Pros and Cons of the Online Travel Loan in the Philippines
Travelling is not only the dream of most people but also a trend of the recent years. Spending vocation in an exotic place, making photos in some “insta” places, this is what makes some people spend money. Others may prefer quite rest somewhere far from home or visiting relatives while being free from work. In any case, money is what makes it either possible or not.
It is good when the vocation is planned and you have saved enough money. But what if you have not enough cash? Is it possible to travel now, but to pay later? Yes, it is. Moreover, this type of personal loan is widely popular among Filipinos, who have a need to cover travel-related expenses, for example flight, hotel, etc. For the purpose of approaching money requirements while visa application, there is a special loan called travel assistance loan in the Philippines.
Travel loan, like any other type of personal loan, has its peculiarities. It attracts customers because of its low interest rates flexible repayment terms. Got interested? Let’s find out more.
Can I Get a Travel Loan in the Philippines?
To get a loan, you need to be approved. For that, you need to comply with the set requirements. Study them carefully before submitting application form. They might differ a little but some of them are mandatory among all lenders:
- Age. The borrower must be not younger than 18 y.o.
- Citizenship. Only Filipino citizens can be approved.
- Income confirmation.
Availability of collateral is the additional requirement used in some cases. If the borrower’s credit history is bad or there is no credit history at all, he might be ask for collateral as a guarantee. No income confirmation or/and collateral does not mean the rejection but the chances of getting a loan are much lower.
Another condition that can influence the decision is the presence of debt on other loans. Before applying for a travel loan, make sure you have repaid the previously taken loans.
Calculate How Much You Need for a Travel
Before you even start thinking about getting a travel loan, you need to figure out how much money you need for your travel. Take a piece of paper and write down all the travel-connected expenses:
- Flight (gas, bus or train tickets, etc.),
- Hotel (apartment, hostel),
- Accommodation (transportation, food, excursions, etc.),
- Travel insurance (if needed),
- Extra money.
The Value of the Travel Loan Must Be Reasonable
When the first calculation is done, think of the possibility of cutting the expenses. Estimate your earnings and understand what kind of vocation you can afford. Is it cheaper to go by train instead of going by car? Maybe you can choose a hostel, not an expensive hotel? Learn the final number and compare it with the sum you have. The difference is the value of the travel loan you need to take.
We recommend to borrow slightly more than the actual amount, as there are always expenses left uncounted. This will prevent you from spoiling your vocation. If you still have time before the travel and the sum you need is not very big, try to earn it and save money. This way you will not have to pay the interest.
Conditions of the Travel Loans in the Philippines
Travel loan has a high rate of approval, compared to other types of personal loans. There can be specific peculiarities depending on the financial institution but the standards are pretty common.
- Term of the loan – up to a year;
- The amount – up to PHP 300 000;
- The interest rate – fixed.
These conditions are not always beneficial for the customer, that’s why you need to compare them carefully before signing the papers. The better credit history you have, the higher your chances are and the better conditions you get. Customers with a bad credit score have a risk of being rejected. The interest rate may also depend on the level of income and citizenship.
How Can I Get the Money?
When your application is approved and it’s time to get your funds, you have 3 options:
- The money can be sent to your bank account;
- You can receive it in cash in person;
- The funds can be transferred to your credit card (Visa or MasterCard).
Everything is that simple, the choice is yours. There are also financial institutions, which use electronic payment services. To receive money in such a way, you need to correctly specify your personal information. Choose the way, which is most suitable for you.
Be Ready to Repay the Loan
When you borrow money, you need to remember that you will have to return it. That is why it is important to count everything beforehand and estimate your possibilities. For this purpose, review your monthly income and spending. Consider if you already have open loans.
Will you earn enough to repay part of the loan every month? Do you know that the sum you pay should not exceed 30% of your earnings?
Carefully examine your savings and balance on the credit cards. Maybe you have enough money and do not need to borrow. If your financial situation is too difficult, think about postponing of the travel. In general, make sure your travel is worth borrowing money for. Going to the wedding or funeral, for example, can not be moved in time even if you have no money at the moment. For this purpose, you have people apply for the travel loan.
Compare Travel Loan and Credit Card for Travelling
No one knows your needs better than you. Knowing your situation permits you to make the right choice of the way of getting funds for your travelling. Note, that you can seek professional help to get advice.
While travelling, taking a travel loan is not the only option. There are other ways of financing your vocation. Your existing credit card is one of them. If you are going abroad, dual-currency credit card is a good option. There are also cards with no foreign currency transaction fee. You need to understand that there are choices. Consult with your bank employee and ask which one is most beneficial in your particular case.
Compare them by:
- interest rates,
- monthly amortization,
- possible money-saving perks,
- how much you can borrow,
- repayment value.
Travel loans in the Philippines are issued by different banks and financial organizations. For an ordinary person, it’s hard to make the right choice. If you need help, you can use an aggregator online.