A vacation loan is a personal installment loan that you can use to finance your vacation. Have you always wanted to go on a trip to Cuba or have fun with a week of relaxation in Spain, a city trip to Rome or Paris? Could travel financing help you realize your projects? Therefore, a vacation loan may have something for you!
How much can I borrow?
With a vacation loan, a bank or a credit specialist will lend you the money you need to take a vacation or finance your trip around the world. The amount borrowed is to be repaid within a predetermined period. The amount of a holiday loan generally varies between banks between USD 1,250 and USD 100,000. The duration of the loan is between minimum 6 months and maximum 120 months. On our loan comparator site, you can make a free loan simulation and see how much money you can borrow according to your needs and your financial situation.
As soon as the loan granted by the bank of your choice, you receive in your bank account the money borrowed entirely in your name. The personal vacation loan is a loan that requires no justification. From then on, you decide if you want to use this money to go skiing or to take a summer vacation in the sun, to go around the world, or for any other type of vacation. Then, you repay a fixed amount each month which includes part of the borrowed capital and the associated interest. The first due date for the refund is usually one month after the day you received the money in your account.
Do I have to submit a deposit?
No collateral is required to apply for and obtain a vacation loan. However, you must meet certain minimum conditions for obtaining a loan, which you can find in our loan guide.
How to go around the world without breaking the bank with a loan?
To finance your vacation, you can choose between a personal installment loan or a line of credit (also called cash reserve).
The installment loan
With an installment loan you benefit from a certain degree of security. Thus, the amount, duration and interest rate of the vacation loan are fixed. The interest rate (APR) is constant and therefore does not vary over time. You know from the start how much money and when to pay off your loan. The borrowed amount will be deposited in your bank account as soon as the loan is granted and you can then fully enjoy your vacation.
With a credit opening, a maximum spending limit is agreed from the start depending on the offer, your needs and your financial situation. Then you decide the duration of the refunds. However, keep in mind that with a credit opening, a minimum amount must be repaid every month.
The period over which you can borrow is also fixed by law. Both principal and interest are included in the reimbursement.
What are the advantages of each of these credits?
With a personal loan, you receive the amount of your loan from the start. Then you choose whether you prefer to spend that money on staying at a campsite or a hotel. The advantage of a personal loan is the clarity of the information you have on the loan. Indeed, you know in advance the fixed repayment deadlines as well as the amount of capital to be repaid with the associated interest. In addition, with a personal loan, the interest rate is generally lower than that of a credit opening, which is around 12.5%.
The opening of credit
The great advantage of a credit opening is that you always have money available which you can use for example in case of unforeseen expenses. As for example, during your vacation, it often happens that you go to a restaurant and that your vacation costs more than expected. In this case, an opening of credit can assure you that you still have money available. The amounts you have reimbursed will be reset to zero (zeroing principle), and a new credit opening will be available again. Therefore, the opening of credit is a very flexible form to have money available
Is It Reasonable To Take A Vacation Loan?
While financing your trip around the world with a loan may seem superfluous, that is nothing compared to an experience that you will remember for a lifetime. Travel financing via a loan should not be a problem, obviously under certain conditions. Indeed, the vacation loan is an attractive option because you can spread out all the costs of your vacation over time and also manage the reimbursements. With a holiday loan, there are also less formalities, so you can still benefit from this time saving to take a last-minute trip even if your salary does not arrive until a week later. But always keep in mind that borrowing money also costs money.
Another advantage of the vacation loan is that you do not run the risk of being left without money during your vacation. However it is not advisable to finance your vacation each year with this type of loan. A holiday loan remains a consumer loan that should be used in exceptional cases.
How can I find the best vacation loan?
The best way to find the best rate vacation loan is to compare all the vacation loans with each other. On our loan comparator site, you can make a free loan simulation and quickly find the cheapest loan.
It is important to know that not every bank offers a vacation loan. In addition, the vacation loan offered by banks that have one is not always cheaper than a personal loan. So it is always worth comparing vacation loans and personal loans. During your simulation, you can also vary the amount and duration of the desired loan in order to benefit from the most advantageous annual effective annual rate (APR) according to your needs and your financial capacity. No need to ask yourself how to go around the world without spending your savings: the financing of your trip can also be done via a holiday loan.