Buddy Loan helps you avail the best vacation loan online with best repayment options and lower interest rates for your dream vacation. Further, it aids your credit score if it is dropping to a negative scale.
What is meant by the Prepayment of Loan?
Prepayment of a travel loan online is a facility offered wherein a borrower can repay his or her travel loan before its actual repayment tenure as per the loan agreement. The prepayment can be done either in part or full.
Benefits of Prepaying Personal loan for travel
Since personal loans for holidays loans online are unsecured, they carry a high rate of interest. Hence if someone has surplus funds in his or her bank account during the repayment tenure of travel loan, it may be a good idea to prepay the loan in full or part depending upon the quantum of surplus funds available. Full prepayment or part prepayment helps in saving a lot of interest expenses depending on the remaining amount of principal outstanding, rate of interest, and tenure. Through part prepayment, you can reduce the amount of your future EMIs due to a reduction in principal outstanding.
Disadvantages of Prepaying Travel loan
- Prepayment Charges: It is the amount which the borrower is liable to pay when he or she repays the amount before the end of tenure. Prepayment charges charged by banks are around up to 5% of the principal outstanding.
- Losing substantial cash liquidity at once: Surplus cash can be needed for some other purpose such as medical emergency
Buddy Loan disburses travel loans
Whether to Prepay or not to Prepay
You should decide to prepay or not to prepay travel loans wisely. It depends on many factors such as interest rate, tenure, principal outstanding, prepayment charges, etc.
Also, some banks have a prepayment lock-in period during which you cannot pre-pay the loan. Usually lock-in period ranges from 1-3 years.
Buddy Loan offers Instant travel loans with attractive interest rates and no prepayment charges. It means that whenever you want to pay back the loan in full or part, no prepayment charges/penalties would be charged. Hence Buddy Loan is one of the best options for vacation loans online.
At times, taking a personal loan for travel may be a good idea even if you have enough savings in your bank account as Buddy Loan offers low-interest personal loans with flexible repayment tenure, and no prepayment charges. Hence, you can take travel loans and use your surplus funds for any other purposes such as investment, buying an asset, or god forbid in case of medical emergencies.
The uses of a travel loan!
Everyone loves to take some time off from their busy and monotonous daily routine to spend time in a foreign place with friends and family. Taking a vacation allows people to take a break from the monotony from life and rejuvenate themselves. For this purpose, many seek to take a personal loan for vacation purposes from financial institutes and loan-providing services like Buddy Loan, banks, and NBFCs.
By using such bank loans for travel, people can benefit in numerous ways and enhance their vacation experience considerably.
The following are some uses for an instant travel loan:
- Financing: by getting a travel loan online, people can easily finance their vacation without having to undergo the burden of a cash crunch. People will be able to enjoy their vacation without constantly having to worry about the monetary fund running out.
- Budgeting: An instant travel loan allows for a specific amount of money. People will be able to manage and budget their vacation appropriately by distributing the money across the requirement for the trip. This will help make an account of how much is being spent on necessities like travel and accommodation and will help create a separate fund for leisurely activities.
- Vacation planning: by taking a holiday loan online, people can choose a vacation plan that will fit within the monetary constraints of the loan taken. This lead to a more fulfilling experience during the vacation itself.
- Repayment: taking a holiday loan online means that the applicant can repay the loan amount according to his or her situation. A potential applicant for a bank loan for travel will not have to be worried about their credit score with institutions like Buddy Loan, as it is often a hurdle when it comes to instant travel loans. The borrower can repay the loan amount based on EMI, bi-monthly, annually, or even in a single payment if he or she is up for it.
People who look forward to going on vacation need not have to worry about financial constraints with the help of personal loans for travel purposes. This is one of the many reasons for which personal loans are highly popular for the common masses and people in business alike.
Many institutions like Buddy Loan also have added benefits of a personal loan for a vacation, which makes it even more advantageous for friends and family who are looking forward to having a lovely time on their vacation or tour.
Form 16 role in travel loan!
Whether you are backpacking across Europe or merely wandering on the roads of Bali with your camera, financial security is paramount to cover all the rip-roaring activities in all these far-flung places. One of the quickest and simplest ways to arrange funds is through services like Buddy Loan.
Buddy Loan App is all you need to get a collateral-free travel loan online through a seamless process at interest rates as low as 11.99% p.a. Once you have planned & created a trip budget, jump on to our instant travel loan service, which is entirely paperless and lets you get funds in your account within 48 hours.
We have processed vacation loans online across the country. In some cases, loans are approved before the expected time of 48 for people with great credit history.
The documents required to apply for a travel loan for salaried professionals:
- Proof of Identity: Driving License/ Passport/Voters ID/ Pan Card
- Proof of Residence: Passport/ Leave and License Agreement/ Utility Bill (not more than three months old)/ (anyone).
- Income Proof: Last three months’ bank statement reflecting the salary amount.
Form 16 is a legal document (TDS certificate) issued under section 203 of the Income-tax act. It is endowed by the employer to warrant the tax deducted from an employee’s salary if their salary exceeds Rs. 2.5 Lakhs before any deductions.
Your latest salary slips and bank statement should be proof enough to establish your financial stability for our comprehensive range of loan providers to accept your loan application.
