How to apply for personal loan

Knowing what you’ll need to pay in terms of processing fees and other charges on your personal loan for travel will help you plan for the loan better. Here’s a list to keep in mind.

It is always good to know what a loan costs before applying for it. While knowing your EMI is one part of this, being familiar with the other fees and charges makes up the other half. An understanding of what exactly your loan entails will help you manage your finance better and repay the loan conveniently. This guideline applies to a personal loan for travel as well.

Listed below are some charges that you must bear when you apply for a Personal Loan for Travel:

1. Processing fees

This is the fee that is charged for processing your application. It is a representative of all the costs involved while sanctioning your loan. It includes everything right from the cost of undertaking the verification process to actual administrative expenses.

It is usually up to 3.93% of the loan amount (inclusive of applicable taxes). You have to pay this fee at the time of signing the loan agreement.

2. Interest rate

This is the interest that you pay the lender in exchange for the funds that are lent to you. Essentially, it is the cost of availing credit.

This fee starts from 10% p.a. and has to be paid on a monthly basis. It is part of the EMI amount that you pay every month.

3. EMI bounce charges

Rs. 700 to Rs. 1,200/- per bounce

“Bounce charges” shall mean charges for (i) dishonor of any payment instrument; or (ii) non-payment of instalment (s) on their respective due dates due to dishonor of payment mandate or non-registration of the payment mandate or any other reason.

4. Penal Charge

Delay in payment of instalment(s) shall attract Penal Charge at the rate of up to 36% per annum per instalment from the respective due date until the date of receipt of the full instalment(s) amount.

5. Foreclosure charges

Foreclosure often puts the lender’s interest at risk. So, this fee is sometimes charged when an applicant wants to foreclose the loan before the tenor lapses.

This fee is up to 4.72% (Inclusive of applicable taxes) on the outstanding loan amount as on the date of full pre-payment

Additional Read: 5 important things to know before taking a Personal Loan

6. Part prepayment charges

When an individual makes a part prepayment towards the personal loan, the lender stands to lose out on interest.
So, the lender usually charges up to 4.72% (Inclusive of applicable taxes) of the principal amount of Loan prepaid on the date of such part Pre-Payment.

7. Annual maintenance charges

As the name suggests, this is a charge that is passed on to you in exchange for maintaining your account. These charges are billed to you on an annual basis. Following are the details of the AMC charges -

• (Term Loan: Not applicable
  

• Flexi Term (Dropline) Loan:

Up to 0.295% (Inclusive of applicable taxes) of the Dropline limit (as per the repayment schedule) on the date of levy of such charges.

• Flexi Hybrid Term Loan:

Up to 0.472% (Inclusive Of Applicable Taxes) Of The Dropline Limit During Initial Tenure. Up to 0.295% (Inclusive Of Applicable Taxes) Of Dropline Limit during Subsequent Tenure

Knowing about these charges in advance can help you plan your holiday without any unplanned surprises. Visit your dream destination with the help of a Travel Loan offered by Bajaj Finserv. It offers you a range of benefits such as flexible prepayment options, customisable tenor, and a nominal interest rate.

Additional Read: Overdraft Vs Personal Loan

Additional Read: The different types of loans available in India