Compare loans to help you get to where you want to be.
If you need a holiday but don't have the money to cover the cost of the trip, an unsecured personal loan can give you access to the funds you need to cover your travel, accommodation and expenses.
Find out if you can use a personal loan to pay for your holiday and whether it's right for you below.
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RateSetter Unsecured Personal Loan - 3yr Fixed
RateSetter offers this unsecured personal loan with a fixed or variable rate. Receive a tailored interest rate from 7.59% p.a. based on your risk profile.
- Interest rate from: 7.59% p.a.
- Comparison rate: 8.19% p.a.
- Interest rate type: Fixed
- Application fee: $89
- Minimum loan amount: $2,001
- Maximum loan amount: $45,000
Compare holiday loans now
- Harmoney Unsecured Personal Loan: 7.69% p.a. comparison rate. Get a competitive rate based on your credit score and borrow the funds you need for that holiday.
- Pepper Money Unsecured Personal Loan: 9.99% p.a. comparison rate. An unsecured personal loan with flexible repayment options and no monthly fees. Suitable for funding your holiday.
- SocietyOne Unsecured Personal Loan: 9.51% p.a. comparison rate. Lower rates for good credit borrowers. Suitable for use as a holiday loan.
- Latitude Personal Loans: 15.19% p.a. comparison rate. Borrow up to $50,000 with the Latitude Finance Services Personal Loan.
How do holiday loans work?
Holiday loans, also known as travel loans, are simply unsecured personal loans that allow you to use the funds to finance your trip. Most personal loans allow you to spend the money on any worthwhile purchase or expense, and this generally includes holidays and any other trips.
You can generally borrow from $2,000 up to around $50,000 and then have between 1 and 7 years to repay the loan amount. You may receive either a fixed or variable interest rate, which is typically 8–17% p.a. but will vary depending on the type of loan and your personal credit history.
Personal loans can either come as a term loan, where set loan terms apply, or as a line of credit, where you can draw from your credit limit as you need it. With a credit line the terms are ongoing and the repayments are flexible. You will generally only make repayments on the amount you have borrowed.
Some providers also offer products that are tailored to travel. You may be able to spread payments of a tour or travel package out over the few months before you leave or you could be given interest-free terms on a travel loan. Two examples of these types of programmes are TigerAir and zipMoney.
Are there restrictions on how I can use a holiday loan?
On an unsecured personal loan, there are generally no restrictions as to how you use the funds (as long as they are legitimate). When you apply for a loan, a lender will ask you to list how you will use the funds as part of the application process. With a loan for a holiday, you would therefore select "holiday" or "travel".
If you're applying for a loan from a travel loan provider, such as with holiday payment deferment programs or with interest-free terms, you will be required to use the funds as set out in the terms.
How can you compare holiday loans?
- Fixed or variable interest rate. A fixed rate allows you to lock in a specific rate for the life of your loan, whereas a variable rate may change over the course of the loan. However, you will usually get fewer restrictions with a variable rate loan. For example, you can usually repay the loan early without penalty or make additional repayments throughout the loan term. Fixed rate loans are generally for up to five years whereas variable rate loans can be for as long as seven.
- Cost of repayments. When calculating the cost of your repayments you should take into account the interest rate you will be charged as well as any ongoing account-keeping fees, as these will contribute significantly to the cost of the loan. If you are able to afford higher repayments, then this could reduce the amount of interest you pay over the life of your loan. Using a repayment calculator can help you plan how you can repay the loan ahead of time.
- Loan term. Personal loans generally have a minimum term of one year, up to a maximum of seven years. A longer loan term may reduce the size of the repayments you need to make, but will generally mean you pay more in interest over the life of the loan.
- Additional features. Take a look at the features being offered by some lenders and decide if you want to take advantage of them. Some banks offer cheaper travel insurance with their holiday loans as a package deal. It may be worth looking into this and comparing the costs with other insurance providers.
What should you consider before applying?
Before you apply for a holiday loan you should determine the cost of your repayments and decide whether they will be affordable for you. You should also ensure that the amount you're borrowing will be sufficient for your holiday and whether the loan terms will be manageable. Remember that you will likely have to make repayments while you are away, so make sure you budget for this.
How you can apply for a travel loan
To apply for an unsecured personal loan you should first compare your options using the table on this page. Once you have chosen a loan you can click "Go to Site". Eligibility criteria differ between lenders, so check you meet the criteria before you apply.
You will also need to provide certain information to apply. This may include personal details such as your name and address, financial details including your income, assets and debts and your employer's name and contact details.