Know about your savior at all times: Gold Loan

In times of financial crisis or disaster, what exactly do you look for? We believe it would probably be having the money in hand to address the situation which has arisen due to the financial crunch. Today, one of the easiest ways to get money is by taking a loan, which is available on simple terms & conditions. Banks and NBFCs offer a particular loan for every situation. For instance, there are education loans for meeting the financial requirements for completing higher studies; to own your dream house, there is the Home Loan; or if you need to take a loan for any personal reason, there is the option of availing a personal loan.

Now, while all these types of loans offer the necessary monetary assistance to the borrower, they also come with certain terms and conditions, which everyone may not be able to comply with.

And then there’s a secured form of loan where the only point of eligibility is owning the monetary asset against which your loan will be secured; yes, we are talking about a Gold Loan.

Deemed a commodity whose market movement is similar to a currency, Gold is an auspicious purchase that is made generally during occasions, and in many cases is passed on from generation to generation.

Know what a Gold Loan is

A Gold Loan is a type of loan which is given against the collateral of gold jewellery, and can be availed for any purpose, be it marriage, studies, financial problem or any other personal reason. Over a period of time, people in need of money have started to rely upon this type of loan, for they believe instead of keeping the gold at home or in the bank lockers, it is better to use it for meeting the monetary requirements (without the need of selling and parting away with it). Come to think of it, gold is one of the ‘strong’ assets that anyone can own, so when taking a gold loan, you are essentially making your asset ‘work for you’.

Suggested Read:A Beginner’s Guide To Gold Loans In India

Why should you prefer a Gold Loan? 

Here is the list of reasons that make applying for a Gold Loan a superior option: –

• Gold loan is considered to be the most simple and convenient form of loan because by pledging your gold, you can obtain up to 75% of the market value of the gold as a loan.
• To get a Gold Loan, an intended borrower doesn’t need any proof of salary or income or a good CIBIL score.
• To obtain a Gold Loan, one requires only the most basic documents like identity proof, address proof, signature proof, and passport size photographs.
• Gold Loan is offered at lower interest rates as compared to Personal Loan by market leaders like Muthoot Finance.
• The processing time of Gold Loan is much quicker; it takes from a few minutes to an hour to get an approval for a Gold Loan, making it the best option when in immediate need of money.
• There is no pre-payment penalty.
• Gold Loan providers charge nominal loan processing fee. Valuation charges are also charged from borrowers, but in the case of Muthoot Finance, which has in-house team of valuators, the valuation charges do not apply.
• The option of Agricultural Loan against gold is also available for agriculturists at a nominal rate of interest.