Gold loan Also Helpful For Medical Reasons

Gold loan is a very common option amongst individuals to avail cash instantly, as it is habitual for Indian individuals to keep gold in their house. It is a tradition that have  been followed for ages. This allows them to use gold in emergencies. Gold can be used by individuals as collateral to avail funds for diverse needs.

One of the situations, where an individual may need to choose the option of availing a gold loan from a bank or other financial institutions is in the case of a medical emergency. If there is a sudden medical emergency, savings and a medical cover might not be enough to cover the all the bills such as medicines, tests,  and hospitalization. In such a situation, a gold loan is a very viable option and it could help in paying for a life-saving situation.

There are several benefits of procuring a gold loan -

1. Instant disbursal - In a medical emergency, there an urgent need for money, a gold loan would be the most suitable option in that situation. The process of loan application and submission of documents can be done online. After the bank or the financial institutions completes their verification process of the documents and value of gold, disbursal of loan is done in 24-48 hours.
   
   
2. High Loan to Value - The loan amount, in a Gold loan, is sanctioned at a specific percentage value of the gold, which is determined b factors such as purity, weightage, market value. Banks and financial institutions provide a loan to value ratio of up to 75%, which can be very useful for an individual in a medical emergency to pay the bills.
   
   
3. Flexible repayment structure - Banks and other financial institutions provide several options to individuals for repaying their gold loans. The individual has the option of repaying the loan through equated monthly installments (EMIs),  advance interest payment - where the interest is paid in advance and principal amount at the end of the loan tenure, interest payment at regular intervals - where the interest is paid at regular intervals and principal amount at the end of the loan tenure and bullet payment - where the principal amount and the interest charged on it is paid together at the tenure end. These options are beneficial in a medical emergency as the borrower does not have to worry about defaulting in payment or being levied a penalty.
   
   
4. Simple Criteria - Unlike other loans, the gold loan does not consider factors such as income, debt history, employment stability, and loan repayment capacity which are considered in other loans. In a gold loan, the loan is sanctioned against the gold of the borrower. Even a person with a low credit score and avail of a gold loan. The process also requires minimum documentation such as proof of identity, proof of residence, etc. Even proof of income is not needed. This is again very beneficial for a borrower in medical urgency as they do not have to worry about difficult criterion or any extensive paperwork. Online facilities provided by institutions such as Muthoot Finance Gold Loan make these processes very convenient for the borrowers.
   
   

The process to avail a gold loan - 

1. Gold loan application
    
2. Submission of gold
   
   
3. Gold evaluation
   
   
4. Collection and verification of documents
   
   
5. Disbursal of Loan

Eligibility Criteria for a gold loan

1. Any individual who possesses gold can apply for a gold loan, regardless of their employment status or type of work.
   
   
2. To apply for a gold loan the individual should be 21 years and above, the maximum age limit differs in every bank and financial institution.
   
   
3. The applicant should have all the required documents.
   
   

Thus, because of the simple nature of a gold loan and the various benefits attached to it, gold loans can be a very useful option in medical emergencies.

Also read this: How to manage gold loan EMI’s?