10 Things to Know About Travel Loans in India
Travelling to new places is never as expected. For one, you cannot plan how much money you will need for a trip. Budget constraints can spoil any vacation plans. In such a case, a travel loan can be the best option. Whether you are planning a domestic or international journey, you should consider applying for a travel loan in India to fund your vacation.
Ten things to know about travel loans in India
1. A travel loan is an unsecured loan.
An unsecured loan is a loan without putting up any security. Therefore, you will require no collateral to secure your travel loan. Your income alone may be sufficient for approval, and the lender will allocate a credit limit based on the vacation plans and your income.
2. There are several loan repayment options.
A travel loan in India is simple to pay back. For repayment, you can use either the Electronic Clearance System (ECS) or the National Automated Clearing House (NACHA). You can also issue post-dated checks, use a debit order or instruct your banker to set up a recurring interbank transfer.
A loan for your travel expenses can provide you with simple and adaptable payback terms. However, repayment terms are flexible and entirely at the borrower’s discretion. When you take out a travel loan, you can repay the money in EMIs over the loan tenure. You can prepay the loan in a lump sum or part any time before the term is over.
3. A travel loan in India covers more than just the cost of travelling.
Travel loans are often misunderstood. Many think you can only use them for transportation costs. All your trip costs, from plane tickets to hotel stays and meals, can be covered under a travel loan in India. You can get the most out of your trip without taking money out of your pocket.
4. A travel loan in India needs minimal processing and documentation.
If you apply for a travel loan in India, you do not need much paperwork to get approved. You need only show confirmation of residency, identification, and financial stability. Your travel loan in India will be approved after supporting documents are verified.
These documents are:
- PAN card
- Aadhaar card
- Address proof
- Bank statements
- Salary slips (for salaried applicants)
5. You can apply for a travel loan in India online.
A travel loan in India can be obtained over the internet. To apply, visit the online service of a lender and fill out the application form. Another option is to download the lender’s app and use that instead.
The rapid approval time of an online travel loan service is a benefit. You need not go to an office to get a travel loan in India. All documents can be uploaded online.
6. Travel loans in India are a far better option than credit cards.
A credit card’s flexible spending options could make them more appealing than a dedicated travel loan at first glance. Unfortunately, that is not the case.
A travel loan in India has lower interest rates than a credit card. Also, the limited credit limit on credit cards is lower, making them poor options for financing a trip. Credit cards can also be complex to use internationally. Many credit card providers may not provide this facility if you are not a frequent international flier.
Hence, a travel loan in India is superior to credit cards for travelling.
7. You can only borrow a limited amount.
There is a limit on how much you can borrow for a vacation loan because travel loans in India are unsecured. The maximum amount you can borrow depends on your monthly income, credit score, and job type. Hence, consider the credit limit before planning the vacation.
8. You should consider after-sale service when applying.
Choose an honest lender who is upfront about all the fees and interest that will be taken out of your account. This will allow you to plan EMI payments. Furthermore, consider your financial capacity before applying for a loan.
9. You should try to maintain your credit score.
It is easier to secure travel loans in India if you have a high credit score. If you have a high credit score, you may also be able to increase your current credit limit. A travel loan approval is easy with a credit score of 700 or above. If you can make your loan payments on time, your credit score and available credit will improve.
Your application for a travel loan will be strong with these considerations in mind. In India, a good credit score will allow you to borrow up to Rs. 25 lakh. In addition, you may effortlessly handle your travel and loan repayment after making the right option regarding a travel loan.
10. You should look for alternatives before making a final call.
Before choosing a travel loan, shopping around at other financial organisations is best. You may forego a great deal of discretionary spending this way. Remember that a larger credit limit from one lender may have a higher interest rate.
It is prudent to compare the interest rates offered by various financial institutions and consider your desired borrowing cap. Pick the one that will allow you to pay your bills without increasing your interest rate.
Travel loans in India are one of the simplest ways to get credit for a vacation. While travel loans are secure and have affordable EMIs, you should limit your borrowing. Travel loans in India are unsecured loans. However, you may not qualify for them if you have a poor credit score or low income.
Did you find this article helpful? Visit Piramal Finance for more valuable content on personal finance, investing, and money.
Also Read: All You Need to Know about Pre-approved Personal Loans Interests
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