Planning a holiday? Check out February's top personal loans

It seems the travel bug is going ‘round. If you’ve got summertime aspirations to fly across the country or perhaps further afield to Bali or Fiji, you might consider a personal loan to help pay for your upcoming trip.

The latest lending indicators from the Australian Bureau of Statistics (ABS) revealed that the value of new loan commitments for fixed term personal finance fell a further 2.8 per cent in December, following a decline of 2.4 per cent in November.

Commitments for personal lending were dragged down by a drop in lending for road vehicles, down 1.6 per cent month-on-month. However, new loan commitments for travel and holidays were up 11.2 per cent. Additionally, loans for household goods rose 0.8 per cent to an all-time high.

Finance your vacation with a holiday loan

Sometimes called a travel loan, a holiday loan is simply a personal loan you can use to help pay for your trip. This type of loan can offer convenience to travellers wanting to pay for flights, accommodation, insurance and other travel expenses, without having to spend time and effort saving up large sums of money.

Borrowing money to pay for a holiday can let you pay off your trip over time. Spreading out your repayments over a longer loan term can help make repayments more affordable, though you’ll likely pay more in interest. Choosing a shorter loan term typically means costlier repayments, but less total interest on the cost of your holiday.

With most holiday personal loans, you’ll receive the money in a lump sum after a successful application, and start making repayments straight away. This can be handy if you have a good idea of your maximum holiday budget. But if you overestimate the cost of your vacation, you may be stuck paying interest on a larger loan amount than necessary.

Borrowing to pay for a holiday can be convenient, but can come with some risks. If you do your calculations beforehand, and work out how much your holiday is likely to cost you in total, including fees and interest charges, a personal loan or something similar could be a useful option to consider when you’re planning your next vacation.

Finding the personal loan that’s right for you

If you're seeking a personal loan with repayments that fit your budget, credit score and desired loan term, RateCity's personal loans calculator can provide you with an estimate to help find one that's right for you.

RateCity has ranked the top-rated personal loans on our Personal Loans Leaderboard using our comprehensive, game-changing Real Time Ratings™ system. This system gives loan products a score out of five, based on cost and flexibility. Unlike other ratings systems that rank their products once or twice a year, our Real Time Ratings™ system ranks products live as you use the site, helping you narrow down your shortlist of personal loan options.

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