Complete Guide To Gold Loan Renewal Process 

Many people are struggling to fulfil their daily requirements. That’s because the global economy is showing a downturn due to the pandemic. In these circumstances, a gold loan is the only way to help you meet your financial obligations. 

A gold loan is an unsecured personal loan for people who want to borrow money for personal use. It is taken by people looking to buy physical gold or silver and then sell these precious metals to get back the investment amount with some profits.

So, if you currently have a gold loan, you can request a renewal process rather than taking a new loan. A “gold loan renewal” procedure will enable you to extend your agreement with a gold lender. The renewal process can be a little complicated for some people, but this article will simplify it for you!

What Is A Gold Loan? 

In exchange for gold jewellery, you can obtain a secured loan known as a “gold loan” from the lender. It is also a source of financing that you may obtain from the lender in exchange for 18 to 24 carats of gold as security. With this, you receive high loan-to-value payments. 

Gold loan interest rates range from 9.24% to 17%. However, it may vary depending on the lender. These rates are generally lower than those for unsecured loans because the lender has security or collateral against them. Furthermore, you always have the option to cancel this loan at any time. 

The good news is that most lenders do not charge fees for gold loans that go into foreclosure. But a few charge between 2-4% of the unpaid principal amount. However, there are benefits of gold loans.

Let’s now discover some of them here.

Uses of the Best Gold Loan

Gold loans are a popular form of financing in India. They can finance anything – be it gold, silver, real estate, stock markets, or any other asset that has value. The best part is that the bank won’t track how it’s utilised. Hence, you can use it for whatever personal financial requirements. 

Some of its uses are listed here: 

• Family vacations
• Wedding-related costs
• Covering unplanned medical costs
• Children’s education 
• Buying the home equipment
• House renovations

Benefits Of Gold Loan

• You have the option of repaying your loan over time with cheaper EMIs.
• You immediately have access to money with this loan.
• It has a variable tenure, but you can repay over six or twelve months.
• You can apply for gold loans when you need financial help in any emergency.

Eligibility Criteria For The Best Gold Loans

• You must be at least 18 years old to qualify for the eligibility criteria for a gold loan.
• Your source of income must be stable. 

How do I Apply for a Gold Loan?

Simple methods to apply for this loan are as follows:

• Check out the Piramal Finance website.
• Look for “gold loans” and tap on its button.
• Type your personal details and the desired loan amount.
• Verify your mobile number with OTP sent to your cell phone.
• Fill out and submit the loan application.

What are the Documents Required For Taking A Gold Loan?

For your convenience, here’s a compiled list of the important documents you’ll need to take a gold loan.

• An Adhaar card for identity proof
• Passport 
• Latest photo
• Agri Occupation Documentation if you are an agriculture customer
• Voter card
• Driving license 

How Should You Start Gold Loan Renewal Process?

Taking the new gold loan has become hassle-free. It guarantees that the borrower receives money immediately. That’s because the banks are already aware of the eligibility requirements. They perform background checks on the applicants. In case of default, they don’t allow you to renew your gold loan. 

What does the renewal of gold loans mean? Let’s get into it right away!

Renewal of a gold loan refers to extending the current loan agreement with the lender. Depending on your history of on-time payments, the lender, such as banks, may decide to renew your loan at a reduced gold loan interest rate. Various lenders have different procedures for renewing gold loans. However, here are the common steps you should follow to make this daunting task easier.

The steps involved in renewing a gold loan are as follows: 

• Check with your lender to find out if there are more document requirements than what was set when you first got your loan. This could happen if prices or policies have changed over time.
• Once you know the necessary documents, ensure all your paperwork is up to date. Lenders often require copies of your income tax returns and any other documents they may need to verify eligibility.
• Open the website of the lender and search for gold loans.
• Create an account and verify your phone number with OTP.
• To confirm the OTP on the lender’s website, enter all your details, including birthdate, email address, username, etc. 
• Remember to enter the amount you need as a loan. 
• The lender will require your identification documents. So, you should provide these documents to finish your KYC. 
• The lender will check and approve your application once you’ve submitted it and filled out your customer information. 
• After your application for a gold loan renewal is accepted, you will receive the approved loan amount in your bank account.

Conclusion

A gold loan is a type of loan in which you borrow money against the security of your jewellery. The companies lend you money based on the current market price of gold and charge a gold loan interest rate for the same. However, if you have already taken this loan and wish to apply for another one, you can choose the renewal option. A few things to keep in mind before starting the renewal process are mentioned in this post.

Today, customers have a variety of gold loans with low-interest rates. However, it might occasionally take work to choose the best gold loan and the lender. No worries. 

To help you, Piramal Finance offers loans with the lowest interest rates. So, check the options on the website and stay worried free when you are short on money.