Is There a Personal Loan for a Sudden Holiday Plan?

Are you exhausted from your hectic work schedule and looking for some time off However, planning a last-minute trip is difficult and expensive. To ensure that everything goes smoothly, you must consider various factors when planning your finances for the trip.
 
But what if you are on a tight budget and need to travel urgently? Read this article to know how you can easily fund your sudden vacation plans through a personal loan. 

Can you get a Loan for a Holiday?

Financial institutions these days offer various financial products to cover your travelling expenses. Among these are credit cards, travel now and pay later schemes and personal loans. However, most borrowers prefer choosing a personal loan due to its repayment flexibility and a sufficient amount of funds. 

How to Avail a Personal Loan for Travel?

1. Pick Your Destination

Before you avail a loan for a holiday, you should first decide where you want to go for your vacation. Different places necessitate different planning. When travelling within the country decide whether you want to visit a hilly area a beach or a terrain region. Depending on the season some destinations may cost you more than others. Similarly travelling abroad may demand an increase in your funding requirements.

2. Explore Hotels

After you have decided on a location, the next step is to select the hotels or other lodging arrangements. Compare the rates and amenities provided by local hotels and resorts. If you are going to an unfamiliar location, see if the hotel has cab services. Check out any extra facilities, such as breakfast, laundry service and spa which are available for guests. Also, check how far the hotel is from famous tourist attractions at your destination.

3. Compare Airfare

Check out the different airline companies fares. If you find it time-consuming to visit the websites of each airline, you can seek assistance from any of the travel agents.  The websites of such companies provide detailed information on each airline's airfare, as well as their seat availability and schedules.

4. Prepare a List of Activities You Intend to Do on a Trip

Depending on your destination, you might want to engage in a variety of enjoyable activities. It could be paragliding, river rafting, or other exciting activities. Learn about the cost of such activities ahead of time to better plan your finances. You should also make a list of places you want to visit during your trip.

5. Finalise Your Lender

When you have completed the preceding steps and have a rough estimate of your trip, it is time to select a lender. When performing a comparison between various lenders, check the personal loan documents they require, minimum and maximum amount of loan offered, eligibility criteria, and interest rates.

6. Apply

After deciding on the lender, the next and last step is to apply for a personal loan. You can do this by visiting the nearest branch office of your lender or by applying online through their website. 

Things to Consider When Taking a Loan for a Holiday Trip

Before you apply for a Personal Loan to fund your holiday, keep these important factors in mind:

Amount Required

Investment in travelling counts as a leisure expense. Overborrowing or overspending the loan amount here will only increase your debt burden. As a result, it is recommended that you first assess your repayment capacity ,Understand how much of your income you can save after deducting the necessary expenses. Only proceed with your decision if you believe the balance amount can easily cover the loan EMIs.

Loan Tenure

When borrowing to cover travel expenses, pay close attention to the repayment period. Your loan interest rate and EMI are directly related to the term of your loan. In case you choose a shorter term, the lender may sanction funds with higher EMIs. On the other hand, longer tenure equates to lower EMIs but a larger overall payment towards the interest component. Thus, deciding on this point requires an in-depth evaluation of your budget.

Plan Your Expenses

Just as you would prepare a bucket list of places to visit, you should also prepare a list of every possible expense that could arise during a trip. This will assist you in understanding your funding requirements. It will also keep you from overspending. Your expense list should start with flight booking and include expenses for sightseeing, lodging and food, shopping, and reserves for dealing with uncertainty.

Insurance

There are several countries where tourists are not permitted if they do not have valid travel insurance. Among them are the United States, the United Arab Emirates, Cuba, Schengen countries etc. Even if you are travelling to countries other than these you must still purchase insurance. This is because an insurance protects you financially against unforeseen events such as a medical emergency loss of passport extended stay and so on. Insurance serves as a supplement to your loan.

Why Obtaining a Personal Loan for a Holiday is an Ideal Option?

• You can obtain funds without putting up any collateral. 
• The lender provides an option of selecting the tenure that best fits your budget. The repayment period ranges from 12 to 60 months.
• After the first twelve months of regular EMI payments, you have the option to foreclose the loan.
• A personal loan allows you to use the funds, not limiting you to traveling expenses only.

