Is The Gold Loan A Good Option- The Benefits

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The Gold Loan

Is The Gold Loan A Good Option- The Benefits. During the covid pandemic, we all have gone through several ups and downs, there was total deflation wherein the Sensex reached the worst of all time. The situation gets worse, but the ultimate solution we all use during these unintentional times is traditional methods. Gold, the old traditional means that help people recover during hard times, is even now on the surge for credit. After the covid situation, one uses gold for ornaments or showing women glory and as pleasing investment material. Today people buy gold biscuits or bars and keep hold of them till the prices rise, wherein they can disclose or sell their bars for profits.

Many financial institutions started pricing gold or added monetary value on gold which further led to gold loans. Gold loans tend to be cheaper than other loans, and due to their popularity, even the interest rate charged by these institutions is low. The best time for investing any asset, including gold, is when there is a negative impression and an inexpensive asset. One can choose gold stocks that state strong dividends, which help you to take ultimate benefits. Stocks with dividends always have more returns than stocks without dividends, even when the entire sector is in a downturn. Hence, choose your duration and investment wisely.

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Here are the benefits of taking a gold loan:

  • Simple procedures with fast lending: The procedures and formalities of availing of gold loans are very easy. The entire process will hardly takes 15 to 20 minutes, making gold loans ideal for the microfinance segment, where there’s no need to test borrowers’ patience with small loan amounts and elaborate procedures.
  • No depreciation: Gold loans are not subject to depreciation, unlike other secured loans. It is a liquid asset and includes less transaction cost while enforcing security. The lender enjoys comfort as he doesn’t have to keep chasing repayment of instalments or EMI’s. On the contrary, borrowers face interim difficulties of maintenance on checking the factor till repayment consents.
  • A large amount of loan: one can get a loan amount of up to Rs 1 crore. However, this loan amount varies from bank to bank. Banks usually provide a minimum loan of Rs 10000. Banks decide the loan amount depending on the weight of the gold and the current market value.
  • Low-interest rate: Interest rates have a direct relation with gold loans. One can look for the lowest gold loan interest rates online through research and analysis. Certain banks provide an EMI calculator on their website, where you can check the rates of your suitable bank.

Here are some interest rates of certain banks:

  1. HDFC BANK: 9%
  2. ICICI BANK: 9%
  3. IDFC BANK: 7%
  4. KOTAK MAHINDRA BANK: 10.5%
  5.  SBI: 7.5%
  6. CANARA BANK: 7.35%
  7. BAJAJ FINSERV: 11%
  • Flexible repayment: Using fixed EMI spanning over a fixed period in case of a gold loan. One can make the repayment on any amount, and also one can close it anytime.
  • No compulsion on Guarantor: Gold itself is security; thus, banks never ask for a guarantor to give you the loan. The processing fee is also charged less than about Rs 500 to Rs 10000. It differs from the bank and relies on this, and the lender lends the loan.

Looking at all these people who need finance, start looking for gold loans. But what about the documents and eligibility criteria? Better to have an instant glance at the below suggested documents and criteria for less burden and waste of time.

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Eligibility:

  • Any person with any profession can avail the options of gold loan, and it could be a salaried person, a self-employed, a farmer or anyone else.
  • The minimum age is 21 years, and the maximum age is 70 years. 

            ( mostly for aged people one requires to keep a co-applicant)

You can check your eligibility on the Gold loan Eligibility calculator offered by the lender’s website. 

Documents required:

  • Identity proof- Pan card, Aadhaar card, voter id, passport copy.
  • Address proof- Utility bills, Rent agreement, driving licence.
  • Passport size photographs.
  • Gold jewellery certificates.

    ( All these documents vary from bank to bank; one can check on the bank website that you are availing loan ). Nowadays, there are many other options where one can get a gold loan on your doorstep. Certain banks provide loans on the doorstep with simple and instant procedures, like going to banks.  The financial institutions send an employee to your home. After all the verification procedures and placing a green signal of authorization for the loan, an immediate loan amount transfer takes place to your account. For those who want money in cash instantly, even those features are available. Hence, looking at the benefits of gold and its role in profit maximization, gold is the best viable option one must consider. For any queries, one should contact the bank helpline numbers or mail them.