However, form 16 is sometimes required while processing Visas. It is not necessary for you to furnish form 16 as proof unless you are self-employed.
Form 16, being an official document that is accepted by the governmental authorities, it is a document favoured by almost all banks and financial institutions to understand the level of income of the individual and the credit potential and repayment ability of the individual. Loans, where the EMI (equated monthly instalment) is of a higher proportion to the income, would mean a reduced ability to repay or even inability to repay the gold loan in certain circumstances.
For self-employed professionals, the documentation may differ, and you may be asked to furnish Income tax returns for the last two years with computation as an additional document to establish that you’re financially stable and independent to stay the time of your travel. In some cases, in the absence of income tax returns, you may be asked to submit form 16 (ITR 3 & ITR 4).
Does borrowing a travel loan affect my credit score?
Today’s generation likes to travel a lot to various destinations. Whether International or domestic travel, around 60% of Indian millennials travel two to five times a year. Buddy Loan helps you avail of the best travel loan with lower interest rates and better repayment options.
With so much travelling by Indians, banks and financial institutions offer travel loans at attractive interest rates. A travel loan is a cheaper form of credit than a credit card with quicker disbursement turnaround time, minimal documentation, and flexibility in repayment terms.
Like any other loan, personal loans for travel also affect the Credit score (CIBIL), and any single missed EMI will negatively impact the credit score.
So, in the middle of travel plans, one should not forget to keep the account funded for any upcoming EMIs. One should always remember to monitor credit scores regularly. This way, one can keep a tab on credit portfolio, see the score trends, and ensure that he or she is not taking more credit than can be responsibly managed. A travel loan affects credit score in the following situations:
When you Inquire about new Travel Loan:
It is not ideal for making multiple credit inquiries at the same time as they can take a hit on your CIBIL score. Credit inquiries account for around 10% of your credit score.
- When you apply for a Travel loan: When you apply for a loan, bank, or financial institution checks your CIBIL score. It is known as a hard inquiry. A hard inquiry downgrades your CIBIL score. Hence you should not make multiple loan applications.
- When you regularly pay your EMIs: When you make timely repayment of your EMIs, it is reported in CIBIL, and your credit score is improved.
- When you miss an EMI: If you miss the EMI by a few days, it may not affect your credit score, but EMIs overdue for 30 or more days affect the credit score badly.
- When you settle your loan: When a loan is termed as paid, CIBIL rating drops by around 75-100 points.
Few things to be kept in mind while availing a Travel loan so that you can responsibly manage your credit score
- Take that much only what you require
- Maintain an appropriate balance between your secured and unsecured credit exposure
- Check your repayment terms carefully
These days, travel loans online are instant and hassle-free, starting at low-interest rates. Instant travel loan approvals are straightforward. Buddy Loan offers personals loans for vacation. Buddy Loan offers more comfortable ways to avail holidays loans online than a bank loan for travel. It provides the following features.
- Digital and paperless application process.
- Collateral free Instant loan online.
- Flexible repayment tenures.
- Loan amount ranging from Rs. 10000 to Rs. 15 lakhs.
- Attractive Interest rates.
- Quick approval rate
- No Hidden charges.
Travel loan repayment
Personal loans are one of the more popular and more sought-after loan options by the majority of the public. This is because personal loans are a secure and risk-free method of securing financing for personal or business requirements. Buddy Loan is the best option for those who are looking to travel with a loan amount that has lower interest rates and better repayment options.
A wide number of people take personal loans for travel purposes, for that matter. This allows them to have an easier way to apply for vacation loans online have been able to travel to different parts of the world.
Avail travel loans at lower interest rates:
Though a primary concern for going to apply for a travel loan is the repayment of the loan, repayment of instant travel loans can be a daunting and drawn-out process, and many have difficulty knowing where to start. Luckily, loan providers like Buddy Loan have flexible and different repayment options for the repayment of travel loans online.
Repaying a Travel Loan
Repaying a travel loan online can be made into a simple task if one knows how to go about it and ensure that the repayment method that is opted for at the time of applying the loan lines up with the applicant’s future financial situation.
- Frequency: lenders like Buddy Loan have multiple prepayment options of the travel loan, be it monthly, bi-monthly, annual, or based on EMI.
- Tenure of the loan: depending on the tenure of the loan or EMI, the loan amount can be divided into parts making the payment in instalments a lesser burden and much easier. For example, if the loan amount is to be paid in 24 months and pay the amount accordingly. This substantially reduces the pressure of repayment.
- One-time pay: many providers for instant travel loans like Buddy Loan also accept one-time payment options. This means that the borrower can repay the entire loan amount in one payment. This allows the borrower to save a considerable amount on interest charged and also will reduce the time taken to repay the loan drastically and free them from their debt.
- Those looking to repay their holiday loan online can adopt any of these ways to repay their loan amount. Picking the methods that best fit your financial position and cash flow will help in the optimum repayment of one’s travel loan.
With Indians travelling much more than ever before, banks and financial institutions are now offering loans at lucrative interest rates. Travel loans are quickly emerging as the preferred credit option, being a cheaper form of credit than credit cards.
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