Until a few days ago you thought not to go on vacation, but now you have changed your mind since you have found a super last minute offer! However, you do not have the necessary liquidity to pay for the trip. Don’t panic: why not take advantage of fast personal holiday loans?
Holiday Loan: the main features
By choosing a holiday loan it is possible to obtain a sum of money that covers up to 100% of the cost of the trip, also because the sum requested is usually less than 10,000 USD, but can go up to about 30,000 USD.
Usually the investigation and disbursement times are very fast. The loan can have a duration ranging from 12 to 60 months and requires a fixed rate repayment and constant installments.
Types of financing for holidays
To finance a trip there are various types of loans, including:
- personal loans, consumer credit financing requested from a bank or a financial company;
- the finalized loan, the result of the agreement between the finance company and the tour operator. The customer can pay the loan to the finance company in periodic installments. In this case, the applicant will have as reference point the online platform or the travel agency linked to the tour operator that sells the holiday package;
- the deferment of the payment, proposed by some agencies, which allow the payment of the trip in installments without interest, even if the time for settling the account is limited.
The elements of the holiday loan contract
The law states that a vacation loan contract must contain some very specific elements, such as:
- the interest rate;
- any price and conditions applied;
- the amount and methods of financing;
- the number, amounts and due dates of the individual installments;
- the APR;
- the detail of the analytical conditions for which the APR can be modified;
- the amount and reason for the charges that are excluded from the calculation of the APR;
- any guarantees required;
- insurance coverage required and not included in the APR calculation.
The evaluation criteria for the holiday loan
- risk policies, each bank applies its own risk policy in the evaluation of applications, based on the statistical data it possesses and which constitute the tool that allows it to control insolvencies;
- income level, acceptance of applications is subject to evaluation of the customer’s income level and the relationship between the latter and the repayment installment;
- creditworthiness of the applicant. Institutes estimate the level of risk linked to each application, also on the basis of the indications transmitted by the Risk Centers. If the applicant’s credit history shows some delays in the repayments of previous loans, the probability that the request will be accepted is less.
Holiday Loan: useful tips
- attention to the offers: better to take time and collect more information, make more comparisons and know the cost of the installments;
- keep an eye on the promotional installments since, even if the zero rate is advertised, this often only applies to certain periods and for a reduced duration;
- reduce the risk of over – indebtedness, so it is better never to exceed 30% of the monthly income with the sum of the installments.