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What are Holiday Loans - Everything You need to Know

What are Holiday Loans - Everything You need to Know

Although using credit cards and other lines of credit is also an option, their interest rates can sometimes be higher. So, if you are budgeting for those special times, take note that credit cards can be quite expensive.

Holiday season is the time to escape the everyday bustle of life, relax, and put all the stress at bay. Holiday loans exist as a source of finance for your dream vacation. These loans provide a great opportunity for those who dream of jetting off on their much- deserved getaway without having to worry about financial burdens.

But what are holiday loans? Continue reading to learn how they can help during the holiday season.

What's a Holiday Loan?

This is a type of personal loan that is unsecured and can be used to finance holiday expenses as well as other cash shortfalls. Whether it's gifts or parties, holiday loans can cover everything. A holiday loan of up to 2 lakhs can be obtained with an interest rate as low as 3% monthly. The good news is that your loan will be approved immediately and you will receive your funds within a day.

So, if you struggle financially during the holiday season, a quick and convenient solution is a holiday loan. This is a festive-focused financial boost to bridge any cash gaps and cover all the fun of your chosen trip. Don't let a lack of funds put an end to fulfilling those precious vacation dreams - grab yourself a special holiday loan from lendingplate so you can explore tomorrow.

Planning a vacation doesn't have to be stressful; with holiday loans, you can take your dream getaway and relax in style! Whether it's chilling at a resort or embarking on a thrilling safari, make your escape possible by getting the loan that fits. Just apply and get ready to pack those bags for the vacation.

But holiday loans aren't the same as other personal loans. They only become available seasonally. This implies that you can't take a holiday loan, let's say, in May. Moreover, holiday loans have low limits as compared to other personal loans. Another thing is that a holiday loan may have a short repayment period.

You may also read this: Apply for special occasion loan

How Holiday Loans Work

Holiday loans are a popular lending option for individuals looking to access funds and repay them in manageable installments. Like most personal loans, holiday loans are installment loans where you repay a set amount until they are repaid in full. Many online lenders offer holiday loans; however, they are only available at the end of the year, providing an ideal opportunity to equip your wallet before the festivities begin!

Ready to go on your dream vacation? Get the funds you need with a holiday loan from lendingplate. With interest rates of 3% per month, repayment terms of up to one year, and a loan ranging from ₹10,000 - 200,000, you are sure to have an unforgettable holiday time and, at the same time, be able to pay the amount without incurring additional fees. Of course, these terms vary from one lender to another.

What are the Requirements to Secure a Holiday Loan

If you're dreaming of a holiday getaway, then be sure to check the requirements for securing a loan. From current employment information and credit history to income, making your trip happen could involve several key steps.

Therefore, understanding these requirements beforehand is important. Knowing what documents are needed before starting your application will make the process much smoother. Below are some of the requirements needed to get approved for holiday loans:

  • An income of at least ₹20,000 each month - Before taking out a loan, the lender has to ascertain your financial capability. You should be getting a regular monthly salary of at least ₹20,000 per month, which shows that you can pay back the borrowed amount.
  • A credit score of over 670 - If your credit score is over 670, you may be eligible to take out a loan for that special holiday but to get more favorable terms, it's advisable to have a credit score of 720.
  • Be 21 years and above - You must be 21 years of age and above to get the loan.
  • You should be an Indian citizen.

Lenders use multiple methods to assess whether or not you are an ideal borrower for the loan. Factors such as your credit score, age, and income level will all be considered when assessing your loan eligibility. You'll need to satisfy all the criteria to be eligible. Besides, your credit profile should reflect responsible financial management strategies paired with solid earnings potential.

What are the Features of Holiday Loans Worth Checking Out?

For those looking for help dealing with holiday expenses, a holiday loan can be the perfect solution. Explore these features to see how they can help you manage your seasonal expenses:

They have a fixed rate - Holiday loans come at a fixed interest rate that's better than credit cards. Therefore, you can calculate the repayment installments without worrying about market fluctuations impacting the interest.

