Top 10 Reasons Why a Gold Loan Is Your Best Bet for Financial Needs

India is one of the world’s biggest buyers of gold. The valuable metal can be used to acquire a loan in a cash crunch. Getting a gold loan is one of the best and fastest ways to get cash when you need it most.

Even though your credit score is low, if you have a lot of gold sitting in your locker, you may be able to get a gold loan. Gold loans are becoming more common each year, so it’s crucial to understand not only what they are but also how they work, how much interest they charge, and other specifics.

What is a gold loan?

Gold loans, often known as “loans against gold,” are secured loans in exchange for gold decorations, like jewelry, owned by the borrower. Lenders will typically allow you to borrow a sum that is a certain percentage of the value of the gold. After the necessary monthly payments, you will be given your gold items back.

Gold loans, in contrast to other secured loans like mortgages and auto loans, have no limitations on how the money can be used. Consequently, it is a wonderful solution to fulfill your unexpected money requirement, whether for a wedding, a family trip, or your child’s college. Furthermore, several private, and national banks and NBFCs provide gold loans with low interest rates.

What makes a gold loan the best choice when you need money fast?

Here are a few things that set the best gold loans against gold apart:

Fast approval

When talking about how easy it is to get the best gold loan, the first thing to point out is how quickly you can get approved. The main reason for this is that it is one of the few ways to get credit that requires the least amount of paperwork. After filling out the application online, borrowers can upload the documents they need to send.

Fast disbursal

Once the gold has been evaluated, the loan amount is given to the applicant within a few hours. On the other hand, it takes at least 24 hours to process and verify other financial products before the money can be sent out.

Simple criteria for eligibility

Compared to other types of loans, the requirements for getting a gold loan aren’t as strict. Here, people who want to borrow money can do so without having a high credit score or making more money each month than is required. But they have to make sure they are the right age and that their gold items are of the right quality.

Taking out a gold loan instead of a payday loan is a good idea because you won’t have to provide proof of income. Unlike with some secured and unsecured alternatives, borrowers don’t have to show this paperwork to get the emergency money they need.

Flexible repayments

The best thing about gold loans is how flexible the payments are. You don’t have to pay monthly instalments, pay back the loan based on how much money you have during the term. You can choose to only pay interest each month and pay off the loan at the end of the term. You could also pay the whole amount at the end of the payment period.

Extended repayment tenure

Gold loans take longer to pay back. The repayment tenure can be as long as 3–4 years. This allows you to plan your payments after you’ve taken care of the emergency. Still, paying back the loan as soon as possible is the best way to save money on interest.

Low rates of interest

Gold loans are usually less risky for a financial institution to give out because they are secured. Because of this, lenders offer a lower interest rate on it than they would on some unsecured loans.

Whether you need the money for an emergency or not, a low-interest rate is always good. It brings down the total amount you have to pay back, making handling your debt easier. Also, it doesn’t make a person’s finances harder.

Low processing costs

Most banks won’t charge you anything or only a small amount to process a gold loan.

Getting a gold loan is the best way to meet your financial needs because it gives you the financial flexibility you need without hurting your personal finances.

No limits on the end use

When talking about whether or not a gold loan is a good idea in an emergency, the fact that it can be used for anything is its most significant selling point. This means that borrowers can use these funds for various financial needs. It could be for personal costs, medical emergencies, or work-related needs. The lender will not step in to help with this.

Safekeeping of gold

You put your unused asset to work when you get a gold loan. It is safe in the vaults of banks and other financial institutions. It is also insured when the asset is saved with the lending institution. This means that if it is lost or stolen, you will get the total market value of your gold back.

Good interest rates

The interest rates on gold loans are low. Gold is reliable collateral for anyone. In India, interest rates on gold loans are usually between 12 and 14% per year, which makes them an affordable way to borrow money.

Conclusion

Applicants can get a lot out of gold loans. It lets you immediately get the credit you need and use the money you raise however you want. All of the good things about it are listed above. Piramal Finance offers gold loans with low-interest rates. If you want to take a gold loan with instant disbursal, visit their website!