Going several years, India has been one of the world’s largest gold consumers. While gold typically gets purchased for ornamental purposes, the most common reason for purchase remains investment. Gold is the perfect investment because of its stability, even during inflation. In times of need, gold is an excellent resource for quick loans. In fact, because of the ease with which one can obtain gold loans, it can be one of the fastest ways to acquire funds. Even if a person has a low credit score but a substantial amount of gold in their locker, they can obtain gold loans with little difficulty.
WHAT IS A GOLD LOAN?
A gold loan, also known as a loan against gold, is a secured loan obtained from a lender in exchange for gold ornaments such as gold jewelry. Lenders will typically grant you a loan based on a percentage of the value of the gold. You can repay it in monthly installments and receive your gold items back.
Unlike other secured loans, such as a home or car loan, there are no restrictions on how you can use gold loans. So, whether it’s for a wedding, a family vacation, or your child’s education, it’s an excellent opportunity to meet a sudden financial need. Furthermore, many private and nationalized banks, and NBFCs, provide gold loans at low-interest rates.
BENEFITS OF A GOLD LOAN
At first, obtaining a gold loan may appear to be straightforward. You may believe that all you need to do is walk into a reputable gold lender’s showroom and pledge your gold in exchange for a large sum of money. However, there are some things you should know before applying for a gold loan. Knowing this beforehand will enable you to reap the benefit of your gold and ensure its safety and ability to repay the gold loan and collect your gold back.
You may be wondering whether a gold loan is preferable to the other types of loans available in the market today. Here are some advantages of gold loans:
- Obtaining a gold loan requires very little documentation.
- The interest rates on gold loans are significantly lower than those on personal loans and similar unsecured loans.
- When applying for a gold loan, you don’t have to worry about your credit history, employment history, age, or anything else.
- There is no need to submit any income or credit history document.
- There are various repayment options available.
- There is generally no prepayment penalty on gold loans, though some lenders may charge up to 1% of the outstanding loan amount as a penalty.
HOW DOES A GOLD LOAN WORK?
The gold loan application process is similar to that of other secured loans. In the case of a gold loan, you take your gold items to a lender with the required documents. The lender assesses the gold articles and authenticates the submitted copies. The lender approves the loan amount based on the evaluations. According to the loan agreement, you repay the principal and interest amount and receive the pledged gold articles back.
WHERE TO AVAIL OF A GOLD LOAN?
While India hosts many small-time jewelers or pawn shops, it is better to acquire a gold loan from a reputable bank or Non-Banking Financial Company (NBFC) regulated by the Government of India. It ensures that your gold is secure. Some NBFCs specialize in gold loans and offer more attractive interest rates and other features. Before deciding where to get a gold loan, compare the features and interest rates of various banks and NBFCs.
HOW TO DETERMINE YOUR ELIGIBILITY FOR A GOLD LOAN?
A gold loan remains available to anyone who owns gold. Unlike personal loans, which have strict eligibility requirements, gold loans are obtainable to any Indian resident, including salaried professionals, business people, stay-at-home parents, and even farmers. You don’t need a good credit score to qualify for a gold loan. So, if you have a low credit score, you can still get funds if you have enough gold to pledge.
WHY CHOOSE MAG FINSERV TO AVAIL OF A GOLD LOAN?
MAG Finserv, initiated in 2008, understands the urgency of funds tangled with the emotional value of a debtor. With this thought in mind, MAG Finserv crafted a loan against gold service that apprehends your financial needs and offers you a safe, trustworthy, quick, and hassle-free customer experience.
We expedite the Gold Loan process by requiring minimal documentation and providing you with the maximum loan amount on an immediate loan approval basis for a repayment period of up to one year. Along with this, we provide a slew of other significant advantages for taking a Gold Loan from us.
You can visit our website to learn more about the Gold Loan we offer and the application process, or you can even get in touch with us for further information through the contact us form.
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