We all like to take a memorable holiday at least once in a lifetime. Be it going on a honeymoon or taking a world trip, travel puts our mind and body at ease. It’s not necessary that each one of us will have so much money saved up. And with exchange rates constantly fluctuating, we can’t really predict how much money we’ll need for our overseas trip. An easy way out here is to borrow. You can get a personal loan for holiday purpose.
What are Personal Loans for Holiday?
Personal loans are an unsecured type of loan. Individuals can take a personal loan for any purpose they want. They can use it in any way. There are no restrictions. A holiday loan is a loan that can sponsor the holiday you’ve been waiting to take. Though it’s generally better to use your own savings, every person may not have that kind of money saved up. And it’s perfectly alright.
Is it Worth Taking a Holiday Loan?
hings like a house or car. An intangibor tangibel rip without having to dip into your savings. It’r savings can be usedfic numbA personal loan does not require you to have an asset as collateral. So, even if the worst happens and you fail to make repayments, your home, car and jewellery will remain with you. These loans usually are of a fixed amount, have a fixed (and not variable) rate of interest and are borrowed for a specific number of years (which is short). A low rate holiday loan is an easy as well as convenient way to pay for your trip without having to dip into your savings. It’s wise to use your savings as a deposit for tangible things like a house or car.
Can I get a Personal Loan for Holiday Even If I have Bad Credit?
Yes. So many people are unable to take their loved ones on a holiday just because of a bad credit history. We understand that every UK citizen- irrespective of credit score- deserves a holiday. You’re trying to improve your credit history and we’re here to help. No more chasing behind high-street lenders who charge you high interest rates or turn down your application! We specialize in offering personal loans for bad credit. Don’t keep your loved ones and destination waiting. Just fill in our application form and get the loan approval within 24 hours. We don’t give so much importance to a credit check.
How Much Personal Loan Can I Borrow For My Holiday?
The amount of personal loan you want to borrow depends on how much your holiday is likely to cost. The following factors may affect how much amount of personal loans you’ll need to borrow for your holiday trip.
- Within the country or abroad:
If you plan to travel within the UK itself, you may want to borrow a small loan. However, if you plan to travel to a destination in a foreign country, how much you’ll want depends on things like the exchange rate, cost of hotel bookings, entertainment options, etc.
- Duration of your trip:
A three-day overseas trip may cost you less than a two-week trip. The longer you stay in a foreign country, the higher the amount of personal loan you’ll likely need.
- What you want to do there:
How much you’ll have to borrow as a personal loan for your holiday also depends on your itinerary. If you plan to stay at a five-star hotel, go sightseeing and participate in activities and sports that are expensive, you need a higher holiday loan. Instead, if you plan to stay with your relatives and just want to shop and see places, it’ll work out much cheaper.
- Number of travellers:
Generally, the lesser number of travellers need lesser the amount of a personal loan. You may find- after your calculations- that as a couple, you need a small holiday loan than if you were a family with five members.
The destination itself affects how much personal loan you may have to apply for. This varies in tune with the exchange rate of the country you’re travelling to. For example, a country where £100 can pay for your hotel bills and travelling to five tourist spots is cheaper than a country where you have to pay £200 as hotel charges.
- How much you can spare from your own savings:
You’ll likely to use up a few hundred pounds from your savings to reduce the amount of your debt. However, it’s better to borrow a large sum of money. As you borrow more, interest rates fall and your debt tends to get cheaper.
For example, you can borrow a sum between £7000 and £15,000 over four years at an interest rate of 3%.
What is APR?
The Annual Percentage Rate (Annual Percentage Rate) is the rate at which lenders are ready to give personal loans. This refers to the interest rate plus any fees and charges you may have to pay. Remember that this is the representative rate that only 51% of all successful applicants will get. It’s like a deal that only the lucky get. The rest 49% will be offered a rate a bit higher than the headline rate depending on risk-based pricing.
Risk-based pricing is the percentage of risk you pose to a lender. If you’re a person with a history of poorly managed finances, a lender will offer you a higher rate for an unsecured personal loan.
Is My Credit Score Important To Get A Holiday Personal Loan?
Yes. As personal loans are unsecured loans, the lender is likely to run a credit search on your file before any further communication with you. Once you apply for a personal loan for your holiday, a lender will see whether you have a good or bad credit score. This leaves a mark on your credit file and shows the next lender how many you’ve already applied to. If you apply to too many lenders at once, it shows that you’re desperate for credit and can further deteriorate your credit score.
Pros and Cons of Holiday Personal Loans
- Your payments are fixed, making it easier to budget
- You can spread the cost of your loan to reduce monthly repayments
- You can take a payment holiday at the start of the agreement
- There is no to little risk as they’re unsecured
- The application process is simple and fast
- If you have a bad credit history, you may be refused a loan
- Even if you get a loan, it may come only at a high interest rate
- The high APR may make you think twice
- You have to repay the loan even if the holiday is long over
- Savings are essentially free
- Debt means risk and if you don’t repay, your lender may take you to court
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