Many of us relate Christmas to snow, Santa Claus, sparkling lights, tempting feasts, gifts, and spending happy time with family and friends. However, for some, amidst the festivities, there’s financial stress, unfortunately.
With gifts, decorations, spiced wine, and lavish dinners, it’s obvious to say that the festival season can put a strain on your wallet. Surrounded by happiness and joy, Christmas loan proves to be a miracle for all those in need.
Financing a holiday is one of the solutions if you want to borrow funds for the festival. There are other options too. This blog explains you of what a Christmas loan is, its pros and cons, as well as alternatives to help you get through the holiday season happily at the same time keeping your personal finances intact.
Getting a Christmas Loan
These are personal loans to cover all the holiday expenses incurred by you. They are offered in several forms:
One of the forms is represented as payday loans but in a festive mask. The harmful side weighs heavier than the right side of it.
In the case of these funding sources, the repayment terms are concise, and interest rates are soaring high. While borrowing, you have to be extremely careful as it can land you up in more debt than you initially had.
Personal Loan Instalment is another form being offered. Comparatively, the payday loans are far more expensive than personal loans with an interest rate.
Bad Credit History
Unlike traditional bank loans, bad credit doesn’t hinder in the approval process. You can easily apply for an instalment loan online and get it approved. Within 48 hours of approval, the money gets deposited into your bank account.
- The online process involves less paperwork and no one-to-one interactions. There’s also less paperwork and no face-to-face appointments. Whether you opt for a payday loan or personal instalment loan, you are eligible for Christmas loans for bad credit. Considering all the factors, there are a few essential distinctions between these two lending products.
- Payday loans are attractive as they offer funding with no credit check. However, payday lenders face a high risk due to short repayment timelines and higher interest rates. Generally, no positive repayments are reported, so it is not easy to build your credit score.
- Personal instalment loans involve a customisable repayment schedule and a far lower interest rate. By borrowing personal instalment loans, it is easy to build a good credit score with positive monthly payments.
The better is your credit score; the better interest rates will be available to you. Before applying, it is always advisable to look for ways to improve your credit score.
The two sides
There are always two sides of a coin. All forms of financing have pros and cons both attached to them. Christmas Loans are no exception. Before proceeding, it is essential to understand and evaluate the advantages and disadvantages of financing.
Advantages /Disadvantages / Alternative of Christmas Loans
Advantages
- Alleviates financial stress
The first and foremost advantage is that it alleviates financial stress. With the increasing financial stress, in the middle of the festivities, is never fun. In these challenging times, these loans act as a saviour and relive financial stress. They provide you with the space to breathe and help you relish these festival times with your loved ones.
- Fast and convenient
These loans are quick, convenient, and easy to borrow whenever you need one. The internet facilitates the process of your approval and depositing of funds within 48 hours.
- Credit-building opportunities
Such loans not only help you to alleviate your financial stress but also rebuild your credit score. They are easily attainable, even with a low credit score. It all depends on choosing the right type of product (i.e. personal loan). Choosing Payday ones do not offer this benefit.
Disadvantages
- High interest
Many times, these loans involve very high-interest rates adding to the pile of already existing financial stress.
- Repayment
Here comes the reality check. To relieve your stress, you should only borrow the amount which can be easily repaid in a reasonable amount of time.
Alternatives
These are available to everybody if somebody needs them, but they shouldn’t be the only option to consider. There are alternatives that you should consider for your holidays:
Plan B
You should focus on creating another income source. Getting a second job will provide you with some extra cash for same.
Save
It is always good to save. You can build up a cash fund for your holiday expenditures by working on your budgeting skills.
Plan ahead of time
To avoid any trouble, do not leave your shopping until your last minute. If you plan things ahead, it means you are giving time to yourself to gather everything you need for the festival and take advantage of early shopping events.
The bottom line
If you are planning to apply for a loan, plan and with a trustworthy lender who offers reasonable interest rates.
They can be a significant assistance for the celebration time and your holidays. The tension of paying for Christmas shouldn’t detract from this particular time with your family and friends.
Jessica Rodz is the Senior Content Writer at Cashfacts. She has a long career in the field of content writing and editing. Jessica has the expertise in the UK lending marketplace where she has worked with 7 different lending organisations and acquired many responsibilities from preparing loan deals and writing blogs for their websites.
At Cashfacts, Jessica is managing a team of experienced loan experts and doing a major contribution in guiding the loan seekers via well-researched blogs. She has done graduation in Business (Finance) and now currently doing research papers on the UK financial sector.