 Also Read: 5 Factors That Affect Your Personal Loan Eligibility

Tips to Use Your Personal Loan Wisely for Your Vacation

Follow these tips on the sensible use of your Personal Loan for your vacation.

1. Make sure to create a travel budget and stick to it.

Take a moment to create a budget that includes transportation, hotel/lodging, meals, activities, and miscellaneous fees (this will include shopping). While on vacation, stick to the budget as much as possible to reduce the chance of worrying about finances when you return home.

2. Include all aspects of your vacation in your budget, including emergencies.

There are many hidden costs associated with all travel; visa fees, travel insurance plus all the potential miscellaneous costs you could incur (everyone needs to plan for the likely to be unexpected medical needs). If you include a buffer you could be ready for what comes your way.

3. Find out your eligibility before applying and have the necessary documents ready.

Once you make the decision to look for a loan; find out your eligibility criteria before you apply. As you do more research, get yourself ready and have required documents in order and ready. Identity proof, income proof, address proof, etc. will help you obtain a loan faster and with less headaches.

4. Pay on time to maintain a respectable credit score.

You can set reminders or set up auto-debit so you can meet the due dates (EMIs). A late payment likely would be reflected on your credit history, potentially impacting your score, which could be a factor in obtaining future loans.

5. Use a loan EMI calculator and make financial decisions with ease.

An EMI calculator allows you to see what your EMIs would be based on: how much you want to borrow, the tenure of the loan, and the interest rate. This helps you make informed decisions and choose loans that fit your financial needs.

Also Read: A Step-by-step Guide to Getting Unsecured Personal Loans

Is borrowing necessary for a vacation?

Although Personal Loans can provide immediate flexibility to spend, don't let yourself be tempted to use them to pay for your trip without due diligence. Some of the options are:

• Long term consequences: While your travel memories may last forever, repaying a high-interest Personal Loan can become a financial burden.
• Payback plan: Always make sure you have a solid payback plan that limits your future financial burden.
• Comparative savings: Generally, it is important to budget and save for your trip.

Conclusion

A personal loan is ideal when you need funds for a last-minute trip and have a tight budget. You can apply for it online from the comfort of your own home with just a few clicks. The collateral-free personal loan funds can be availed up to Rs 5 lakhs with a flexible term of 60 months. However, before applying for this loan, always plan your trip budget to avoid overborrowing and overspending.

Frequently Asked Questions 

1. Can I get an EMI holiday on my Personal Loan?

Yes, you can easily get a Personal Loan for your holidays that you can pay back in equated monthly instalment or EMIs as per the agreed tenure.

2. What documents are needed to apply for a Personal Loan?

The documentation requirement for Personal Loan is minimal. At Hero FinCorp, you only need your KYC details and proof of income when you apply online.

3. How fast can I get the loan disbursed?

You can get approval for a Personal Loan in as little as 10 minutes when you apply on the Hero FinCorp website or loan app.

4. Is travel insurance mandatory with a Personal Loan for a holiday?

No, travel insurance is not mandatory when taking a Personal Loan for a holiday. You can consider it for added protection during your holiday. 

5. Can I prepay my Personal Loan without penalty?

Yes, at Hero FinCorp, there is no penalty for prepayment of the Personal Loan. Contact our customer care for terms and conditions.

6. How do I calculate my EMIs?

You can easily calculate your loan EMIs using the Personal Loan EMI Calculator online. It is a free-to-use tool that requires the loan amount, interest rate and repayment tenure for calculation.  

Disclaimer: The information provided in this blog post is intended for informational purposes only. The content is based on research and opinions available at the time of writing. While we strive to ensure accuracy, we do not claim to be exhaustive or definitive. Readers are advised to independently verify any details mentioned here, such as specifications, features, and availability, before making any decisions. Hero FinCorp does not take responsibility for any discrepancies, inaccuracies, or changes that may occur after the publication of this blog. The choice to rely on the information presented herein is at the reader's discretion, and we recommend consulting official sources and experts for the most up-to-date and accurate information about the featured products.

About Hero Fincorp

Hero Fincorp offers a wide range of financial products including Personal Loans for personal needs, Business Loans to support business growth, Used Car Loans for purchasing pre-owned vehicles, Two-Wheeler Loans for bike financing, and Loan Against Property for leveraging real estate assets. We provide tailored solutions with quick processing, minimal paperwork, and flexible repayment options for smooth and convenient borrowing experience.