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Gold has been in existence since the dawn of time. And the usage of it has only grown more so in India than in any other country. It has become part of our day to day life increasing its value and requirement over time. The immense usage of gold then led to the invention of loan against gold and its high demand. A gold loan is a secured loan provided against the customer’s legal gold ornament or article. The loan is granted for a certain period on the agreement that the borrower pays the principal with interest on or before the end of the loan term. Gold loans are common in all classes of society primarily because of their abundance of advantages. As the production of gold articles and other forms increased, the purchase of gold became higher and higher, making it all the more for the people to use it as collateral instead of immobile properties or high-interest unsecured loans. The banks and financial institutes ensure that the gold asset received is protected and in good care. Therefore the gold is even safer in the bank’s or NBFCs vault than in-home lockers. Plus, the money sanction on the gold loan is much higher than many other loans. The interest rate is low, and the tenure is short, making it all the more attractive. Gold loan Calculators on the bank’s official website or NBFC can be used to know more about interest rates, tenure, and principal amount depending on the weight and purity of the gold asset.

The increase in demand for gold loans is significant because of its requirement of minimum documents and no income proof. To avail of a gold loan, the documents required are ID proof(PAN card, Voter id, Aadhar card, driving license, passport, or any other valid proof of id), two photocopies of the applicant and proof of agricultural land if the applicant is a farmer. Farmers are applicable for lower interest rates than usual in gold loans. Income proof is not required for a gold loan. Therefore you can take out this loan even if you are unemployed or a homemaker or facing difficulties in having a permanent job. A gold loan also doesn’t need a credit score. A credit report by the company CIBIL contains personal, banking, professional information in addition to past credits(loan or debts) of individuals, societies, companies, corporations and/or other banking customers. The report is summarized by credit score or CIBIL, which varies mainly from 300 to 900 and is extremely important for taking out most loans as it depicts the borrower’s repayment capability. But for a gold loan, it is unnecessary as it is secured. Due to the above reasons, the processing of the gold loan is easy and doesn’t take much time to get money from the lender. This makes a gold loan convenient and the first choice among other loans. Unlike other loans with only one repayment option as Equated Monthly Instalments(EMI), the gold loan also has bullet scheme payment and partial payment methods to repay interest amount and principal. The bullet scheme payment is where you as a borrower pay the total interest amount and loan amount at once at the end of tenure. In the Partial payment method, you pay a partial amount of the principal amount and interest whenever you wish before the term ends. This scheme is available only in banks and NBFCs.in the regular interest payments; you pay the interest amount each month till the end of tenure and the principal amount at the time of maturity. This is the most famously used method of payment or reimbursement. The payments can be done either via net banking or through cheque or cash. Automated detection is also available, where the lender automatically deducts the interest and principal when the time comes from the borrower’s savings account. But there must be enough funds to do so, and the borrower has to opt for this type of payment personally. Oriental Bank of commerce gold loan provides online and offline services with the best offers in the market.  

Must Read:- What is a Gold Loan? 

In the case of a gold loan, the unique thing is the low rate of interest. On the other side, all the other types of loans have a high rate of interest which acts as a matter of burden in most cases. There is a reason behind the low rate of interest also. There is the availability of the gold loan calculator, which gives better estimation when taking the decision to avail a loan. In most of the cases of the other types of loans, the rate of interest is low due to the dependents of many factors like that of competition among them Financial institutions and gold rate movements within the domestic territory of the country as well as the movement of the price of the gold in the international market.

Age Limits

First and foremost, according to the eligibility criteria for availing a gold loan, most of the banks, nbfc and The Financial institutions have separate legal formalities as per their suitability and the choices according to their business styles and patterns. On an average basis, there has been an age limit that generally ranges between the age of 18 years to 70 years. The age criteria have been made like that because at the younger age of less than 18 a person in the teenage years will be in the studies of the colleges or might be searching for any kind of job.

 Therefore, there is no stability or the independence of the financial situation at the very tender age, due to which the age has been kept with the upper limit of 18 years. If we talk about the upper limit of the age criteria, some patterns and factors have been considered. Near about 70 years of age has been kept as the upper limit. After the age of such an experience, there is no more availability of financial dependency as the age for most of the jobs gets over, and the life of the retirement starts over here. The life of financial independence also reduces or gets depleted along with the fasting days and Times.

