In an increasingly complex financial landscape, gold loans have emerged as a compelling alternative for those seeking quick and reliable access to funds. Unlike traditional loans, which often involve lengthy approval processes and stringent credit checks, gold loans offer a streamlined solution that leverages the value of one’s gold assets. This unique approach not only simplifies the borrowing process but also provides several advantages that make gold loans a preferred choice for many.
This article gives you a quick overview of the facts & tricks you should know before you apply for a
gold loan to attain maximum advantages.
What is a Gold Loan?
Gold or jewel loans offer a practical solution for individuals facing financial needs or emergencies. These secured loans allow borrowers to leverage their gold assets, such as jewellery or coins, to obtain necessary funds.
Gold loans’ primary advantages are their immediate disbursal, providing quick access to cash when time is critical. Unlike traditional loans, gold loans do not require a credit history, making them accessible to those with varying credit backgrounds. The secured nature of these loans means that the gold pledged serves as collateral, significantly reducing the risk of default.
Additionally, there are minimal restrictions on using the loan amount, allowing borrowers flexibility in addressing their financial needs. The documentation required is minimal compared to other loan types, streamlining the application process. Gold loans also generally feature lower interest rates, which can make them a more cost-effective option. Furthermore, responsibly managing a gold loan can positively impact one’s credit profile, aiding in credit building.
There are many ways to apply for a gold loan. For immediate disbursals in the comfort of one’s home, one must apply through a trustworthy
gold loan app and fully understand its eligibility criteria, limitations, rate of interest, needed documents, and, most importantly, repayment options.
What are the Eligibility Criteria for Applying for a Gold Loan?
If you think getting approval for a gold loan is immensely easy, you are wrong! Just like any other loans, there is even a long list of eligibility criteria for getting approval of a gold loan. Here’s a list of criterias given below which would ensure clarity on the sure.
- You must have the ownership of the gold : This certainly means that the lender must have gold possession in jewelry form and the lender must have its complete entity.
- Your age must be at least 18 years or above: Only if you are 18 years old or older can you apply for a gold loan. Keeping a check on the legal age before applying is mandatory.
- Valid identity and Address proof: You would definitely need valid identity proof and address in order to verify the credentials.
- Stable income: Anyone who is applying for a Gold loan must have a stable or permanent source of income.
Tips to Remember Before Applying for a Gold Loan
There are certain significant points that you must remember before applying Gold Loan. And few of the most important points are given below:
- There could be a valuation charge which is usually waived by lenders who do have in-house valuation
- There are lenders who also charge a nominal processing fee. Now this fee could reach up to 1% of the gold value or the exact loan amount
- You could simply get your gold in case of theft or unforeseen or unfortunate circumstances.
- The KYC is required.
- The interest rate could vary from one lender to another and this ROI could range between 12% to 16%
Where Can I Avail a Gold Loan From?
Among the long list of apps, you can choose any reliable or authentic gold
loan app and apply for it. However, it is essential to check its credibility, such as whether it is trustworthy, dependable, and genuine. One of my relatives suggested I go for Bajaj Finserv. They have a very transparent lending process. The current rate is Rs. 4869/gm. The rates vary per the market fluctuations, starting from just 9.5% p.a. They also provide a gold loan calculator and even the facility to transfer the gold loan balance! This means your balance with the previous lender can be shifted to the new lender with lower interest rates.
Conclusion
Gold loans are among the quickest and simplest loans to apply for and seek, and this could be one reason for their escalating popularity. However, before you apply for one, you should consider a few significant points, such as the repayment structure, availability, benefits, and a few other important tips.
