The golden gift, gifting gold has a significant value in India. When it comes to weddings, the yellow metal is one of the most integral parts of ceremonies. Not just for gifting or storing gold in various forms such as coins, bars, jewelry, etc. It is also an essential form of investment for meeting multiple personal and business needs. A comparative study about the Today Gold Market can be conducive.
What is a gold loan?
Banks and various non-banking institutions provide loans to self-employed and salaried professionals against the security of gold and are known as a gold loan. The lending institutions offer gold loans depending on the value and purity of gold for a tenure of 1 day to 36 months. Banks also charge a processing fee up to 2% of the loan amount on a gold loan.
How can you get a gold loan?
You can either take a gold loan by directly contacting the bank or non-banking institutions or else you can take a gold loan through any online marketplace. Taking a gold loan through online marketplaces has its benefits. You can compare the gold loan rates of various institutions, thus can get the loan at attractive charges.
NOTE: Be very cautious at the time of taking a loan. There are many cases of fraud. Banks and NBFCS are my first recommendation. A third party is safe after complete analysis and a prior check is done.
A step-by-step guide to take a gold loan through the online marketplace:
- Choose the best lending institutions through the mobile app or official website of any marketplace such as BankBazaar, Myloancare, Policybazaar, etc.
- Next, the bank representative will contact you and explain the process and documents you would require to take a gold loan.
- Once, they schedule a meeting with you at the nearest bank branch, and you will visit the bank with your gold.
- Next, the bank will test and value your gold and based on the value of the gold, and you will be provided with the loan. If the value and purity of the gold are substandard, you will be given a loan of a lower amount.
- As the terms and conditions of the loan are determined, the bank will sell your gold in a packet under CCTV recording and kept safely in lockers.
- Finally, the bank will issue you a disbursement letter with the loan amount and other details duly signed by you and the bank authority.
What are the benefits/ features of a gold loan:
No credit history:
If you have a lower credit score, then you can easily avail a gold loan as you don’t require any credit history to take a gold loan. In the case of other loans, there is a long tedious process. For Gold Loan, the process is quite easy.
The process of getting a gold loan is easy, and you require minimum address and identity proof. Banks do not ask for any income proofs in case of a gold loan. As it is a form of secured loan, the gold at a larger level speaks about everything.
The process of repayment of a gold loan can be done using flexible methods such as bullet repayment, EMI scheme, etc. You can either repay the gold loan by paying the principal amount and interest together or pay interest at the end along with the principal amount of gold loan.
Please only take the loan when you have a strong financial position. In the case of non-payment, the banks have the full right to steal the gold. The gold will be sold and the money will be retrieved back.
No restrictions on end-use:
You can use the funds for any purpose such as travel, medical expenses, or for the wedding. A gold loan can sometimes act as your loan and can be termed as a multi-purpose gold loan.
The interest rate on gold loan: Presently, Canara Bank provides gold loans at the lowest interest rate of 9.10%. They also charge a processing fee of 1% of the loan amount. Some other top lending banks which provide gold loans at nominal interest rate are SBI bank, IIFL bank, and Axis Bank.
Must make a note that never sells your gold jewels, your gold jewels are assets and can be used for many purposes. Use and reuse your gold. Do good research and always study about your gold. Higher will be the value, higher will be the returns.
Compare different interest rates for different banks and make the best choice.
Getting in touch with a financial adviser is a good thing to do. As a whole, a gold loan is a safe, easy, flexible, and affordable option.
Avoid adding extra shimmer on the gold. The rustiness of the gold will fetch a higher value. Keep it simple and original.
As life is uncertain, we all must possess some form of resource with us.
Also, there is no restriction as to who can opt for a gold loan. Anyone who has gold can opt for a gold loan. From a student to a housewife until a farmer can get a gold loan. 70 percent of the total value of gold will be allowed as a gold loan. In case you are looking for a fast disbursal, go for a gold loan, and get quick cash.
Gold is always poured, cherished, bought, and decorated on every auspicious festival. So, gold even in the form of a gold loan is considered to be a good omen.
No need to hold on to your dreams. Take a loan today and get the money. Save, plan and be safe. Be a smart investor who is aware and informed about the pros and cons, the glitz, and edges about its gold. Hold a sharp sight and maximize your returns through the gold loan. Avail an online gold loan today. Stop the wait and don’t delay or miss this chance.
Thus, a gold loan allows you to utilize your gold in times of urgent expense requirements and financial contingencies at a rate lower than a personal loan rate.