Loan to value ratio

There has been the loan to value ratio implementation, which means how much of the money in the form of loan you will be getting as per the total value of the gold availing party. PNB gold loan offers a lower LTV ratio for the customers to benefit them. Previously the loan to value ratio went to less, but as time passed by and the different forms of loans have been implemented for the betterment of the customer. The loan to value ratio is lower than the loan amount that a customer wants to avail might not be possible if the percentage is unfavourable.

 Nowadays, the loan to value ratio has increased 75% to 90%, and even that of a hundred per cent is also available. There has been a range of between 75 - 100 % of the loan to value ratio in most banks as there is cutthroat competition among the institutions. Not a single company wants to give up their customer due to competition in the market.

Purity pattern of the gold

There has been a pattern of maintaining a purity limit so that the gold becomes acceptable for providing a loan. The purity limit starts from 18 carats and should be below the maximum limit of 24 carats. Anything above or below this limit is not treated as extractable gold for providing a loan. So one thing should be kept in mind after getting gold from other people as a helping hand during that particular time should be examined and evaluated from the goods made that should have a purity limit of between 18 to 24 carats.

Less Time Consuming

Gold loan is also preferred because of its less time-consuming documentation process. It is decided by only proof of address, proof of Identity, passport size photograph and a gold ownership document.

Read More:- A Guide to Gold Loan 

Gold loan has always been an important part in uplifting people in difficult times. People all over the India urban as well as rural area have faith on gold loan as it one of most safe and secured loan. Gold Rate Today for 10gm of 24 carat gold is 48,680.00 Indian Rupee. This is the best time to invest in gold as there is an increase in the market price of the gold. One can apply for a gold loan online at the website of the bank or non-banking financing companies(NBFCs). 

Dena Bank Gold Loan can be applied easily online at the website of the bank or offline at the nearest bank branch. The bank offers amazing schemes on gold loans. The application for a gold loan is easy and it requires minimal documents. The required documents are Aadhar Card, Valid Driving License, Valid Passport, Voter’s ID Card, Salary slip, income tax return documents, employment proof, bank statements, income proof and other documents as demanded by the bank. The bank is recommended for getting a gold loan. 

Applying for a gold loan has various advantages. One can even apply for a gold with a bad credit score. While availing a gold loan credit score is considered by various banks and non-banking financing companies(NBFCs). Gold loan is a secured loan and it only requires gold ornaments and coins as a security against the loan. In gold loan credit score and report is not considered important. It is preferred by so many people in times of emergencies as it doesn't require a good credit score and can be availed easily without any hassle. In gold loan CIBIL scores are less desirable. A gold loan can help in increasing the credit score of a borrower if the repayment of the loan is done timely. One can easily get a gold loan at a minimum cibil score without any difficulties. 

The various benefits of the gold loan is listed below:- 

• Quick processing:- In modern times getting a gold loan is easy as the processing time is faster compared to earlier times. The processing of the hold loan required 24hrs to 72hrs. One can also apply for a gold loan from the online website of the financing company for the faster processing of the loan.
  
  
• Loan disbursal:- After the loan documentation verification the loan amount is sanctioned in the saving account of the borrower. The amount is sanctioned in 72hrs after the verification of the documents and evaluation of the gold.
  
  
• Ideal for emergencies:- Gold loan can be used for meeting various daily requirements and hence it is considered to be ideal for emergencies. Various people all over the country apply for a gold loan in the times of emergencies.
  
  
• Loan upto 50 lakh:- one can easily get a loan amount upto 50 lakh. This is very much advantageous for the applicant. One can easily get a higher amount of the loan sanctioned in the savings account. It can be very much beneficial in the case of emergencies. The loan amount depends upon the market price of the gold. The higher the market price the higher will be the loan amount availed.  
  
  

Conclusion :

Gold loan can be availed even if the applicant has a bad credit score. Being a secured loan it only requires gold ornaments, bars or coins as a collateral against the loan. Most of the financing companies do not consider the credit score or report of the applicant. As the only thing desired by the financing company is high purity and amount of the gold given. One should visit online website or app of the preferred bank for applying for a gold loan. 

Also Read:- GOLD LOANS HUGE DEMAND 

Investing in gold has been prevalent since ages and deemed to be the best option over other investments. It provides assistance to the family at the time of financial crisis, because gold loans can easily be availed by pledging the gold. India is one of the largest importers of gold in the entire world, and is also known for their love towards gold. In Indian festivals it is a ritual to purchase gold as it brings prosperity in the family, like in Dhanteras, Makar Sankranti, Gudi Padwa, Akshay Tritiya. This age-old tradition of buying gold is still considered pious by most households.  If someone faces an urgent financial disaster, this asset can generate him cash with minimum obstacles and formalities. 

When a person chooses to get a gold loan the market value of the gold pledged is calculated according to the power per gram market rate of gold on the day of loan application. The stones and gems in the jewellery are excluded from the calculation. Generally the maximum loan that a person can avail is 75% of the market value of the gold in the ornaments depending on its quality. Generally the maximum and amount eligible for an applicant of gold loan ranges from Rs 1000 to Rs 2 crores, where loan per gram is around Rs 2748 to Rs 3359. The people who are eligible to get a gold loan can be within the age of 18 to 75 years.

 Gold Loan per gram based on total weight of ornament, level of the gold purity, past one month average price of 22 carat gold and LTV ratio applied by banks, is calculated by the Gold Loan Calculator. The EMI is composed of both the principal amount of gold loan and the interest component attached to it. EMI Gold Loan Calculator helps to calculate the monthly EMI at the rate of interest and repayment time thereby minimising all the worries of paying debts. EMI depends upon the loan amount which will get higher if the loan amount rises; the higher rate of interest will increase the amount of EMI, and if the loan tenure is high the EMI gets lower.  Though the minimum age for applying for a bank gold loan is 18 years, many banks require the minimum age to be 21 or 23. 

The employment type of the applicant is also another factor to get the gold loan. Salaried employees, self employed, businessman, housewife, senior citizens all are allowed to fetch a gold loan. To meet the working capital requirement, businessmen also get a gold loan as the rates of interest are comparatively low. Homemakers and senior citizens with no income proof and credit score can easily get the benefits of a gold loan by most Banks like Axis Bank gold loan, Gold Loan in ICIC Bank, SBI Gold Loan, HDFC Gold Loan.

The ornaments that are to be pledged with the bank must be within 18 to 24 carats of pure gold. So, the price of a 22 carat gold ornament can be estimated by multiplying the price of a 22 carat gold ornament by a factor of 20/22. The CIBIL score for granting a gold loan is hardly checked but the repayment track record of the debtor may be instrumental in the CIBIL score. Even job stability or business stability is also not a factor for sanctioning a gold loan. KYC documents such as address and identity proof and the gold to be pledged is enough for availing a gold loan.

 Some most significant things from a customer's standpoint are clarity, security and choice of loan product to suit their requirements. There should be no hidden cost that may lead to extra burden on the debtor. The internal system and strategies of the company which assures no malafide activities against the gold pledged, should be transparent to the debtor. The choice of loan scheme must cover the range from high LTV to low LTV with appropriate variations in interest rates.

Also Read:- Different Sub-classes Of Gold Credits 

Now, if we talk about gold loans, there are certain prerequisites that need to be fulfilled before getting the loans sanctioned. It is the same for every bank and institution to ask for these documents which means that before showing a certain few documents and getting them approved you cannot move further as they come under the eligibility criteria which needs to be fulfilled to get the loan. Now, these eligibility criteria vary as we obtain different loans. Some require some documents whereas others might ask for certain other documents for getting the loan.

 Let us mention some of the eligibility criteria that are important to be followed:

There is a certain age criteria which needs to be followed by the applicant that is, any citizen above the age of 18 years and a maximum of 70 years will only be considered eligible to apply for the loan against gold, and in case the age of the borrower is above 70 years then, there must be a co-borrower. Then the profession of the applicant is also taken into consideration, such as most banks and institutions offer jewelry mortgages to businessmen, salaried employees, self-employed people etc. Then there are some eligibility criteria as to the purity of the gold that you will be pledging against the loan amount. Banks and lenders generally prefer accepting gold of 24 carats or 22 carats, and a few of them might accept 18 carats of gold, but that decreases the amount of loan that you will be receiving. The gold is generally offered as per the gold rate today. These are some of the criterial that need to be followed to get the gold loan approved.

