Timeshare loans are a great way for you to take advantage of the many benefits of owning a timeshare. They offer you access to a specific property for a certain amount of time each year, so you can enjoy your vacation time and build memories with your family.
They can also be a fantastic way to save money on your vacations, especially if you travel frequently and often stay in a hotel or resort. However, you need to be careful about how you finance your timeshare.
The first thing you should do is shop around for a loan that offers the best rate, and that is based on your credit score. This is essential to getting a reasonable interest rate, because it can make all the difference in how much you pay over time.
Some of the most popular timeshare financing options are:
Developer Loans – The easiest, and most convenient, option is to get a timeshare loan from the developer. The developers have an incentive to provide you with financing on the spot, which can be helpful if you need to move quickly on your purchase.
Unfortunately, these loans can have higher interest rates than other timeshare financing options. ARDA reports that the average rate for a ten-year loan is 14%, and the interest rate is even higher for buyers with poor credit.
Alternatively, you could use a home equity loan to finance your timeshare. These types of loans are secured by your primary home, so you can usually obtain larger loan limits and better repayment terms.
Personal Loans – If you have good credit, an unsecured personal loan can be the way to go. These loans can come with higher interest rates than a home equity loan, but they are likely to be less than a developer offer.
Another option is to use a credit card to finance your timeshare. Some credit cards may offer low interest rates and other benefits, but be sure to read the fine print.
If you plan to use a credit card, be sure to avoid those that offer you no interest for a limited period of time. Some of these cards will only apply to a small percentage of your total credit limit, which can be a disadvantage if you don’t have the credit needed to take full advantage of them.
The other advantage of using a credit card to finance your timeshare is that you can use points or rewards to lower your interest rate. But be aware that you should only be able to use rewards points for the timeshare, not for other purchases, because you’ll lose the points after the timeshare has been paid off.
Other timeshare financing options include: