Take it Easy! There is a Vacation Loan

01 Oct 2020

Wherever there is life, there are aspirations

Wherever there are aspirations, there are finance options.

Sunny beaches of Hawaii……..quaint valleys of Italy….or the busy streets of Paris…… if you have a travel aspiration, there is finance option also. Yes, make your dream vacation happen now with a travel loan. It is an unsecured form of personal loan that you may avail for your travel. 

It helps you to cover different travel-related expenses like hotel accommodation, travelling fare, food, buying travel accessories, money for travel insurance, and many others. And you can easily repay the loan in fixed instalments. 

Go for a vacation loan that comes at the low-interest rate and processing fees to minimize the costs. 

Here are some lenders that offer the travel or vacation loan-

1. Upstart

Upstart is a lending platform designed to improve access to affordable credit. It is a good option for those who have a short credit history and promising financial futures.

Key features:

  • The maximum loan amount is $1,000 - $50,000
  • Vacation loan from Upstart can be availed at the minimum credit score of 620.
  • The APR (Annual Percentage Rate) ranges from 5.59%- 35.99%. 
  • A borrower with a minimum annual income of $12,000 can apply for the loan.
  • The maximum debt-to-income ratio is 45%.
  • Upstart accepts the borrowers who are new to credit.
  • The flexible repayment tenure ranges from 3 years to 5 years.

2. Afinoz

Enjoy flexible EMI plans, higher loan amount and desired loan tenure options at Afinoz fintech market place. It is a good option for those who have a short credit history and promising financial futures.

  • A borrower will be able to avail the maximum loan amount up to $40,000.
  • The borrowers should have a minimum credit score of 640.
  • The APR (Annual Percentage Rate) will be 5.99%* onwards. 
  • Usually the debt-to-income ratio should be less than 30%.
  • A borrower should have a minimum credit history of 3 years. 
  • The flexible repayment tenure varies from 3 years to 5 years.

3. LendingClub

LendingClub brings the borrowers and investors together and helps people access to credit

  • The Lending Club offers a maximum loan amount of $1,000-$40,000.
  • The loan from Lending Club can be availed with a minimum credit score of 600.
  • The APR (Annual Percentage Rate) ranges from 6.95%- 35.89%. 
  • A borrower should have a minimum credit history of 3 years. 
  • The debt-to-income ratio is less than 40% for single applications and 35% for joint applicants.
  • The flexible repayment tenure ranges from 3 years to 5 years.

4. Best Egg

Best Egg provides personal loans to the borrowers who want to consolidate the debt and required instant cash.

  • Best Egg offers a maximum loan amount of $2,000 - $35,000.
  • The borrowers should have a minimum credit score of 640.
  • The APR (Annual Percentage Rate) ranges from 5.99%- 29.99%. 
  • There is no specific debt-to-income ratio, but in general it is less than 30%.
  • A borrower should have a minimum credit history of 3 years. 
  • The flexible repayment tenure ranges from 3 years to 5 years.

5. Rocket Loans

Rocket Loans’ funds offer high loan amount at a low rate of interest. The loan processing is fast and easy at Rocket Loans.

  • The maximum offered loan amount is $2,000 - $45,000
  • The loan from Rocket Loans can be availed with the minimum credit score of 640.
  • The APR (Annual Percentage Rate) ranges from 6.85%- 28.90%. 
  • A borrower should have a minimum credit history of 2 years. 
  • The debt-to-income ratio should be 40%.
  • A borrower with a minimum annual income of $ 24,000 can apply for the loan.
  • The flexible repayment tenure ranges from 3 years to 5 years.

6. Discover 

Discover is ideal for those who have an excellent credit score and is willing to consolidate the high-interest debt.

  • The maximum offered loan amount is $2,500-$35,000.
  • The loan can be availed at the minimum credit score of 660.
  • The APR (Annual Percentage Rate) ranges from 6.99%- 24.99%. 
  • A borrower should have a minimum credit history of 2 years. 
  • A borrower with a minimum gross income of $ 25,000 can apply for the loan.
  • The flexible repayment tenure ranges from 3 years to 7 years.

7.Marcus

Marcus loans are among the institutions that offer low-interest rates, no fees, and flexible loan repayment tenure. It also provides multiple payment options.

  • Marcus offers the maximum loan amount of $35,000-$40,000
  • The loan can be availed at the minimum credit score of 660.
  • The APR (Annual Percentage Rate) ranges from 6.99%- 28.99%. 
  • A borrower should have a valid U.S. bank account, Social Security number, or the tax ID.
  • The flexible repayment tenure ranges from 3 years to 6 years.

8. Earnest

Earnest can be a good option for those who are new to credit and responsible with money. It offers a high loan amount with low-interest rates and no fees.

  • The maximum offered loan amount is $5,000 - $75,000.
  • The loan can be availed at the minimum credit score of 680.
  • A borrower should have proof of the steady income.
  • The APR (Annual Percentage Rate) ranges from 5.99%- 17.24%. 
  • He/she must be a resident of Columbia District or a state other than Alabama, Delaware, Kentucky, Nevada or Rhode Island.
  • The maximum debt-to-income ratio is 45%.
  • The flexible repayment tenure ranges from 3 years to 5 years. 

Pros and cons of a vacation loan

Vacation can be a great solution to meet the travel expenses, but everything comes with certain advantages and limitations. So, here are the few pros and cons of the vacation loan.

Pros

  • It is mostly an unsecured form of a loan, so there is no need for collateral
  • It is usually easier to acquire than their counterparts if you have a decent credit history. 
  • The loan application process is much simpler, and you can apply with just a few clicks.
  • Taking a small vacation loan will be one way to meet the coverage on the trip. Take a wise decision and utilize only the loan amount for the trip.

Cons

Some agents may ask you to book your tickets through them, and they will help you avail a vacation loan. This may land you with a high-interest rate on a vacation loan, and they help you avail a loan. Try to steer clear of such loans.

  • Vacation loan comes at a high rate of interest in comparison to other loans because it is an unsecured loan.
  • Various credit cards may offer extended periods of interest-free borrowing as long as a specific percentage of the credit line is not exceeded. Vacation loan does not come with such a luxury.

Alternatives to vacation loans

Vacation loans may be marketed as an easy way to finance the travel, but it can be an expensive option, especially for applicants with low credit scores. Few alternatives are also suggested for a vacation loan. So, before taking a loan, have a look at these alternatives:

  • Savings: Plan the trip earlier at least a few months and start saving. The dedicated travel savings account can be a good option. Different travel sights offer discounts and charge less for flight tickets, hotel rooms, and car rentals. Search for such offers.
  • Travel credit cards: If you are a frequent traveller and have good credit, you may be eligible for a travel credit card. These kinds of credit cards come with many sign-up bonuses and other perks that could help in lowering the trip cost in the long run.
  • Credit card: If you have a good credit history, you may also qualify for a low-interest or 0% intro APR credit card. This may help you to carry a balance interest-free for over a year. It’s considerably a good option if you want to avoid paying interest in the short term.

 *Rate of APR will depend on case to case basis.