Now, there are some criteria in respect to the documents that need to be submitted to get the gold loan sanctioned. These documents are identification proof such as Aadhaar card, pan card, voter ID card, passport etc., then address proof such as the driving license, rent agreement, passport or utility bills that involve electricity bills, water bills, telephone bills, gas bills etc., income proof can also be asked for in the form of salary slips, bank statements, form 16 etc. and some additional documents such as passport size photographs of the applicant etc. and everyone should always carry as the original documents along with the photocopied documents as the bank or lender can ask for any of the two for evaluation. In some cases, a few documents are asked to be kept by the institutions so that they have proof of the borrower.

These are all the eligibility criteria that need to be followed to get the gold loan sanctioned. Every bank or institution needs to fulfil these criteria in order to get a gold loan. Apart from these criteria, a person should see that he is able to fulfil the other requirements, and his pocket allows him to get the loan. There are certain requirements such as the tenure and the rate of interest which need to be seen before taking the loan as they play a major role in the loan process, and these need to be checked before taking the loan.

One of the loan options which makes your process easier by getting your loan on simple conditions is the gold loan at Future capital. These loans are easily available at reasonable terms and conditions. They offer you quite a flexible tenure along with a rate of interest of your choice that suits you and your pocket. They ask for documents that can be easily arranged, most of which are mentioned above. And now, they also provide the facility to apply for online gold loans, which makes it an easy task to get the loans sanctioned with a few clicks of buttons.

Must Read:- Not Many Significant Variables That Influence Gold Costs 

They have several misunderstandings about gold loans and how they work. If you're in confusion of whether or not to take out a gold loan, keep reading to learn about some common misunderstandings. Individuals or applicants can use the Gold Loan EMI Calculator to estimate how much interest they'll pay on a gold loan secured by their gold or gold jewellery.

HERE ARE SOME  MYTHS ABOUT TAKING GOLD LOAN 

It Takes A Long Time To Get A Gold Loan:- When it comes to gold loan myths, this is the most common in all of them. It is a very lengthy process but the truth is   gold loan is the only type of loan that can be obtained on the spot. Gold loans are approved and disbursed within a day, if not an hour, by banks and non-bank financial institutions (NBFCs). A gold loan is the way to go if you're in urgent need of cash. Gold loan Per Gram gives you an estimate of how much money you may borrow against your gold jewellery.

If You Have Old Traditional Jewellery, You May Not Be Approved For A Gold Loan:- Many people believe that banks and non-bank financial institutions (NBFCs) only lend money to persons who have  new or recently purchased gold jewellery. As a result, despite having a large number of antique gold jewellery, people would not seek a gold loan. However, let us dispel this myth: banks will lend money on antique gold jewellery. The gold must be pure and at least 18 karat to qualify for a loan.

The Gold Loan Is Exclusive Get By Jewellers:- Many large banks and non-bank financial companies (NBFCs) now provide easy gold loans with low interest rates. Many banks and non-bank financial institutions (NBFCs) began to offer gold loans as more people began to invest in gold. There are only a few non-bank financial institutions. Gold loans are a specialty of non-bank financial institutions (NBFIs). It is always safe and secure to take out a gold loan from a reputed bank or non-bank financial institution. Those who assume that gold loans can only be obtained from jewellers and are concerned about their reliability may seek a gold loan through a bank or non-bank financial institution ( NBFC). The IIFL Gold Loan provides secure on-the-spot processing, as well as various repayment choices  with attractive rates of interest.

Your Gold May Be Discreetly Switched:- You must maintain your gold at a bank or a non-bank financial institution (NBFC) to secure a loan against it. If you repay your debt within a certain time frame, the bank or NBFC will return your gold jewellery. Many people assume that money lenders replace your ornaments with fake ornaments. As a result, many people decide against taking out a gold loan because they are worried about their valuable jewellery being stolen.This is not the case, however. To secure your gold loan kept as collateral, banks and non-bank financial institutions (NBFCs) have special security and locker procedures in place. It will only be removed once you have paid off your loan in full. As a result, you can confidently hand over your gold to a bank or non-bank financial institution (NBFC) for a loan.

Gold Loans Have Extremely High Interest Rates:- Banks and NBFCs charge varied interest rates depending on the type of loan. If the loan is unsecured, the interest rate is high, but if the loan is secured, the interest rate is low. A secured loan, such as a gold loan, is a type of secured loan. As a result, banks and non-bank financial companies (NBFCs) do not impose excessive rates of interest The interest rate on gold loans can range from 10.26% to 26 %.

