Technology has made it possible to identify the world’s needs at the fastest rate in the history of humankind. One such need that surfaced in current times of inflation and job shortage was the need for recreation. A vacation is undoubtedly the healthiest form of recreational break that a person can take to give their lives a pause from the daily grind of work. Unfortunately, in the present economic climate, a vacation is closer to a dream than a reality for the masses.
If you are tired of constantly checking your bank balance and returning disappointed after seeing that your savings never suffice for your well-deserved vacation, you no longer need to wait! Travel loans exist and can help you finance your vacation more quickly and efficiently. A travel loan is a short-term advance loan.
What’s a travel loan?
A travel loan is money borrowed from a bank or any other lender to travel. In other words, when your savings amount can’t cover the expenses you incur while on vacation, a travel loan will be the kind of financial assistance that can aid you in fulfilling your dreams. On many grounds, they are similar to personal loans, but what differentiates a travel loan from a personal loan is its faster processing and approval time. Moreover, with a travel loan, you would have greater clarity on the estimated cost you would need to borrow.
Depending on the lender, a travel loan can cover the prices of your flight tickets, accommodation, insurance, and any other significant expense. Thankfully, nowadays you can get approved loans online.
Personal loans and travel loans have a lot of similarities:
- They don’t require collateral: like personal loans, you don’t need collateral to avail of a travel loan unless you’re borrowing a significant amount. But bear in mind that the limit of a ‘large amount’ will differ from lender to lender.
- They can be availed online: like instant personal loans, various banks and private lenders let the borrower apply for a travel loan online. Moreover, the entire process, from applying for a loan to getting the requested amount in your bank account, can be done entirely online. Furthermore, many types of loans, such as salary loan, or gold loans, can be availed online.
- Minimal documentation required: In addition to being available online, travel loans can be approved with just the essential documents that confirm your identity and income.
- They may have a low-interest rate: it depends on your credit score and the repayment tenure you choose. Generally, you can expect lower interest rates on travel loans.
- Similar repayment tenure: like personal loans, the tenure period for a travel loan can be anywhere between 12 to 60 months. They’re an emi loan.
At this point, you may argue that a credit card can also provide the same services as a travel loan, so why specifically opt for a travel loan over continuing with your regular credit card? Here’s why: a credit card comes with high-interest rates and higher processing fees, and you might have a lower credit limit if your income is low. Additionally, you need to enable foreign transactions if you’re traveling abroad.
These problems are eliminated when the borrower proceeds with travel loans as they come with lower interest rates, and people can do online transactions more smoothly. Furthermore, you would have the assurance that you can only spend up to the amount you’ve requested.