Summer is here, and while the lockdown might be dampening spirits, it is not too long until it opens up, and you can go on that long-awaited summer vacation. However, if your budget is falling a little short, a personal loan can help you achieve that dream vacation, and it isn’t as complex as it is made out to be!
What is a personal loan?
Loans usually have some ‘collateral’ against them, like a house, vehicle, or gold. These items are the surety that the lender will receive the payments against the loan. A personal loan is a loan that has no collateral against it. No kind of security, collateral, or guarantor is required.
A personal loan can be used for whatever purpose the applicant wants – including travel!
How to apply for a personal loan for travel?
The process of applying for a personal loan for travel isn’t any different from a regular personal loan calculation. You need to have a few documents in place:
- Photo identity proof (Voter ID, passport, driving license, or Aadhaar card will all do)
- Address proof (ration card, electricity bill, or passport)
- Salary slips for the preceding three months
- Bank statements for the preceding six months
- Proof that you have been employed for the last 1 year at least
Of course, you’ll need to have a decent credit score – anything above 750 will be considered, but the higher it goes, the larger the amount that will be disbursed.
The personal loan interest rates start at 10.99% with lenders. However, the rate of interest for a personal loan and the EMI depends on various factors like the applicant’s eligibility, income, CIBIL score, etc.
What are the amounts and tenures available for a personal loan?
Personal loans vary, beginning at Rs 75,000 and going up to Rs 25 lakh, depending on the applicant’s eligibility. The personal loan tenure can range from 12 months to 72 months, i.e., 1 to 6 years.
How to customize your personal loan for travel?
Personal loans can be repaid in two ways: one way is the traditional fixed EMI, and the other is the Step Up Flexi EMI Plan that allows you to repay the loan with any extra income you might have in the future.
Many websites also offer useful tools. A personal loan EMI calculator helps you calculate the exact amount you will have to pay each month. A prepayment calculator helps you understand your payable amount, should you choose to pay off the personal loan before time. It also shows you the steps to transfer a personal loan from another lender, should you choose to do so.
A personal loan for travel makes perfect sense if you can repay the loan amount consistently. The fact that you need no collateral and the loan is disbursed quickly and with minimum fuss makes it a great option to make your dream summer vacation happen!