In India, the spread of Covid-19 has resulted in a severe financial shortage. While it is always good to conserve money so that you may utilise it when you are short on cash, one of the methods to get cash during Covid-19 is to take out a gold loan. Most lenders or lending organisations, such as Banks, Financial Institutions, NBFCs, local lenders, and others, offer gold loans in which a sum of money is lent to the borrower in exchange for gold ornaments held as collateral deposit with them. People in financial distress frequently use gold loans to cover their needs while maintaining gold as collateral with the lending organisation.

Gold Loans are one of the most straightforward solutions to overcome financial challenges by simply having your gold jewellery evaluated and borrowing up to 75% of the gold value, depending on the current market rate and weight of the gold. The increasing risk  among lending institutions, as well as the high level of uncertainty brought on by the covid-19 outbreak, has boosted people's willingness to take out gold loans. Due to the implementation of strict lockdown in most states, those who own small enterprises or work on a regular basis are at risk of losing their jobs.

Because unsecured loans such as personal loans and group loans are not available due to the global uncertainties, gold loans are in high demand. Due to the outbreak of the covid-19 pandemic in the financial year 2020, credit growth in this industry fell, while gold loans resisted the trend. The cost of repaying a gold loan is also minimal because the debtor has the option of repaying the principal at the end of the loan repayment period and simply paying interest during the repayment period. During the shutdown in April and May, banks and financial institution's operating hours were restricted, resulting in a lower disbursal take-off. The  future Gold Loan demand will be determined by a number of factors.

Gold loans will remain a popular form of funding because they are easier to obtain than other types of financing. Learning institutions were only allowed to issue 90% loan to value or LTV ratios after the Reserve Bank of India granted a special dispensation, but this concession expired on March 31st. According to official Reserve Bank of India data, most people get gold loans by pledging their household gold reserves to borrow money for essential expenses and medical emergencies after the lockdown caused job losses, wage cuts, and business closures. Gold rate today for 10 gram of 24 carat gold is Rs. 48,760. The bank may not take more than 72 hours to disburse the loan amount to your bank account after you have pledged your gold ornament and submitted the required documentation together with the application form. This means you can collect your loan money as soon as possible and meet your financial obligations.

On Term Loans, Overdrafts, and EMI-based loans, HDFC gold loan offers reasonable interest rates. Repay your loan over a tenor of your choice with cheap EMIs. Before applying for a gold loan, make sure you evaluate the numerous gold loan plans available to find the one that best suits your needs. After you've compared and decided on the plan you want, you can apply for it either online through the bank's website or in person at the nearest lender's branch.

Gold loan has been a  Saviour. It has helped so many people in financially difficult times. Gold Loan Per Gram ranges between ₹ 2,741 to ₹ 3,350. One can easily get a gold loan at a very reasonable interest rate. For applying for a gold loan visit the online website of the preferred bank or you can also visit the nearest bank branch.  

PNB Gold Loan requires easy application with minimal documentation. The documents required are Aadhar Card, Valid Driving License, Valid Passport, Voter’s ID Card, Salary slip, income tax return documents, employment proof, bank statements, income proof and other documents as demanded by the bank. The bank also offers amazing schemes on gold loans. One can get a gold loan at an affordable interest rate at the bank. PNB bank is recommended for getting a gold loan. For more information one can check the online website or app of the bank. 

Loan to value is used by the lenders to define the ratio of the loan to the market value of the asset. The term is commonly used by the banks and non-banking financing companies(NBFCs). There has been a recent rise on the loan to value on the gold loan. The loan to value of gold loan has increased to 90%. Due to the covid-19 lockdown so many people were affected,  so the government decided to increase the loan to value on gold loans. Now people can avail higher loans against gold. LTV is a very important aspect of loan; it refers to the amount of the loan a borrower can avail against the gold as a collateral. The LTV for gold loans is quite high. Banks and non-banking financing companies can lend more money against the gold as per the new rule. This is one of the biggest advantages of getting a gold loan as the LTV offered is quite high and can help dealing with financial difficulties. 

There are various features of a gold loan. Some of the key features of the gold loan are listed below:- 

1. The processing time of the gold loan is faster in comparison to other secured loans. The application processing is faster. The loan is processed within 72 hours of the application.
   
