Need Quick Cash? Here’s How A Gold Loan Can Help
One of the best ways to get fast money when you need it is through gold loans.
Your gold jewellery isn’t just a prized possession—it can also be a financial safety net. Instead of letting it sit idle in your locker, you can use it as collateral to secure a loan. A gold loan provides quick access to cash, and once you repay the loan, your gold is returned to you.
What is a Gold Loan?
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A gold loan is a secured loan where you pledge your gold jewellery to a bank or financial institution in exchange for funds. The loan amount is determined based on the value of your gold. After repaying the loan along with interest, your jewellery is safely returned.
Key Features of a Gold Loan
– Quick Approval: Since gold is a tangible asset, banks can easily verify its value and approve your loan swiftly.
– High Loan-to-Value Ratio: Depending on the lender, you can borrow up to 75% of your gold’s market value.
– No Credit Score Dependency: Unlike personal loans, your credit history plays a minimal role in approval.
– Flexible Repayment Options: Choose between monthly EMIs or bullet payments (a lump sum at the end of the tenure).
– Lower Interest Rates: Gold loans generally offer lower interest rates compared to personal loans.
– Short-Term Commitment: Loan tenures typically range from 6 months to 2 years.
– Secure Storage: Your gold remains safe with the lender until the loan is fully repaid.
– Versatile Usage: Use the funds for business expansion, education, medical emergencies, or any financial need.
What are the steps to apply for a gold jewellery loan?
A gold loan is available to anyone who possesses gold jewellery. You must be at least 18 years old and have basic documentation, such as proof of address and identity.
Seek out a lender that provides gold loans by visiting a bank or NBFC.
The lender will weigh and examine the gold’s purity.
The loan amount is approved based on the valuation.
Following the signing of the contract, you will receive the funds in cash or your bank account.
Things to keep in mind before taking a gold loan
– Interest rate: It is important to check and compare rates offered by various lenders.
– Processing fees: A nominal processing fee may be charged by certain lenders.
– Terms of repayment: Select a payback plan that works for your budget.
– Gold safety: Verify that the lender has safe places to keep your gold.
-Unexpected fees: Before you sign the loan contract, review the fine print.
According to the loan-to-value (LTV) ratio, the RBI permits lenders to offer up to 75 per cent of the market value of the gold.
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