Travelling isn’t a piece of cake. It takes courage, hard work and plenty of money. Pretty much every travel aficionado has the first two in spades. Sadly, the last one is hard to come by. People spend a lifetime chasing cash and still don’t achieve their goal.
Enter a loan, a quick injection of cash which will fund the entire trip. Excellent – now there is no reason to worry about money. Well, apart from the interest and repayment rates. But, you’ll cross that bridge when you arrive at it with zero cash in your account, right?
Truthfully, you can avoid a showdown by obtaining unsecured debts. Here are the reasons why.
There Are No Assets
Unsecured means that there isn’t anything valuable the lender can take as collateral. A car loan, for example, will secure the vehicle against the repayments. The same goes for a mortgage. Should you fail to keep up with the agreed deal, then the lender will take everything to cover their backs. Thankfully, not all loans are like this according to www.forbes.com. A credit card is unsecured, which means your rating will take a hit but not much else. When you think about it logically, it’s a no-brainer because the pitfalls are small.
Credit Is Repairable
Let’s address the elephant in the room – terrible credit. A bad score can impact your ability to lend or buy a house in the future. A bank will look at your rating, among other things, and assess the level of risk. Anything under 550-500 isn’t worth their time. There is good news in all of this, and it’s the following: credit isn’t set in stone. Anyone can rebuild their rating with the right moves. For example, start paying off the debts on time. Or, set up a payment plan and hit the targets. Bad credit isn’t the end of the world.
You Can Merge Them
It’s tempting to think that you couldn’t manage multiple debts before, so you won’t be able to do it again. Don’t let a defeatist attitude hold you back. Firstly, anything is possible, especially when you understand the consequences of failure. Secondly, there are resources which can help travellers with unsecured arrears. www.debtconsolidation.co deals in merging balances into a one-off, monthly payment. That way, it’s easier to be punctual and avoid late fees and creditor phone calls. Consolidating isn’t for everyone but it does have its benefits for people who are unorganised.
They Aren’t As Important
No one is saying that you should stop paying off the balance right now. There is a financial and moral obligation to being in debt. What www.moneycrashers.com does point out is that they are the least important balances. As a result, the last resort is to stop paying them altogether and focus on secured loans and assets. There is no reason to file for bankruptcy or anything like that, but a call to the lender would be polite. Inform them of the situation and see if there is a middle ground.
The question is – are you travel loans secured or unsecured?