   
2. Minimal documentation is required for getting a gold loan. Documents such as identity proof, residence proof and age proof are required. Anyone can get a gold loan providing these minimal documents.
   
   
3. Fast approval is one of the key features of the gold loan. In gold loan the banks and non-banking financing companies(NBFCs) provide fast approval. The loan is sanctioned into the account of the borrower after the verification of the documents.
    
4. The LTV value for gold loan is high up to 90%. One of the biggest advantages of the gold loan is that it has quite a high LTV value which makes it ideal in the financial emergencies.
    
5. An applicant does not need to provide salary proof. The only thing important for a gold loan is the purity of the gold. Without salary proof getting a gold loan is possible. 

Conclusion -

Gold loan has various features but one of the most significant features is its high loan to value(LTV). An applicant can get a higher amount of loan by submitting gold as a collateral to the bank or non-banking financing companies(NBFCs). There are also various schemes which can be availed during a gold loan. Gold loans are very advantageous for the people. Many people around the country are investing in gold. Investing in gold is a smart choice as they are very precious assets in today's modern times.

A gold loan is the simplest form of a loan from which the cash requirements and the emergency requirement of the cash can be fulfilled. Under this method if gold in the form of jewellery or the form of a coin if is available with you then you are having the chance to take it to the bank or any kind of nbfcs where it will be valued as per the gold loan per gram according to the current date and after the valuation is done you will be  explained and will be given information about to what extent of the amount of loan can be availed what can be the probable rate of interest, tenure period etc.

Purity of the gold

Everything is not what it seems. If having gold does not mean that it will be accepted. There is a minimum requirement that needs to be fulfilled by the loan borrowers that the gold which they are availing for the acceptance by the financial institutions must have the limitations of purity from the 18 carats as low to as high as 24 carats. Any limitations below or beyond the upper and lower limits are not acceptable by most of the banks and institutions but in certain cases, there are exceptions for which proper approval is required. All these things are done based on the heating up of the purpose of proper execution and evaluation of the accurate loan amount so that the customer does not suffer after availing of the loan.

Rate of interest

One of the most important things about the gold loan as per gold rate today  is that it has the most unique and comparable feature that is the lowest rate of interest. Yes, you heard it right, the lowest rate of interest as compared to any type of loan. It has been noticed that banks provide good deals of the whole done at a very low rate of interest as compared to that of the NBFC but overall the gold loan is provided with the lowest rate of interest. That makes the customer feel so easy and finds it's equal to avail a gold loan in kind of any emergency as compared to that of the other options which are time-consuming, expensive and uncertain.

No headache of credit score

If you talk about the personal loan, car loan or any other types of loans there is always a requirement of a credit score which is a three-digit number issued by the credit rating agencies or the bureaus. In most unsecured loans there is always a risk that either there will be a surrender of the loan amount or the non-payment of the loan or the customer will become bankrupt. In this type of situation, the bank has no option but to add the loss under the heading of a bad day for a bad loan which is a total loss for the financial institutions. Canara Bank gold loan offers such schemes that along with no requirement of credit score there are also other benefits. In the case of a gold loan, there is no risk associated the gold available with the bank against which the loan amount was sanctioned will be treated as an asset and will be sold off or will be auctioned in case of any such incidents and the bank will be having the freedom to resell it accordingly and recollect the amount from there.

Conclusion

To conclude, we can see that there is no other loan that will be sanctioned or approved as fast as a gold loan as there is a very little requirement of documentation which only includes the address proof of identity and just some passport size photographs and the documents showing the ownership of the gold. This is the reason that gold is not only used in the celebration of the festival but also in the celebration of crossing over the difficult situations of life in the form of a gold loan

Read More:- Gold Loan Meet The Needs Of People 

About half the population in India have safe boxes in their houses filled with nothing but gold. And that gold is the key to have many more of those lockers. The most straightforward and first step in that process is availing of a gold loan. How can a gold loan make me rich? It is a  good question with the most apparent answer. You use the loan amount to start a new business or expand one or invest in one, the options are endless, and when the money is back with profits, you can pay the loan amount with interest and have your gold back. It is as simple as that.

