Financial institutions make a killing when the summer holidays arrive, a time when loan requests rise. A trend that is on the rise, since travel is one of the products and services that has grown the most in terms of financing since the pandemic as the savings dammed up by the restrictions have been extinguished.
"Holidays are in fourth place among the products most financed by the consumer," explains the general secretary of the National Association of Credit Financial Establishments (ASNEF), Ignacio Pla. To this is added that 15% of consumers used financing last year to pay for their trips, seven points more than in 2021, according to a Kantar study.
However, requesting a loan to spend the summer is more expensive now than a year ago due to the rise in the official interest rate, currently 4%, which financial institutions are transferring to credits, whose Equivalent Annual Rates (TAE) - which include interest, expenses and commissions - are on average between 8% and 10% in personal loans, according to the Association of Financial Users (ASUFIN). However, "it depends a lot on the entity in which it is requested because there are quick short-term loans that can be used for trips that far exceed 10% APR", clarifies Antonio Luis Gallardo, head of Studies for the association .
The consumer can also find financing to travel for three or six months without interest. "An offer that is normally offered at the point of sale, which is very beneficial," explains Pla. These conditions are usually offered to a greater extent by unregulated financing entities "as a hook for new clients", but he warns that when a second loan is requested, the APR will be high.
Another option to pay for expenses related to the summer season are cards, a much more accessible way to get credit quickly and without paperwork. However, immediacy can end up being expensive, since in the case of splitting the payment, the APR of the card usually ranges between 16% and 18%, a much higher price than the average APR of consumer loans and that can exceed 20% if the card is revolving.
Many cards include assistance insurance, so Pla advises paying for plane tickets with this type of financial product. “In this way you will have the safeguard that if you suffer an accident or a health problem during the trip, the expense will possibly be covered”, he comments. In general, they warn from the Organization of Consumers and Users (OCU), credit card coverage "is usually scarce and restricted to the fact that the payment for the flight has been made with the card in question", although there are some with insurance "that exceed that of many insurers."
However, from Asufin they advise taking out travel insurance according to the needs of each consumer. Gallardo explains that the one that is usually included in the cards "is very basic", although there are some specific ones for trips with higher coverage -for example, the American Express card-, although the commissions are also usually high.
In any case, financing vacations, either with plastic or through personal loans, denotes a lack of foresight when it comes to managing the domestic economy. The reason, argues the vice president of the Association of Educators and Financial Planners (AEPF)", Javier Santacruz, is that vacations "are one of the easiest expenses to anticipate", since the amount "is very similar from one year to other". Savings, therefore, is the best option to face this item and the most economical, since the consumer will not have to pay interest.
However, in case of choosing to finance part or all of the vacation, it is advisable to return the amount requested in the shortest possible time, despite the fact that this entails a greater financial sacrifice each month. In this way, it avoids falling into the spiral of over-indebtedness, since "many times after financing the holidays, the same is done with the return to school, Christmas, Easter holidays...", warns Gallardo.
