credit or bad credit. The process for denying or approving you may take several business days (usually one to three business days), so if you do not hear anything right away, that is okay.

Once the lending company has made you an offer you should carefully read the loan terms. While the total amount of the loan, the monthly payment amount, the interest rate, and the term (the amount of time and payments to pay off the loan) are generally considered the most important aspects of the loan you should consider other terms. For example, can you pay off the loan early or will there be a penalty if you do so? Is the interest rate fixed or variable? What happens if you are late with a payment or miss a payment.

Once you have agreed to the loan terms you should receive your loan money into your bank account and be able to start using it to pay for funeral costs (of pay off credit cards if you have already paid for the funeral).



A funeral loan is one of many ways to pay for a loved one’s funeral. They are generally used when there is an unexpected death and no other financial resources to pay for your loved one’s funeral expenses or you do not want to tap investments or retirement accounts. Benefits and donations may be available to pay for a funeral or even a portion of the funeral. Using a mix of financial resources to pay will make the amount of the loan needed smaller. Like any other type of loan, it is a good idea to explore other options first before relying on credit.

The information provided on this website does not, and is not intended to, constitute legal, accounting or tax advice; instead, all information, content, and materials available on this site are for general informational purposes only.


The information provided on this website does not, and is not intended to, constitute legal, accounting or tax advice; instead, all information, content, and materials available on this site are for general informational purposes only.




Your personal data will be handled in accordance with our [Privacy_Policy].

Already have account?

Lost Password

Please enter your username or email address. You will receive a link to create a new password via email.