And especially now during this highly conspicuous spread of disease, the money has more possibilities to save you than the other way round. Banks and NBFCs now respond to their customers more fervently and are servicing in the most plausible and pleasurable way. With the advance in technology and the inventions of new machinery, you can avail of a gold loan from anywhere in the world using the internet and a cellphone. A gold loan requires the least amount of documents. All it needs is ID proof, photocopies of the applicant and the gold asset. Unlike many other loans, a gold loan doesn’t need income proof. 

Anyone can avail of it, no terms on the vocation of the applicant, no need for employment proof, bank account statement and most importantly, no CIBIL score necessity. CIBIL score is a three-digit score ranging from 300 to 900 and is considered extremely important for taking out a loan. But for a gold loan, and the bank or financial institute grants money even if you have a low or bad credit score. Although after availing of the loan, maintaining the score is a pre-requisite for future loan possibilities.

 Banks and Non-Banking Financial Companies(NBFCs) offer a gold loan with affordable interest rates and a maximum loan amount for a short tenure. The loan amount depends on the rate of gold on that day and its purity and weight. The gold rate today is Rs 48,620 for 10kg of 24-carat gold. The repayment options are flexible and exceedingly convenient. The loan is general, and therefore, the bank or NBFC doesn’t question you regarding its purpose. It can be used for medical emergencies, weddings, educational purposes, vacation, parties, business, construction, renovation and many more. 

Moreover, a gold loan offers a loan moratorium for three months if the applicant is in a highly challenging financial situation. During this period, the borrower doesn’t need to pay the interest amount. Still, they are only eligible for this facility if they’ve paid all the preceding instalments on time and have a healthy relationship with the bank. This facility is incredible and helping in this pandemic.

Bank of India gold loan is acclaimed for its best deals and offers in the market. The bank offers up to 90% of the gold’s value as the loan amount. The interest rate for hallmarked jewellery and coins in BOI starts from 7.35% per annum, and for regular jewellery, the interest rate starts from 7.40%. The margin of the gold loan for agricultural purposes is 15% to 20% and for other purposes is 25%. The bank also offers many repayment options such as yearly, monthly, quarterly, or bullet scheme payment depending on the borrower’s income.

 Conclusion
Availing a gold loan is effortless. The processing is easy, and no need for excessive documents. But one shouldn’t forget that a gold loan is a secured loan, and paying the monthly instalments on time is colossal. Moreover, the bank or NBFC has the right to auction your gold if you aren’t paying the interest amount for three months consequently.

Must Read:- Offline Gold Loan Approval Process 

What are the Merits of Gold Loan?

After learning about the process for applying for a gold loan, you'll want to learn about the benefits of taking out a gold loan and why so many people prefer this secured loan option.

1) Lower Interest Rates

Everyone needs their loan facility to have lower interest rates. Since it is a secured loan, a Gold Loan could be the better option for you. Your gold will be used as leverage to secure the loan. The interest rates on Gold Loans vary from 9% to 20% per year, but on average, they are between 10% and 16 percent per year.

2) Higher Loan Amount

A gold loan allows you to borrow the maximum amount possible against your pledged gold jewelry. The Loan-to-Value Ratio is used by lenders to calculate the loan amount (LTV). In the case of a gold loan, this ratio will range from 65 percent to 90 percent. This ratio indicates that you can borrow up to 90% of the total gold value and as little as 65% of the total gold value.

3) Flexibility in Repayment

• EMI Method –The Tenure will be paid in monthly installments, with a portion of the principal and interest paid each month.
  
  
• Interest is Paid Regularly – Pay the interest at regular intervals – weekly, quarterly, semi-annually, or annually , and the principal at the end of the term.
  
  
• Interest Payments in Advance – Pay the entire interest rate upfront and the principal sum at the end of the term.
  
  
• Bullet Redemption – Make no installments for the lifetime of the loan. Rather, pay both the principal and interest at the end of the year.
  
  

4) Faster Processing

If you need money as soon as possible, a gold loan could be the best option for you because you will get the loan sum much quicker than with other types of loans. As we stated in the procedure section, the loan sum is disbursed into your account as soon as the paperwork and authentication are completed. Furthermore, since you are using your gold reserves as collateral, lenders are fast to disburse the loan.

5) No Need for Credit History

If you've had several loan applications denied due to a bad repayment history, a gold loan might be a good choice for you because lenders don't look at your credit history before granting you the loan. This is due to the protection you have offered in the form of gold ornaments or bank-minted coins. A gold loan is ideal for those who are looking for a loan with lenient eligibility requirements. But better be aware of gold rates where you live. Suppose you are in Chennai, then it better to know about the Gold Rate Today at present as it will help you to evaluate your gold value.

