Unmatched Features & Benefits of Travel Loans
Last Updated : March 25, 2016, 11:24 a.m.
Are you planning to visit your dream destination this summer? If yes, but if your budget does not allow you to even think of it. Well, nothing to worry because travel loans are here to make your trip memorable for sure. Yes, with the help of travel loans, you can accomplish all your dreams and can visit your dream destination in no time. When it comes to availing these loans, it would not be wrong to say that it is easy to get from most of the lenders without any hassle.
Moreover, you don't need to worry as far as availing these loans are concerned because of their easy and simple documentation and quick disbursal as well as approval. So, before going any further, let’s try to understand what basically travel loan is all about.
What Travel Loan Stands For?
When it comes to travel loans, they are usually a variant of personal loan.Yes, to cover your travelling expenses, you can also apply for personal loan as many lenders offer you personal loan for travel. While applying for this loan, you need to specify the reason to the bank that you want to take a personal loan for the purpose of travel. Once the lender has agreed, you can go ahead with the process, and get the loan. These types of loans are generally considered as unsecured, but can also be structured as partly or fully secured loans. In travel loan, the loan amount is usually limited to 80% of the total travel expense including your tickets, visas, insurance, stay and any other sundry charges, if any. However, depending upon the loan repayment capability of the borrower, the banks vary their travel loan amount.
Banks usually offer travel loan for two-to-three year period to the applicant of 21 to 60 years of age group. However, not only one, but many banks offer travel loans to senior citizens also, only if their age does not exceed exceed beyond 70 years on the loan completion date.
As far as loan processing fee is concerned, it ranges between 1 to 3 percent of the total loan amount. But, different banks charge different processing fee from applicants. Not only this, if your travel loan amount is ₹ 2 lakhs or above, in that case, the banks or lending institutes ask for your guarantor or collateral. There are many public and private banks are happy to offer such loans to all the eligible applicant, and make their travelling experience worth remembering.
Travel Loan EMI Calculator
Lets' understand the concept of travel loan with the help of an example below.
Suppose you want to travel to Hong Kong and want to avail a travel loan of ₹ 8,00,000 for that. Now, one lender is ready to give you this loan amount at an interest rate of 12.50% p.a. for 5 years, what would be your EMI? What is that amount that will go every month from your pocket? Excited in knowing? Well, go through this article below.
| Loan Amount (in ₹) | Interest Rate | Tenure | EMI (in ₹) | Interest | Total Amount (in ₹) |
|---|---|---|---|---|---|
| 8,00,000 | 12.50%p.a. | 1 | 71,266 | 55,195 | 8,55,195 |
| 8,00,000 | 12.50%p.a. | 2 | 37,846 | 1,08,300 | 9,08,300 |
| 8,00,000 | 12.50%p.a. | 3 | 26,763 | 1,63,464 | 9,63,464 |
| 8,00,000 | 12.50%p.a. | 4 | 21,264 | 2,20,672 | 10,20,672 |
| 8,00,000 | 12.50%p.a. | 5 | 17,998 | 2,79,901 | 10,79,901 |
| Year | Principal (in ₹) | Interest (in ₹) | Balance Amount (in ₹) |
|---|---|---|---|
| 1 | 122,858 | 93,118 | 677,142 |
| 2 | 139,124 | 76,852 | 538,018 |
| 3 | 157,548 | 58,428 | 380,470 |
| 4 | 178,410 | 37,566 | 202,060 |
| 5 | 202,246 | 13,942 | 0 |
Amortization Table
So, now that you know what travel loan is all about, let's discuss some important travel loan benefits and features as well
Travel Loan Features
- Loans available from as low as ₹ 10,000
- Processing fee is applicable according to individual banks’ terms
- Loan amount disbursed as per your requirements
- Loan repayment tenure ranging between 12-60 months
Travel Loan Benefits
- Reasonable form of credit than credit cards
- Flexible repayment tenures
- Fast and convenient processing of applications
- Travel loan amount is available as per your requirements
Loan prepayment option is available in many banks as per their terms and conditions
Student Travel Loan
If you are a student and willing to travel to your favorite destination, but don't have enough funds, worry not as student travel loan is here. The students can easily apply for travel loan as there are many lenders available in the market, known for offering this loan to the students with simple and easy process. Student travel loan benefits are many, hence is very popular among students.
Student Loan Benefits:
When it comes to student loan, it offers plenty of benefits to all the students who want to travel to their favourite destination. If you are a student and want to travel to your favorite destination, but don't have enough funds, student loans comes to you with a host of benefits such as easy to get, hassle-free process, minimal documents, quick disbursal and so on. So, whenever you are in need of urgent funds to fulfill your travel wish, all the students can apply for student loan being available with a lot of ease.
(Updated on: 15th October, 2016)