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01 JULY, 2022
So you are ready to check off the next destination on your travel bucket list? You have your itinerary planned, wardrobe decided, and photo ops all figured out? If financing your holiday is the only thing left to do and you are considering a personal loan for that, then you’re on the right track. Just make sure to keep these things in mind while you apply for a holiday loan with Kotak Mahindra Bank:
1. Don’t cross your budget
The thing about travelling is that often, the same destination can be done in a budget of Rs 50,000 or Rs 2.5 lakh. It all depends on what kind of accommodation you are opting for, when and how you book your flight tickets, what you choose to include in your itinerary, how much shopping you plan to do, etc. When you are taking a personal loan for travel, it can be tempting to apply for the entire amount that you are eligible for and splurge on your holiday. But that is not prudent. Instead, you should first draw up a budget for your holiday which aligns with your finances and then consider how much of your holiday can be funded by your savings. Then, accordingly, you can take a travel loan for the excess amount.
2. Choose the tenure wisely
Usually, a travel loan comes with a loan tenure of 12 to 60 months. This means that you can repay the loan over a period of up to five years. While such a long tenure would mean a reduced Equated Monthly Instalment (EMI) burden every month, it would also result in higher interest outgo. This is because the longer the loan tenure, the more the interest burden is. Hence, you should carefully consider what is the shortest amount of time in which you can repay the loan without finding it difficult to meet your EMI obligations or defaulting.
3. Check your credit score
Before you apply for a personal loan for travel, it’s essential that you check your credit score. Here, it’s not just important to see whether you have a high score or not but also to check your credit mix. If you already have several unsecured loans – loans without collateral – such as credit card loans, personal loans, etc., then you may not want to apply for an additional unsecured loan before paying your current debt off. This is because a higher number of unsecured loans as compared to secured loans in your credit mix can negatively impact your credit score. This may become problematic in the future when you want to apply for a loan, especially in case of emergencies.
Applying for a personal loan for travel with Kotak is easy. You can simply click on the personal loan apply online button and, with minimal documentation, get the funds disbursed within seconds. To get an idea of how much the personal loan would cost you for your travel, you can make use of Kotak’s online personal loan EMI calculator. This will help you get an estimate of what your monthly debt obligation will look like for your next holiday.
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