6) Demerits of Gold Loan?

You can Lose your Gold Assets, As you might be aware, you obtain a loan against your gold assets in the form of jewelry and coins, and you receive your ornaments back from the lender after the loan has been completely repaid. However, you should keep in mind that if you do not repay the loan or default, you risk losing your properties because the lender will settle the loan by selling your ornaments. 

7) Impact on CIBIL Score 

Your credit history is not checked when the loan sum is issued, but if you miss a payment, your CIBIL score will be negatively affected. As a result, it's a good idea to pay back the loan in full as soon as possible, using whatever form you selected at the time of application. On top of that, on-time payments will help you increase your credit score.

CONCLUSION-

The gold loan is always seen as a better option if you had a bad credit history. Some many banks and NBFCs offer gold loans as they are aware of the opportunity that gold can bring to you and also to them. Banks like SBI offer gold loans at a cheaper rate. The gold loan offered in SBI Bank is better in comparison with other banks. So it is better to go with market search to get the best deals for yourself.  

Must Read:- Gold Loan in times of Covid 

Money against the gold ornament you pledge in a bank or Non-Banking Financial Institutes(NBFC) is a gold loan. The loan is fruitful at times of different needs and wants. The loan can be availed both in the online and offline mode. Using the internet and an electronic gadget, you can avail of this loan from anywhere in the world. Depending on the day’s gold rate, the value of the gold is determined. The gold rate today is Rs. 48,670 for 10kg of 24k gold.

The Bank of India gold loan is a trustworthy gold loan with millions of customers and borrowers. The bank offers online and offline services with the best interest rates and maximum loan amount. The processing is rapid, and the Bank of India(BOI) disburses the loan for several hours. In addition, the bank introduces various schemes and offers from time to time.

Features and benefits of availing a Gold Loan

1) Easy Processing: The processing of the gold loan is straightforward, mainly because of its minimum documentation requirement. Unlike many other loans, gold loans only need id proof, two photocopies of the applicant and the collateral. Therefore, banks and NBFCs quickly verify the loan and disburse the money.

2) No income proof needed: Generally, to avail of a loan, a bank or NBFC demands the applicant’s proof of income to know the payment capability. But for a gold loan, there is no need for income proof as the loan is secured.

3) No CIBIL score requirement: The credit or CIBIL score summarises a report by a company named CIBIL. The report consists of an individual’s past credits(loans or debt), personal information, banking information, employment information and other necessities. This score usually varies from 300 to 900 and is incredibly important for availing of loans. But for a gold loan, the bank or NBFC doesn’t have a passing score that one should minimum have; therefore, if you are in a highly critical position and need money, as soon as the possible gold loan is your best choice.

4) Loan amount: Sometimes hospital bills cross your annual income, and unfortunately, not many banks and NBFCs grant money that is required, but in a gold loan, nothing matters as long as you have pure and valuable gold in your hands. The loan amount entirely depends on the gold. Therefore the higher the purity and the weight of the gold, the higher the principal amount. Lenders usually grant about 80% of the asset’s value in cash or cheque or net banking very soon after the application’s approval.

5) Low-interest rate: Just because you are in an emergency, you shouldn’t take the first loan you see. It needs to be thoroughly verified and should have the lowest interest rate. Fortunately, gold loan provides loan amount with low-interest rate compared to many other loans.

6) Tenure: The loan term of the loan is known as tenure, and it varies from 3 months to 24 months for gold loans in most banks and NBFCs. The loan is short term and passes very quickly, so it is the best for medical causes.

7) Repayment options: Installment amount as an interest to pay at the beginning or the end of the month till the loan ends are EMI and are highly popular in many loans, including gold loan. But a gold loan has another repayment scheme known as the Bullet scheme, where you can pay the interest amount on the whole at the end of the tenure with the principal amount.

8) Processing and prepayment charges: The fee incurred for the processing and approval of the gold loan is a processing fee. The fee is a maximum of 1% of the loan amount. Prepayment or preclosure charges are procured if the borrower closes the loan sooner than the end of tenure. The fee is NIL in most banks and NBFC, while a few charge a maximum of 1% of the outstanding loan amount.