As the housing crisis continues, experts are urging some consumers to rethink getting a holiday loan this year. While this type of financing is general cheaper than relying on credit cards to finance a holiday, right now is not the best time to get low rates on a holiday loan. As banks seek to reduce the amount of risk they are carrying, few are interested in offering holiday loans at this time. This may create a problem for some consumers, but most will appreciate being able to avoid high interest rates and strict payment terms.
Drew Wotherspoon of John Charcol stated, “Whilst the mainstream market is basking in a moment of encouragement, there are worrying statistics coming from S&P on the UK’s sub-prime borrowers. They have revealed that more than a fifth of these borrowers have fallen behind with repayments. Of course this is only to be expected with the market as it is, but there is a clear message for these consumers - don’t bury your head in the sand. Talk to your lender; they have a duty of care to help you with your situation and it is much better to keep them informed than to just ignore your financial commitments. Ignorance is most definitely not bliss.”
Related reading: Holiday Loans
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