As tourist websites around the globe resume their daily operations and begin accepting visitors post-COVID-19 pandemic, one thought which may have come to your mind is that ‘I want to travel as well as enjoy the vacation’.
However, among the various ill effects of the COVID pandemic, one that outlasted extremely is how it negatively impacted your earning potential and drained down your savings. Thus, chances are though most of you want to witness a vacation, you are restricted by funds. But fortunately, these days, you can easily apply for an instant personal loan and use this amount to finance your dream vacation. Here in this post shared is all the processes you must know about availing a personal loan –
What’s a personal loan?
One of the most crucial aspects we ought to understand is what a personal loan is. In simple terms, a personal loan is a financial instrument, which can be used to borrow a specific amount of money, usually ranging between Rs 50,000 and Rs 40 lakh and repay them through flexible repayment plans and at the same time enjoy competitive interest rates.
However, one of the important features of a personal loan depends on the fact that lenders do not put any restrictions on how you must spend the loan. Once you receive the loan amount in your bank account, you can simply use them for anything, right from making payment of your car down payment to paying for a vacation. Before availing of a personal loan, ensure to check its interest rate. For instance, the SBI personal loan interest rate 2022 ranges anywhere between 10.30 % p.a. and 13.30 % p.a. To calculate your accurate EMI on personal loans, you can resort to SBI personal loan calculator 2022. Such calculators compute EMI based on the required loan amount, expected interest rate and preferable repayment tenure.
How can you use your personal loan for vacation?
Now you know the personal loan concept, let’s dive deep into knowing how you can use it for vacation. As discussed previously, the prudent aspect of a personal loan depends on the fact that you can utilize the loan proceed for anything, which means you can use it for paying for your vacation. To get the best personal loan for a vacation, ensure to follow the simple steps outlined below –
∙ Go to the Play store and download the lender’s app from where you want to avail of the loan.
∙ After you locate this, just download and install it on your phone.
∙ Initiate the application procedure by initially sharing your name, Aadhaar card details, phone number etc. Ensure to share the phone number that is registered with your Aadhaar card.
∙ Once done, move ahead to complete your remaining application procedure by sharing your personal details like your current address, residential address, PAN card details and email address.
∙ Move ahead with your application by sharing your work details like your employment kinds, overall business vintage, monthly in-hand income, organization’s name etc.
∙ Once you are done with your application, the lender will evaluate your personal loan application and take the call on whether to approve your request.
∙ After approval, all you must do is apply for the loan of your choice, and in just the new few days, you will get the loan proceeds in your savings bank account.
∙ Additionally, the personal loan application will display your loan amortization schedule, i.e., the EMI amount that you must pay each month and the consecutive payment date.
The best part about placing an application for a personal loan is the fact that once your loan proceeds are delivered to your account, your EMI will begin, and you can make the repayment through any of the preferred gateways right from your debit card, UPI, net banking, or mobile wallet.
The aspect you must note –
Now that you are aware of how you can make the most of your personal loan to pay for your vacation, there are various aspects you must note.
Not free money –
When you are in immediate need of funds, one important thought which could come to your mind is that a personal loan is certainly not free money. While lenders charge you an interest rate, you still are under a legal obligation to repay your EMI proceed every month, and this is computed after factoring in the interest constituent being charged on your personal loan.
Thus, before you place an application, make sure to engrave in your mind that a personal loan for vacation is not free money, and you must repay it regularly.
EMI repayment –
In consideration of the previous points, in a few scenarios, borrowers mostly forget their equated monthly instalment repayment dates. May it be a careless mistake or forced habit, it can have an extremely negative impact on your thorough financial health.
For example, if you miss out on your repayments even for 1 month, you will witness late payment fees and additional interest, while if you miss out on the same for 4 consecutive months, this will be reported to the credit bureau, leads to an extreme downgrade of your credit rating. One of the best ways around this is to opt for an NEFT mandate. This way, lenders can easily deduct your EMI automatically from your bank account each month on a stipulated date, and you will never fail to pay your obligations.
Change in your credit score –
Lastly, as your personal loan from the lender is unsecured in nature, you are not required to pledge your collateral or asset to avail of the loan features. This essentially converts to the fact that the impact of it on your credit score is higher. It means that if you repay your EMIs on time, your score will continue increasing; however, if you miss out on your payments, your score may take a hit and subsequently, your potential to get the credit instrument features in the future.
Ending note –
Today, placing an application for and subsequently getting your personal loan approved has become simpler than ever before. All thanks to the emergence of crucial personal loan apps, which leverages AI technology. Moreover, the best part is that you can simply use the application to finance your vacation.
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