Can you use buy now, pay later for travel?

If you spend any time online shopping, chances are you’ve seen buy now, pay later options. As that option has increased in popularity, it’s now spread to the travel industry as well. What’s available in terms of buy now, pay later travel options? Let’s find out.

How do buy now, pay later loans work?

Buy now, pay later options may be referred to in a few different ways. For instance, some may call them point-of-sale loans or installment payment plans. Regardless of the name being used, they all work in essentially the same way.

You can think of buy now, pay later working like any other type of installment plan — usually just on a much smaller scale. It allows you to pay for your purchase with set payments over a period of time, rather than with one lump sum. How long you get to pay off your purchase varies. Some buy now, pay later options are interest-free, but come with a fixed fee.

If you like the idea of a buy now, pay later option for purchases, you might be glad to know that you might even be able to use this for travel.

Buy now, pay later options for travel

When it comes to buy now, pay later travel options, they can take a few different forms — from entire, all-inclusive vacations to something simpler like an airline ticket payment plan.

Vacation packages

There are some sites that have partnerships with hotels, airlines, cruise lines, travel agencies and vacation package providers that allow you to book your entire vacation using a buy now, pay later option. If you go this route, you could be required to pay a deposit when checking out, or you may not be required to pay anything. From there, you can choose from one of the payment plans they offer and possibly sign up for automatic payments or choose to make manual payments each month.

Flights

If you’re hoping to find some buy now, pay later flights, there could be options there, too. Some airlines offer payment plans directly, while others partner with third parties to offer this type of option. Many major airlines have a point-of-sales loan option, which could make booking a flight easier if you don’t have one lump sum ready when you book your trip.

Hotels

Whether you’re planning a big international trip or taking a long weekend nearby, a hotel payment plan may interest you. Some booking sites partner with buy now, pay later lenders, which could allow you to spread your payments over the span of a few months if you choose.

Cruises

If you’ve been wanting to hit the open seas, there might also be point-of-sales loan options for cruises. Many cruise lines offer payment plans themselves, though there are also third-party sites that let you buy now and pay later, as well.

Buy now, pay later with Chase

If you’re a Chase cardmember, you may already have buy now, pay later features to help manage your budget, including:

Chase Pay Over Time℠: This allows you to break up purchases you’ve already made into budget-friendly payments and pay it off over time. Chase Pay Over Time could help you manage your expenses before you take your trip (airline tickets, hotel stays, planned excursions), as well as purchases made during your vacation.

My Chase Loan^®: Eligible cardmembers may also have an available My Chase Loan offer, which can give additional flexibility when planning out their travel budget. This feature of Chase credit cards provides a loan using a portion of your credit card’s available credit limit. The loan is deposited to your bank account in as little as one to two business days, giving you the cash you need for life’s planned and unplanned expenses. You can pay it back over time with a fixed APR and duration that works for you.

Pros and cons of buy now, pay later

While paying for a vacation over time rather than all at once might seem like a no-brainer, there are some pros and cons you should consider, including.

Pros

• Less interest: You could end up paying less in interest if you go with a buy now, payer later travel option, compared to other forms of credit. For instance, you’ll likely pay more in interest on your credit card if you pay for travel that way, as there are options for interest-free payment plans when it comes buy now, pay later.
• More options: Buy now, pay later could be a good option if you have poor or limited credit. While it’s unlikely to help build your credit, it might afford you an option to pay for a trip over time that you may not have had otherwise.
• Good in emergencies: Point-of-sales loans may be helpful in the case of an emergency that your savings can’t cover or if your funds are otherwise inaccessible. For instance, if your house floods and your insurance won’t provide funding for alternative accommodations upfront, you may be able to use a buy now, pay later hotel option.

Cons

• Could break the budget: Something that you may have thought of as beyond your budget may seem affordable when the price is given to you in smaller increments. It’s important that you work out the total (including any applicable fees or interest) you’ll pay and ensure that you can actually afford to make your payments on time until it’s paid off.
• Might not help credit: Though point-of-sales loans feel a lot like more traditional credit lines, they might not actually help build your credit. If you have the ability, it may make more sense to use a credit card to pay over time to help ensure your on-time payments are reported to the credit bureaus. Some credit cards also offer rewards on purchases, especially for travel, that you may not get with a buy now, pay later plan.
• May still have interest: You may still owe interest on buy now, pay later payment plans. Some lenders only add interest fees for longer loans, but these rates can be over 30%.
• Additional fees: There can sometimes be other fees associated with these plans, too. Some lenders charge a convenience fee per installment, while others may charge fees for things like missing a payment.

In summary

Buy now, pay later travel options can be a potential way to make it a bit easier to fit a vacation into your budget. However, it’s important to read the fine print and make sure you understand any applicable interest and fees that you could potentially owe. Take the pros and cons of buy now, pay later into consideration and decide if it’s what works best for you.