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Gold Loan India The Real Benefits of Availing A Gold Loan

Gold Loan in India isthe next trending finance assistance that is availed by many people. Every person in need of money can avail a gold loan from non-banking and banking institutions by pledging their gold as security or collateral.

It can be taken for various purposes like marriage, child's education, business expansion, medical treatment, etc. You can get a gold loan quickly at nominal rates as it requires less documentation.

The loan amount depends on the current market value of the gold upto 80%. Gold loan offers a vital source of income at times of crises. Nevertheless, there are certain benefits that you can reap from gold loan.

  1. Quick processing

The prime benefit of the gold loan is you can apply for gold loan hassle free. Also, the processing time is faster compared to most other types of loans. As it is backed by physical gold, bankers are usually happy to lend a loan.

This is because, in case of any default, the financial institution can immediately sell the gold in the market. Therefore, banks immediately start the loan disbursal process.

  1. Effortless repayment procedure

This is another reason why a gold loan is a better choice. Its unique feature lets the borrower pay the interest beforehand and the principal amount later or during the loan's closure.

This feature attracts a lot of buyers and makes it simple to repay.

  1. Comparatively low interest rates

Since a gold loan is a secured loan, it charges lower interest rates. On an average interest rate on personal loans range from 15 percent to 18 percent. However, for a gold loan, it starts at 13 percent.

As an average Indian can get a gold loan with the lowest interest rate, it is the most preferred choice of many.

  1. No processing fees

Since gold loans are processed and disbursed immediately in exchange for physical gold, most NBFCs and banks waive off the processing fees. This is because physical gold is considered collateral which the bank already keeps with itself for a particular period.

  1. Low credit history? No worries

When you wish to avail a loan, financial institutions usually look for credit history. If you have a low credit history, your loan is rejected. However, for a gold loan, there is no such thing required.

The person availing a the gold loan has to deposit physical gold as security, and hence credit history is not looked at.

Gold Loan India The Real Benefits of Availing A Gold Loan

Who can apply for a gold loan?

Any businessman, salaried person, a homemaker can apply for gold loan hassle free. However, to get a gold loan at the best Interest rates, there is a certain eligibility criterion.

  • A person should be of age 18 years and above.
  • An individual should be ready to pledge his/her gold as security against the loan.
  • Banks or NBFCs require gold of 18 carats and above to be kept as collateral.

Documents required

The fastest gold loan disbursal process is quite simple. The lender can grant you the loan on the same day if you have the following documents.

  1. PAN card or Aadhaar card as identity proof
  2. Duly filled application form
  3. Electricity bill or passport as address proof
  4. Passport size photographs
  5. Signature proof

 Conclusion

Gold loan is a very reliable loan option. This is because even if the value of gold changes during your ongoing loan, you do not have to make up for the difference in the amount. Your amount of pledged loan remains fixed.

The best way to get a gold loan is by comparing the features, benefits, terms and conditions and rate of interest offered by various companies.

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