Address Your Funds Requirement by Choosing The Best Gold Loan
Gold loan is a unique financing method that is secured and entails no restrictions on its usage. Owing to its host of benefits, individuals can leverage them and address any financial obligations without restrictions. This has amplified the popularity of this financial product significantly. Moreover, As per World Gold Council, the Indian gold loan market is estimated to grow by almost 250% to $105bn by 2024.
However, choosing the best gold loan requires proper homework and research. Moreover, individuals should also know the features of this loan before applying to make an informed decision.
Features of the Best Gold Loan
Here is an outline of the advantages that this financial product entails and helps you to meet any requirement of funds –
- Quick loan processing
One of the notable perks of availing of a gold loan is its quick processing time. Individuals can further streamline this process by applying online. After the gold appraisal, lenders approve and disburse the sanctioned amount directly to the applicants’ account.
Typically, this process takes a few hours to complete, which allow individuals to raise funds during any financial emergency
- Simple eligibility
Individuals only need to fulfil some simple eligibility criteria to secure the best gold loan scheme. Although any individual that possesses gold jewellery can avail of a gold loan, it requires them to meet certain lender-specific requisites like –
- Applicants must be Indian citizens
- Age should range from 21 to 70 years
- Salaried/self-employed/traders/farmers and everyone else is eligible
Individuals should also assess their monthly income to ensure an uninterrupted repayment and improve their eligibility.
- Credit score is not mandatory
Intending borrowers can qualify for the best gold loan scheme without maintaining a high credit score. In most cases, lenders do not check the credit score before extending a gold loan. Hence, individuals with poor or no credit score can also qualify for a substantial loan amount.
On the other hand, individuals can also improve their credit score by repaying this advance responsibly.
- Repayment flexibility
The best gold loan also accompanies flexible repayment options. Individuals can select any of the options below as per their repayment capacity.
- Repay the interest upfront and principal later before the tenor ends
- Choose a regular monthly instalment regime
- Repay the interest periodically, and the principal later
It also helps individuals to clear their debts as per convenience.
- Doorstep documentation
NBFCs like Bajaj Finserv also offer doorstep services for an online gold loan that lets borrowers avail of funds without leaving home.
The lenders send representatives to the applicant’s home or office for gold appraisal, collecting documents and completing other formalities.
- High sum
The best gold loan lenders offer a substantial amount to eligible applicants. However, it depends on the weight and purity of gold and the LTV a lender offers. The current gold loan LTV is capped at 75%.
Suppose an individual decides to pledge gold articles worth Rs.5 lakh and the LTV offered to that borrower is 70%. In this case, the maximum sanctioned amount would be Rs.3,50,000.
- Affordable interest rates
One of the most notable features of a gold loan is its interest rate, which is comparatively lower than its unsecured counterparts offering similar advantages. It helps individuals to clear their debts faster. After considering a few factors like gold purity, monthly income, loan amount, etc., lenders decide the interest rate.
Besides competitive interest rates, individuals can maximize payable interest savings by opting for a part-prepayment facility. They can also use a gold loan calculator and compare the interest rates of different lenders to get the best deal.
- Nominal additional charges
If you are looking for the best gold loan, you should look for a lender that imposes nominal to zero additional charges on part-prepayment and foreclosure. Eligible candidates can also apply for a top-up loan without additional charges.
- Free gold insurance
The best gold loan lenders also provide complimentary insurance for the pledged gold against theft and misplacement. However, the insurance plan is valid only for the loan tenor.
- Superior gold security
Gold is a precious metal, and therefore the first thing that comes to one’s mind while pledging it is its security. However, individuals do not need to worry about the same as the best gold loan providers ensure robust gold security.
Usually, the pledged gold articles are secured in a vault and kept in a room equipped with advanced security features after collecting from borrowers.
Once you know the features and benefits of the best gold loan, you can make the most of this fund. With reduced borrowing costs and short tenor, you can upkeep your credit score by repaying the loan on time.