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Is It Possible to Get a Loan for Vacation?

More and more Americans have been traveling in the past few years, and vacation loans may be behind this trend. 

A vacation loan is essentially just another name for a personal loan. Personal loans can be used for anything, such as weddings or medical expenses, however, some lenders sometimes promote these personal loans as vacation loans. 

Due to low interest rates and the flexible rules on some of these loans, people find it a lot easier to go on vacations. Since you don’t have to show any of your assets or properties, getting this loan is far easier than saving up for months!

On average, you can get $40,000 as a personal loan on an annual basis. Interest rates on these loans vary a lot. While some lenders may offer an interest rate of only 5%, others may state one of up to 36%!

If you want to go on a vacation, people will usually recommend that you use your own money or cash. Loans are generally seen as something you take out for necessity and not for a vacation. However, if you desperately need to go on a vacation, the following guide will explain how you can get a vacation loan.

How to Get a Vacation Loan?

The Traveling Fool says all you have to do is show your creditworthiness or your income. If you have a steady job and get income consistently, you can easily get a vacation loan. There are three lender types to choose from:

  • Bank
  • Credit Union
  • Online Lender

After selecting any lender, all you have to do is state that you need the loan for personal matters. Moreover, you will have to make them believe that you are a creditworthy and low risk to default. During the entire application process, you will be asked about your education, career, background history and where you have worked previously. Besides that, you may also be asked about your current job and salary. 

They can further interrogate you about your education. Some lenders will ask you to provide details of your employer and some other references that can prove your trustworthiness. 

Getting a Loan from a Credit Union

You can also get a loan from a credit union at an interest rate of 9%. A lot of credit unions provide loans above $10,000. You can quickly pay back the loan in monthly installments. However, the restriction on these loans is that they are only offered during a specific month. For example, credit unions offer these loans when it’s either summer or specific holidays are around the corner. 

Pros of a Vacation Loan

There are some advantages to taking a vacation loan.

  • Having a vacation loan can be equivalent to saving some money every month. However, instead of putting away the amount you need, you’ll be paying back the amount you owe
  • Most vacation loans have flexible rules, meaning you can easily pay your loan back
  • Usually, the interest rates on personal loans are low

Cons of a Vacation Loan

The cons of taking a vacation loan for a personal trip are as follows:

  • Taking a loan for a vacation can put you in debt
  • Additional loan fees can make the amount you have to pay back much higher than just the added interest rate
  • Some lenders have a prepayment penalty policy, which means you’ll be charged a fee if you pay your loan off early

Alternatives to a Vacation Loan

If a monthly installment to pay back your loan will be challenging to handle on your budget, a vacation with a loan is not worth it. Instead, you can opt for one of the following options:


Start saving a small amount from your salary every month for your vacation. You can decide on a set amount, which doesn’t have to be extreme! Decide on a reasonable proportion, such as 10 or 20% of your income, depending on your monthly expenses. 

Getting a salary advance

If you really can’t wait but don’t have enough savings, then you can try opting for an advance on your salary. Ask your employer to pay you before your payday, so you can go on a much-needed vacation or ask for an upcoming bonus to be paid in advance. 

0% credit card with 0% APR.

If you have a good credit history, then some lenders allow you to take a loan with a 0% interest rate, which means that you will not have to pay back any extra amount. 

Small business loan

A small business loan can help you, as well. You can return the business loan in a rather flexible period. Hence, you can utilize that loan for a vacation. 


In a nutshell, going on a vacation with a personal loan is a decision that everyone should make for themselves. If you can afford to take a loan for your vacation, then why not?  

However, if a small vacation loan can put you in a lot of debt, or you’ll struggle to pay it back — stay away! If you already have a bad credit score, you should also steer clear of a vacation loan. 

Photo by Simon Berger

Post Author: Lillia Hall

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Welcome to Foreigner’s Finances, your guide for new money decisions at home and traveling abroad!

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June 2024