Sponsored: All you need to know about travel loan

Sponsored: All you need to know about travel loan

When it comes to traveling, there are 2 kinds of people, the adventurous type and the homebodies. The former loves to travel, explore new places, and experience new things. These are the people who go through travel advertisements and browse through various blog posts in order to find their next vacation spot.

Most of us wonder how one has the funds to spend for a vacation? Regular savings or borrowing funds are the 2 ways to fulfill your vacation dreams. You can either put aside some money every month in a holiday fund or take a loan from the bank. Banks in India offer unsecured personal loans called travel loans at competitive interest rates to cater to travelers who require a significant amount of money to pay for their international and domestic travel expenses.

Why is travel loan preferred to credit card?
Travel expenses include flight tickets, accommodation, food, and road transportation costs. With a travel loan from the bank, you can explore your favourite holiday destination without having to worry about the expenses.

Travelers can opt for a travel loan as it is offered at a lower interest rate when compared to a credit card. Thus, you save money on overall interest payment when you opt for a lower interest rate personal loan.

Banks offer flexible loan repayment options so that you can prepay or foreclose your loan when you have a sudden inflow of cash. Remember, banks charge a prepayment or foreclosure fee. Therefore, read the loan repayment clause carefully.

Travel loan is basically a personal loan that can be used to pay your holiday expenses. Unlike a car loan, a personal loan can be used for any purpose. The end use of the funds doesn’t matter to the bank.

There is minimal paperwork involved in applying for and obtaining a travel loan. Banks compete with each other to provide faster loan approval and instant disbursal of funds. Apply loan online for speedy loan approval and disbursement.

You can purchase a suitable travel insurance policy for any contingencies such as theft or loss of baggage or travel documents, accidents, and delayed or missed flights. A travel insurance policy also serves as a supplementary health insurance cover when you require healthcare treatments and services abroad.

Travel loan EMI calculator
With the help of a loan EMI calculator, you can find out how much your loan will cost you each month. Personal loans are repaid in Equated Monthly Installments (EMI). Enter your chosen loan amount, loan tenure, interest rate, and processing fee into the tool. You will get an amortisation table with monthly EMIs, interest payment, outstanding balance after each EMI payment, and the principal repayment cost of your travel loan. Depending on the results, you can decide on your loan amount and loan tenure.

Travel loan eligibility criteria
An individual with a good credit score, steady income, and a stable occupation can apply for loan from the bank. Some banks offer pre-approved personal loans to make it extremely convenient for the customers. As long as you meet the personal loan eligibility criteria, you can get your funds within 24 hours. In order to avail a travel loan, the applicant must be minimum 21 years to maximum 58 years old with a minimum monthly income of Rs.10,000.

Documents required to apply for travel loan
Along with a duly-filled and signed application form, the applicant has to submit valid supporting documents such as identity proof, address proof, and income proof to the bank for travel loan application and processing. A salaried employee has to submit a recent photograph, copy of his or her Voter's ID, Passport or Driving License, processing fee cheque, last 3 months’ bank statement, the latest salary slip, and Form 16. A self-employed person must submit the above mentioned documents except for the salary slip.

Things to keep in mind when taking a travel loan
Plan your vacation in advance. If your monthly income and expenditure allows for savings, then put aside a vacation fund.

If you have decided to take a travel loan, then borrow depending on your repaying capacity and your travel expense needs.

Compare various travel loan offers across top lenders on a comparison website. Select a travel loan with a low interest rate and flexible repayment options.

Use the loan EMI calculator to calculate your total interest payment with a shorter and a longer loan tenure. Choose a suitable loan tenure wherein your total interest payment is lower.

Loan EMIs shouldn’t exceed 50% of your salary. It is advisable to maintain a low debt-to-income ratio or you may end up defaulting on your loan, and that isn’t good news.

Apply travel loan online for better deals, faster loan approval, and minimal paperwork.
Read the loan repayment clause carefully before applying for a travel loan.

Is your holiday fund not sufficient for your dream vacation? You don’t have to break your long-term savings or max out your credit cards to visit your favourite holiday destination.

Take a travel loan with a low interest rate to go on a lovely vacation with your family and friends.

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