What is a vacation loan?
A vacation loan is a short-term loan from lenders such as commercial banks or credit unions. Vacation loans are not payday loans or cash advance loans that have high-interest rates.
How do holiday loans work?
Holiday loans can be used for anything from vacations, as a gift for vacations, to ease stress over the holiday season, and even for student tuition fees.
To consider (negative points/ risks)
- These loans may have a higher interest rate than a secured loan.
- Can increase the cost of the overall holiday due to the interest charges.
- Applying for a few different loans, if not accepted by the first, will have a negative impact on your credit score.
- Could make the holiday season a lot less stressful by spreading the cost.
- These loans tend to be lower in APR than credit cards with a fixed interest rate and term.
- It won’t drain your savings.