No collateral or guarantor needed to secure the loan - When you take out a secured personal loan, your lender requires something of value as collateral. This can range from real estate or vehicles for home and auto loans, respectively. If payments are missed or defaults occur, the creditor has the right to pledge assets to regain their investment. Besides, you should have a guarantor too.

But, no collateral and guarantor is needed for unsecured loans like holiday loans. When you fail to pay the loan at an agreed-upon time, you will be charged late payment fees, which will affect your credit score in the long run.

Instant access to your loan after approval - You can apply for the holiday loan online and get approved instantly.

You can get a loan even with a bad credit history - If a poor credit history stands in the way of achieving your dream vacation, fear not. There are lenders offering holiday loans even if you have bad credit. Similar to personal loans for bad credit, holiday loans provide an opportunity to make all your getaway fantasies come true, no matter your financial standing.

When to Take a Holiday Loan

Holiday loans are specifically designed for the holiday season and are not offered year- round like other loans. For instance, certain lenders make their offers available around Halloween and close them before the new year.

With holiday shopping likely to occur in November, you should consider obtaining a holiday loan as early as late October. Furthermore, if you've already splurged on shopping for the holidays, taking out a holiday loan to pay off your credit card debt and avoid high-interest rates is beneficial. This way, all your holiday debts can be consolidated into one monthly payment with lower interest than what you would have paid by charging them onto credit cards.

You may also read this: Debt consolidation loans

If you're struggling to cover holiday expenses, a holiday loan could come in handy. Consider taking out one if:

If You Can Pay Back the Loan

If you're thinking about taking out a loan for a holiday, it's important to consider your ability to pay back what you borrow. A lender will likely examine your debt-to-income ratio when reviewing your application, but make sure you have an extra monthly payment within your reach. If not - this option is not for you because you can land in huge debts, making it hard to recover.

You Have a Good Credit Score

With an impressive credit score, you can take advantage of the best interest rates. Conversely, if your credit history isn't good, the rate will likely be high, leaving you to pay a much higher price when repaying the loan.

When You Wish to Consolidate a Loan

If you want to minimize the interest charged on your holiday purchases, a personal loan can be an ideal solution. Consider comparing different loan options to see if there's a much more attractive rate available. You could stand to save money. After securing the funds, use them to pay off the debts and focus on paying back the loan later.

Benefits of Getting a Holiday Loan

Holiday loans are a convenient and easy way of getting funds for travel or special occasions. Of course, you must pay back these loans in full and on time. If managed correctly, they could help improve your credit score. Here are some of the benefits you'll get when taking out a holiday loan:

  • You borrow what you require - Holiday loans are typically lower, making it easier to borrow what's needed and avoid paying interest on a large loan.
  • Low rates - Holiday loan interest rates are usually lower than traditional unsecured personal loans, meaning you could save money in the long run.
  • Short terms - With almost all holiday loan repayment terms lasting a year, many lenders don't even apply prepayment penalties; this allows you to repay your loan earlier than anticipated without worrying about additional charges.

Are Holiday Loans a Sensible Financial Decision?

It is always wise to approach debt with caution. That said, if you're looking for a way to finance your holiday, it's good to have some cash on hand.

When you're looking for a lender, tread carefully. Being mindful and aware of potential risks is always a wise precaution. If your goal is to finance a vacation or have fun during the holiday season, you should know how much money you need for this and whether you are eligible or not.

If you're looking for a loan, be wary of some lenders who claim to provide cash without a credit check. These loans may seem like an easy fix, but the truth is that they usually come with exorbitant interest rates and hidden fees. On the other hand, using your credit card to finance your holiday purchases can also hurt your credit score while racking up hefty interest charges in no time.

lendingplate provides unsecured holiday loans with minimal to no fees. Furthermore, they are generally equipped with lower interest rates than other financing options, making your holiday expenditures more manageable in the long run.

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