Basically there is the possibility to borrow money privately from relatives or acquaintances. It is straightforward and the money is immediately available. As a rule, family members or acquaintances of not charge interest. Actually a very charming form of travel credit. In reality, however, hardly any German uses this option. Why is this form of travel credit so unpopular with German consumers? “Friendship stops when it comes to money,” is a well-known phrase – and this attitude is reflected in the low prevalence.
It is different with the so-called peer-to-peer travel loan, which can be obtained via online credit marketplaces. Here, too, you can borrow money from private individuals, albeit anonymously. Borrowers can present their project, in this case a planned trip, to other participants on the platform. Private investors can view the project and relevant data about the borrower and support them if they are interested. If enough investors come together to invest in the loan project, it will be financed and the borrower will get his travel loan paid out quickly. Travel credit from private to private has become a very popular form of financing, also with regard to the social component.
Payment in installments by the travel provider
Tour operators have long since discovered the gap in the market and are advertising, for example, with slogans such as “Great holidays immediately. Small installments later ”. Behind this are installment payments, which the tour operators offer when booking. The costs for flights and accommodation are spread over a period of six to twelve months and do not have to be paid in one fell swoop. However, pay attention to the interest that travel providers charge you so that there are no nasty surprises after your holiday.
Online instant credit
Since interest rates are particularly low at the moment and the chances of a cheap travel loan are very good, most consumers can take a holiday with an instant loan. A travel loan is fundamentally no different from a normal installment loan. The procedure is basically the same. You apply for a loan, enter all the relevant data in the application form and submit the required documents. An online instant loan has the advantage over classic bank loans that you get a loan decision immediately and the money is paid out to your account very quickly. You can favor a good interest rate, for example, by providing collateral such as life insurance or by adding a second borrower. Appropriate collateral reduces the risk for the credit institution. Depending on the provider, the interest rates and terms vary considerably. It is therefore worth comparing different banks.
If you don’t want to borrow money from banks or other people, theoretically there is also the possibility that you overdraw your account and thus take out an overdraft facility. However, a disposition can quickly become a cost trap. The interest on the overdraft facility is usually significantly higher than that of an online instant loan. Even in the current low interest rate phase, the overdraft rates of many banks are still over 10%. It is best to find out from your bank beforehand how high the interest rates for your overdraft facility are.
It is usually worth switching to an installment or instant loan. Also, don’t forget to keep an eye on the maximum overdraft facility limit. If there are other irregular debits after your vacation, such as annual car insurance or unscheduled costs for repairs at the house, then you quickly reach your overdraft limit. You should definitely avoid this, since the interest rate for overdrafting the overdraft loan can rise significantly again or, in the worst case, the bank can book back direct debits due to insufficient cover. For these reasons, we strongly advise against this alternative of travel finance.