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Here’s what you need to know about Christmas loans. Learn more about the benefits and downsides. (Shutterstock)
It can be expensive to pay for Christmas gifts and other holiday-related costs like food, decorations and travel. That’s why many people seek out Christmas loans. These loans can make it easier to cover these expenses so you can thoroughly enjoy the holiday season.
Here’s everything you need to know about Christmas loans.
If you’re looking for a Christmas loan, Credible makes it easy to see your prequalified personal loan rates from various lenders, all in one place.
Christmas loans are personal loans you can use for a variety of holiday expenses. Just like other types of personal loans, a Christmas loan can be secured or unsecured. Factors like your credit score, income and the lender you choose will determine your terms and eligibility. You’ll need good credit to qualify for the lowest rates and most favorable terms.
With a Christmas loan, you’ll receive a lump sum of money up front and repay it over time, usually via fixed monthly payments.
Christmas loans are typically offered by online lenders and credit unions. Since every lender has its own eligibility requirements, rates, and terms, it’s a good idea to shop around and compare options.
Keep in mind that some Christmas loans, which are sometimes called no-credit-check Christmas loans, are actually payday loans with sky-high interest rates of 400% or higher. That’s why you want to look for holiday loans that are traditional personal loans and cap their interest rates at 36%.
Every lender has its own borrowing limits for Christmas loans. But in general, you’ll find that most of them range from $1,000 to $50,000. Your credit score, debt-to-income ratio, and other factors will determine how much you’ll be approved for. If you have good credit, you’ll likely be able to borrow more than someone with fair or poor credit.
While eligibility criteria for a holiday loan can vary by lender, a few common requirements include:
Visit Credible to compare personal loan rates from various lenders, without affecting your credit score.
If you’d like to take out a Christmas loan, follow these steps:
Just like all financial products, Christmas loans come with pros and cons you should consider, including:
Christmas loans offer a few potential advantages:
Christmas loans also have some possible drawbacks to consider, such as:
If you’re not interested in a Christmas loan, consider these alternatives to help pay for holiday expenses.
If you’re ready to get prequalified for a loan, Credible lets you quickly and easily compare personal loan rates to find one that works for your unique situation.
Quotes displayed in real-time or delayed by at least 15 minutes. Market data provided by Factset. Powered and implemented by FactSet Digital Solutions. Legal Statement. Mutual Fund and ETF data provided by Refinitiv Lipper.
This material may not be published, broadcast, rewritten, or redistributed. ©2022 FOX News Network, LLC. All rights reserved. FAQ – New Privacy Policy
What you need to know about Christmas loans – Fox Business
