Planning to borrow a personal loan for Holiday? Consider these 6 major elements before you take out a holiday loan.
Did you know that 3% of all personal loans taken out in the UK every year are personal loans for a holiday? Added up together, Brits take out an amazing £1,050,000,000 a year on no guarantor vacation loans – that’s over a billion pounds!
Holidays with friends and family provide, for many of us, is the highlight of the year together with Christmas time. However, with the Association of British Travel Agents (ABTA) finding that travellers spend an average of £532 before they’ve even set foot on a plane and Thomas Cook discovering that the average family of four spend £1,027 when they’re abroad, Holiday loans are proving to be far more popular than ever.
Even if you’re staying here in Blighty, it’s not cheap. While 45 million holidays abroad every year, 34 million of us “staycation” in our green and pleasant land.
Maximise your options: Compare and apply for loans below with LoanTube
Apply Filters
Loan Amount
£4000 -
£20000
Norwich Trust
Loan Term
1 -
10 years
4.8/5
Representative APR
31.90%
Minimum Age
21 Years
Representative Example: £12,000 over 66 months, 31.9% APR fixed. Monthly payment £358.22 Annual interest rate 28.01% fixed. Interest payable £11,642.52. Total repayable £23,642.52.
4.8/5
Norwich Trust
Loan Amount
£4000 -
£20000
Loan Term
1 -
10 years
Representative APR
31.90%
Minimum Age
21 Years
Minimum Income
£2000 per month
Representative Example: £12,000 over 66 months, 31.9% APR fixed. Monthly payment £358.22 Annual interest rate 28.01% fixed. Interest payable £11,642.52. Total repayable £23,642.52.
Loan Amount
£5000 -
£100000
Evolution Money Loans
Loan Term
1 -
20 years
4.5/5
Representative APR
28.96%
Minimum Age
18 years
Representative Example: Loan Amount: £20950.00, Loan Term: 85 Months, Interest Rate: 23.00% PA Variable. Monthly Repayments: £537.44. Total Amount Repayable: £45,682.15. This example includes a Product Fee of £2,095.00 (10% of the loan amount) and a Lending Fee of £714.00
4.5/5
Evolution Money Loans
Loan Amount
£5000 -
£100000
Loan Term
1 -
20 years
Representative APR
28.96%
Minimum Age
18 years
Minimum Income
Not mentioned
Representative Example: Loan Amount: £20950.00, Loan Term: 85 Months, Interest Rate: 23.00% PA Variable. Monthly Repayments: £537.44. Total Amount Repayable: £45,682.15. This example includes a Product Fee of £2,095.00 (10% of the loan amount) and a Lending Fee of £714.00
Loan Amount
£1000 -
£10000
1Plus1 Guarantor Loans
Loan Term
1 -
5 years
4.4/5
Representative APR
39.90%
Minimum Age
18 years
Representative Example: Borrowing £3000 over 36 months with a representative APR of 39.9% (variable),the amount payable would be £134.21 a month,with a total cost of credit of £1831.56 and a total amount payable of £4831.56.
4.4/5
1Plus1 Guarantor Loans
Loan Amount
£1000 -
£10000
Loan Term
1 -
5 years
Representative APR
39.90%
Minimum Age
18 years
Minimum Income
Not mentioned
Representative Example: Borrowing £3000 over 36 months with a representative APR of 39.9% (variable),the amount payable would be £134.21 a month,with a total cost of credit of £1831.56 and a total amount payable of £4831.56.
The six things that the LoanTube would urge you to consider before taking out a holiday loan are:
- are the repayments fixed?
- how expensive will your loan be?
- is saving better than borrowing?
- doing your due diligence on your loan terms and conditions
- meeting your repayments in full and on time
- your credit rating
Try to Find a Holiday Loan With a Fixed Monthly Repayment
- It’s always better to know exactly what’s ahead. That’s why it’s always better to choose a loan with a fixed monthly repayment. Most lenders now offer this, although there are some short-term lenders who offer a repayment schedule where your repayments are largest at the start and they decline in size with each payment.
Is It Better to Take Out a Loan Than Pay on Your Credit Card?
- If you have a credit card, you can always pay for your holiday via your credit card rather than taking out a personal holiday loan. With a credit card, you benefit from extra protection under the Consumer Credit Act.
- However, credit card interest rates are often (but not always) higher than interest rates on holiday loans. And you may not need that extra protection anyway if your holiday provider and/or your travel agent is a member of ATOL or ABTA.
Should You Save Up for Your Holiday Instead?
- It goes without saying that you should never borrow more than you need to borrow to pay for your holiday. The more you borrow, the more interest you payback. And, here at LoanTube, we’re on the borrower’s side and we see it as our primary duty to protect your interests and your savings.
- If possible, try and use that much amount from your savings that you can comfortably afford towards your holiday and then go for a holiday loan to fund the balance. You will always pay more interest on a loan than you’ll be paid by your savings account provider. So, while it may be nice to have as large a balance in your savings account as possible, if you don’t use some of your savings to pay for your holiday, you’ll be losing out financially.
Make Sure You Know All of the Charges Up Front
- It’s understandable – when we take out a loan, we always look at the interest rate we’ll be paying to get an idea of whether the offer we have is a good deal or not. However, interest rates are only half the story.
- If you fall behind on repayments on a loan, many lenders’ terms and conditions allow them to charge you extra fees – like default charges. Do thorough research before choosing a loan.
Where Will the Money Come From to Make Repayments?
- On the subject of paying back your loan, it’s always prudent to be absolutely certain of where the money is going to come from before you take out a holiday loan to make the repayments. If you are in any doubt about your ability to make all repayments in full and on time, please don’t apply for a holiday loan.
What Effect Will the Loan Have on Your Credit Rating?
- If you do make all of your repayments on time and in full, you may see that reflected in your credit rating which may improve once your holiday loan is settled. However, please do bear in mind that if you default on your loan and you’re unable to pay it back, you will find it very difficult to borrow money for up to 6 years after your default.
Get Help From the LoanTube Team
- Whether you have a great credit score or not so good credit score, LoanTube wants to help. We’re not a lender – we’re a loan comparison website and broker. What we do is match holidaymakers looking for a loan to the right lender. When you send us your application, we take all the details you send us and then we profile them against the criteria our lenders send us about the type of borrower they like to work with.
- This all happens in seconds, so you’ll know in a few minutes from now whether your application has been successful or not. If your application gets successful, we’ll show you a helpful loan together with all the vital information you need to make the right decision – information like repayment dates and amounts, total interest repayment, default fees, and so on.
- Please note that there’s no obligation to take any loan we find you and our service is completely free of charge.
To start your holiday loan application, please click here.
