When you need to borrow a fixed amount for a specific purpose, for example to pay for a holiday, an unsecured personal loan may well be the way forward. Whether you’re planning the trip of a lifetime or planning a big family reunion – and your finances won’t stretch to cover it – a personal loan means you needn’t miss out.
Holiday loans you can repay by next pay day
Taking out a loan to cover the costs of a holiday makes far more sense than using the credit card, which, unless you pay it off right away, will leave you with expensive interest rates and charges.
There are various types of holiday loans to select from including payday loans, where you can often get the money sent to you right away. So long as you pay off the loan by your next payday, you won’t incur charges on top of those you sign up for. While rates tend to be high, they can help out if you simply have to get to that family reunion. This type of loan may suit you if you have a bad credit rating, since payday loan lenders are more interested in whether you have the means to pay back the money rather than your history. You can also often apply for these types of loans online, and can get approval in minutes and money in the bank instantaneously. This is great if you need to book that flight right away to get a great deal.
Get an unsecured loan over a fixed term
If you’re happy to pay back the loan over a longer term, then depending on the amount of money you wish to borrow, you could opt for an unsecured loan. Lenders do not usually put restrictions on what you want to use the loan amount for, so if you have anything left at the end of your trip – you could put it towards other necessities. The good thing about taking out an unsecured loan to pay for your holiday is that you don’t have to put any of your assets up as collateral. You can usually borrow anything from $1000 to $25000 over a set period of time, ranging from one to five years. This means you can tailor the amount of money you borrow to fit your income.
There are many unsecured loan lenders on the market, each offering different lending criteria and interest rates. You will generally be able to borrow larger amounts of money at a reduced rate compared with smaller loan amounts. If your credit history is good you will likely be eligible for the best rates on unsecured loans. A fixed rate loan is a recommended type of personal unsecured loan, and is where the loan amount and total interest payable is divided up evenly over the loan’s duration. This is a practical solution since it enables you to plan ahead realistically, and know how much you will have to pay back each month.
Make sure your loan covers the entire trip
When you’re deciding on the amount to borrow for your holiday loan, include everything from air travel, accommodation and food to travel insurance and transfers. Then you won’t go short but will have all your expenses under the same umbrella. Online calculators will help you work out what you can afford and how long it will take you to pay the loan back.