A Gold Loan for Financial Emergencies
When a person hits bottom on the financial position and has emergency needs that have to be fulfilled, they can take loans for these people in such a situation. A loan is a type of credit that is given to the individual in the form of money. They are obliged to pay them at the end of their tenure, and this payment is made every month called the EMI.A gold loan is a kind of loan that is usually a guaranteed loan when it comes to making a guaranteed loan with gold. It should be 18-24 carats for collateral or gold; the amount given from the gold loan depends on the gold weight. In general, the current market receives money 80 per cent of gold's cost.
Who can apply for a gold loan?
If you have gold, you may obtain a gold loan. Gold loans can be used by any indigenous resident, including salaried professionals, business people, homemakers, and even farmers, instead of personal loans that include stringent eligibility criteria. To qualify for a gold loan, you don't even need a good credit value. So when you have low credit, you still have a chance to get money if you've got enough gold to Pledge. The different kinds of an emergency can be educational, family-related, personal-related, and social-related as well.
We have a different type of emergency many times when we cannot meet any sudden expenses. For example- During the rainy season, one may experience electrical problems. The cables can get wet, or a short circuit can happen. The house’s cable circulation may have been damaged as a result of a shock near the kitchen. Any kind of fire accident can occur if not treated properly. The best option in this particular situation is to finance this and fulfil specific small requirements. For such a purpose, if one doesn’t have money to pay the bills, they can take gold loans. When you take a Bank of India Gold Loan Per Gram, it is the same throughout India.
Why people use the gold loan?
1) Faster handling- Because gold lending is backed by physical gold; bankers are happier to lend in general. The banks can sell the gold if they do not accept gold lending, so banks usually pay out the loan after few hours because the time for treatment is lower.
2) Option for payment of interest only– Gold loans have a unique feature in which the borrower can only pay the interest and principal amount at the time of loan closure.
3) Lower interest rate– Because these loans are secured, banks charge a lower interest rate than unsecured loans like personal loans. Typically, interest rates range from 13 to 14%, while personal loans usually start at a 15% interest rate. Furthermore, the gold loan interest rate can be reduced further if another security is attached as collateral.
4) No fees for treatment– Many NBFCs and banks do not charge the treatment fees because these loans are instantly given instead of gold held to the creditor as Collateral. Gold Rate In Bangalore is R.s 4225.
5) Low charge or no charge for foreclosure- Some lenders charge no prepaid fees, while some banks charge a 1 per cent advance payment penalty.
6) Required no income evidence– Lenders generally do not request proof of income, as the loan is guaranteed against the bank's gold.
7) Bad credit history, not an issue– Unlike other loans where the loan amount is given depending on the repayment capability and credit history, the case is different in a gold loan. Because gold is used as collateral, the lenders are not concerned about the main component and thus do not monitor the borrower’s credit history.
8) Safety of gold– The lender is responsible for the safety of the gold. It will remain safe in its vault, and you don’t have to worry about that. After paying the amount back, you will receive the gold back.
Also Read:- When you need to avail gold loan
