Do you want to travel somewhere that you never thought you would be able to afford? Is your travel bucket list full of places to visit like Spain, Italy, or even somewhere like California to Disneyland?
It's still possible for you to visit even if your wallet says otherwise!
One way to accomplish this is by taking out a travel loan — also called a personal loan. How does this work? Read on to learn all about a personal travel loan and how you can get one too.
What is a Personal Loan?
A personal loan allows you to make a large purchase when you don't have the funds, and then you would pay the money back through a monthly fee.
You have different loan amounts to choose from, and each one will have a fixed interest rate and scheduled payment periods.
These are sometimes better options than using a credit card since credit cards typically have higher interest rates.
Because traveling and vacationing are not secured by collateral such as houses or cars, travel loans are considered personal loans.
How Long do Travel Loans Last?
A travel loan will usually last between 12 and 70 months. Sometimes they will last longer depending on what company you use to acquire one.
You get to choose how long it takes to pay the loan off — which if you have the money later to do so, make it a bigger payment so that you can pay the loan off quicker.
What are the Pros of Taking out a Loan?
- You could save money with a loan rather than a credit card
- If you make a late payment or a few, you won't be penalized and lose your collateral
- Loans usually have lower interest rates
- You get funds fast so that you can travel
What are the Cons of Taking Out a Loan?
- Your credit score will suffer if you can't repay the loan
- You might acquire more debt than you realize
- Paying interest on anything is not advisable
- Loans provide only short-lived funding that might result in some setbacks
Tips to Use Before Taking Out a Loan
Build your credit before you apply for a loan
This way, you will have a better credit score and more cushion so that if you struggle to pay the loan back, your credit won't be ruined in the long run.
Make sure you know exactly how much you want to borrow
How much can you afford? How much do you think you'll need for a trip to Spain? Factor in emergencies and unexpected expenses to be on the safe side.
Be sure you don't overcompensate either; otherwise, you will be paying the money back that you didn't use or never needed.
Compare loans and lenders before you make a final decision
Look at the APR (the Annual Percentage Rate) and extra fees that might be included in the loan process.
Review These Things As You Shop for a Loan
- Be aware of any fees or extra fees
- Know the time limit of your loan
- Review the APR, which is how much you'll pay for a loan, as well as the interest rate
How Long Does it Take to Get Approved for a Travel Loan?
It could take up to 7 business days to be approved for a loan, but, generally speaking, you will receive your loan between 5 and 7 business days. Immediate approval loans, or prestamos aprobacion inmediata, might be possible as well.
To receive immediate approval for a loan, try to prepare for the application process well. Keep a close watch on your credit and your budget to encourage lenders to approve your application fast.
Traveling to Spain, or anywhere for that matter, is not as far-fetched as it seems. You can be packing your bags and exploring the world sooner than you think by applying for a personal loan.
Don't hesitate to adventure; apply for your travel loan today. Vamos amigos — we'll see you soon!