Make Yourself Aware with the Advantages and Disadvantages of Travel Loan

Last Updated : March 12, 2020, 3:21 p.m.

There is no denying on the fact that today lot of youngsters share one common passion and i.e. is travelling. Yes, almost half of the generation is young today, and prefers to travel at different locations so as to take a break from mundane life. But, sometimes due to lack of money or financial issues, some people have to postpone or cancel their travel plans. And, the only hurdle behind this is insufficient fund for travel.

However, most of the time, people save enough money for travel, but there are times, when situations are not under your control. More to the point, sometimes, when unplanned situations like friend’s sudden marriage, a bachelor bash overseas, or an occasional travel deal that is just too tempting to resist. In such situations, you can opt for travel loans and can get funds for your travel needs. Yes, you can apply for personal loan to cover all your travelling expenses, and can enjoy your travel to the fullest. With less documentation and no collateral required, the process to avail a personal loan is quite simpler. Moreover, it not only helps in covering all your travelling expenses, but provides you the instant funds to make your travel totally unforgettable. But, before you go for travel loan or personal loan, if you can cleverly budget your trip, it would be absolutely great for you.

So, just for your reference, in this article you will get to know about the advantages and disadvantages of travel loan

Advantages of Travel Loan

• Because travel loans are unsecured, thus there is no need to worry about guarantor or collateral.
• For travel loans, the rate of interest can be as less as 11%, depending up on your eligibility criteria.
• There you will have fixed monthly EMIs to repay your loan amount.
• The tenure of the loan usually ranges between 1-5 years, as many banks depending upon many factors can increase or decrease your tenure.
• Simple documentation is required, and it gets quickly proceed by the banks.
• The loan amount which you will get can be used for booking air tickets, paying the hotel bills or any other travel expenditure.

Disadvantages of Travel Loan

• Travel loans are unsecured loans, hence are backed only by trust and are on the more risk from lender’s point of view.
• The rate of interests are higher on such unsecured travel loans .
• Even, those who are on bad credit score, have to face the higher rate of interests.
• The loan amount being provided to you is quite less because of the risk factor.
• Moreover, these unsecured travel loans come with lack of flexibility, being offered to the applicant.

So, if you are going for travel loan, make sure that you have strong repayment plan. If not then save your hard-earned money carefully by managing your finances, and enjoy your travel!