PaydayNow Student Travel Loans: How to Pay for Your Trip

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You may have the opportunity to tour the world as a college student, whether through a study abroad program or a vacation trip. You should look into student travel loans if you’re on a limited budget.

What are student travel loans? The fundamentals

Student travel loans are essentially personal loans that students can use to cover expenditures such as transportation, food, and accommodation when traveling. With a travel loan, you’ll get a lump sum in the amount you qualify for, which is determined by your credit score, credit history, and income.

If you don’t have much credit experience, you may be able to apply for a loan with a cosigner (maybe a parent or guardian), depending on the lender. This may improve your chances of getting accepted.

Essential terms to be aware of when applying for a travel loan.

Annual Percentage Rate (APR)

The APR on loan is the amount of interest and fees you must pay a lender to borrow money. 

Other financial items, such as credit cards and mortgages, are also subject to APRs. The lower your APR rate, the less you’ll owe throughout a loan, and the higher your credit score, the lower your APR rate might be.

Loan term

A loan term is when you have to pay back your loan. Many personal loans range from 12 to 60 months, although other lenders offer long-term loans with terms up to 144 months. 

The shorter your loan duration, the higher your payments are likely to be.

Credit score

Your credit score is a numerical value that determines your creditworthiness, or how likely you are to repay a loan on time. It typically ranges from 300 to 850. Your credit score is determined by whether you make on-time payments, your credit utilization rate, the sorts of accounts, and your age. 

Annualcreditreport.com allows you to check your credit score for free from all three credit agencies.

Soft-credit vs. hard-credit inquiry: What’s the difference? 

Check if you can prequalify for a loan before applying to see what rates and conditions you might be eligible for. This is referred to as a soft credit inquiry, and it allows you to see what rates and terms you qualify for without affecting your credit score. 

If you decide to go ahead with the loan, the lender will have to run a severe credit check, which could temporarily harm your credit. Compare those offers with those from other lenders to get the best deal.

Cosigner

If your creditworthiness prevents you from obtaining a travel loan, you may try getting a cosigner (this can be a parent, guardian, or friend that has good credit). Obtaining a cosigner can assist you in obtaining a travel loan; however, if you cannot repay the debt, your cosigner will be held responsible.

If you’re a student, here’s how to acquire a travel loan.

Lenders often demand the following information when applying for a travel loan:

  • Name, address, and phone number 
  • Social Security number 
  • Income 
  • Bank account numbers

If you have a cosigner, they will also be required to supply this information. You’ll need to examine your credit to know where you might land because many lending organizations base their approval procedure mainly on credit ratings. 

If you don’t have much credit experience, consider having a parent or guardian (with good credit) sign the loan as a cosigner. Consider applying for a student credit card to improve credit and show lenders that you are financially responsible.

However, before signing on the dotted line for a travel loan, make sure you have a budget to repay loan over time. You don’t want to default on a loan because it can harm your credit score and stay on your credit report for up to seven years.

Student travel loans alternatives

While a personal loan may be a viable choice for certain students interested in traveling, it is not for everyone. There are a few alternatives to getting a travel loan.

Student loans 

You might be shocked to learn that student loans can be used to fund a vacation. However, this is generally not suggested unless you’re studying overseas because it’s unlikely to be relevant to your formal education. You may find yourself short on cash when it comes time to pay for more necessary expenses like classes, textbooks, and room and board if you use your student loans to fund your trip plans.

Student credit card

A student credit card is a credit card that is designed exclusively for students. They can be easier for students to qualify for because many don’t have as many requirements as a standard credit card. For example, credit score requirements for student credit cards may be lower, but you may have to pay higher APR rates.

Scholarships and grants

If you want to study abroad, you might be eligible for various grants and scholarships to help you pay for some of your travel costs. Before applying for any grants or scholarships, read the requirements carefully. Some may have specific requirements (for example, travel to specified locations) or are reserved for students enrolled in particular majors.

How to Plan a Travel Budget

You’ll need to budget your money carefully, just like any other significant expense to afford your travels. You’ll need to budget before boarding your plane and while you’re abroad to ensure you don’t overspend. You’ll need to: 

  • Calculate your income to determine how much you may spend. What expenses you can and cannot afford will be determined by your income. (As we’ll see later, it’s important to give yourself some wiggle room and budget for unanticipated costs.)
  • Decide how much money you want to spend while you’re on the road. Spending money on pricey meals, beverages, souvenirs, and hotels may be appealing, but such splurges can quickly deplete your budget. Prioritize how you want to spend your time and money when traveling, and look for ways to save money on housing and transportation.
  • Put money away in case of an emergency. While it may appear that you are reducing your spending limit, having emergency money on hand can be a smart move. When it comes to traveling, there can be a lot of unknowns, so having enough money to deal with any bumps on the road might be beneficial. Getting sick or hurt, losing your luggage, becoming the victim of a crime, or needing to change hotels or aircraft tickets are just a few examples.
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