In India, gold has traditionally been considered one of the safest stores of money. There is hardly any Indian household that does not own gold, whether in bullion or jewellery. It is not only a safe place to put your money, but it is also one of the most liquid investing options.
You can sell the gold on the open market to raise funds for unexpected expenses. However, because most Indians have an emotional attachment to their gold, selling it is not a popular alternative. Taking out a Gold Loan from a gold loan finance company is a better option in this circumstance.
What is a gold loan, exactly?
A gold loan is a type of secured loan given by financial organizations. The owner of gold bullion or jewellery agrees to pledge the yellow metal to the lender. Typically, lenders will lend up to 75 per cent of the gold’s worth. The value is calculated using the current gold rate in India. The remainder of the valuation is held as a margin to protect against market price fluctuations.
Gold Loan Interest Rates are significantly cheaper than Personal Loan and Credit Card Interest Rates because the product is a secured service. The maximum amount accessible as a Gold Loan from a gold finance company is normally uncapped, though this policy may vary between lenders.
Why is Gold Loan one of the most effective ways to meet your financial requirements?
You need money right away whenever you have a financial emergency. While applying for Personal Loans or other secured loans can take several days, applying for a Gold Loan is one of the most suitable solutions available. The following are seven solid reasons why a gold loan proves to be the best for your financial needs:
- Quick and easy
It is one of the most advantageous aspects of gold loans. The application process and disbursement time are both quick and simple. The documentation necessary is modest, and you will not be asked to carry a large number of documents.
All you have to do is bring your KYC paperwork (address proof and ID evidence), your PAN card, and the gold you wish to deposit to the gold finance company’s branch.
Large gold finance businesses, such as IFL Housing Finance, disburse the entire cash in a matter of minutes, depending on the loan amount. The exact amount to be paid will be determined once the financial institution has completed the mortgage evaluation. Amounts ranging from 70 to 75 per cent of the gold’s worth are offered by financial institutions.
2. Large Amount at Low Credit Score
A gold loan is one of the few financial instruments that allow you to borrow a substantial sum of money with a low credit score. The value of gold maintained as a mortgage reduces the amount of risk involved in this arrangement dramatically. As a result, financial institutions are willing to extend larger loans to customers with poor credit scores.
Because the value of gold is much higher in the markets than any other asset, the amount obtained through a loan against gold is also significantly more than other mortgage loans.
3. Payment Flexibility
One of the most appealing aspects of a gold loan is repayment flexibility. You won’t have to pay any fixed EMIs, and you can repay the loan in modest increments throughout the payback period, depending on your financial situation.
4. Attractive Interest Rates
In comparison to any other lending product, gold loans have substantially lower interest rates. Using an online gold loan EMI calculator, you can calculate the final interest rate on a gold loan. The risk connected with the loan is significantly reduced when gold is used as collateral. As a result, financial organizations are willing to lend money in exchange for gold at substantially lower interest rates.
5. Extended Tenure of Repayment
The payback period for a gold loan can be extended by up to 30 months. It’s also one of the many appealing qualities of a gold loan, as it relieves the borrower of the stress and pressure of repayment.
6. Gold Storage Safety
When you apply for a gold loan with IFL Housing Finance, you can rest certain that your gold is in good hands. It’s the equivalent of putting your unused asset to work. Lenders maintain gold security, and if your gold is stolen, your lender is responsible for reimbursing your losses. As a result, you can protect your assets by taking out a gold loan and repaying it over time.
7. Minimal Fee and Charges
Gold loans are preferable to personal loans because they have no prepayment penalties and a low or no processing fee. Furthermore, there are no fees associated with foreclosure, and you can return your loan without incurring any costs. As a result, you won’t have to pay any hidden fees to take advantage of gold finance.
Conclusion
Applicants can benefit from gold loans in a variety of ways. It enables you to obtain the appropriate credit on the spot and put the funds collected to your use. It has several advantages, which are stated above. The interest rates for gold loans at IFL Housing Finance start from a mere 0.89% for 30 days, much lower than those offered by most other private lenders. Before applying for a gold loan, you can look up the interest rates online and compare them with our competitors to determine the best loan company in India. So, the next time someone asks you if you know about any affordable and economical gold loan in Delhi, you will know where to point at. Contact Us for further details regarding our services.