Everything to know about gold loans

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Everything to know about gold loans
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Gold Loan

• These are secured loans that are offered by
  almost all financial institutions nowadays.
  Although this concept originated in the
  pre-independence era in a comparatively
  unstructured manner, it has now evolved into an
  important financial product that some financial
  institutions are highly trusted. Owed to the
  relatively more hassle-free procedure of getting
  these loans, most people prefer gold loans over
  other types of loans.

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Who can apply for a gold loan?

• Ideally, anybody who has valid documents to
  present and gold to keep as collateral can apply
  for this loan. Since this loan does not need
  proof of income or past financial details,
  literally all kinds of people can apply for it.
  It is however seen that people running businesses
  apply for these loans as they often need quick
  capital without having to run around for all the
  documentation and paperwork. People in various
  other professions can also apply for this loan as
  they do not need any proof of employment or
  income.

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What is a gold Loan?

• This is a secured loan wherein the bank or
  financial institution keeps the gold as
  collateral and lends money. Here, the gold acts
  as security again and the borrower gets the money
  without showing any proof of income or ITR. The
  bank calls for an evaluator who assesses the
  quality of your gold and then tells the bank its
  value in INR. Based on this evaluation the bank
  lends the money, which is usually 90 of the gold
  value. It is also important to know that the
  banks do not consider the value of precious
  stones etc. that may be embedded in the jewellery
  and always consider the value after deducting the
  weight of these embellishments.

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When to apply for a gold loan

• An individual should apply for a gold loan if
  he/she is in dire need of cash at a short notice
  and has the means to re-pay the borrowed money.
  Also, before opting for the loan, people can also
  use the gold loan monthly interest calculator and
  self-evaluate their potential to repay that.
  Mostly, this loan comes in very handy for
  businesses when a sudden need for some liquid
  money arises or during medical emergencies.
  Reputed financial institutions ensure that people
  can get a gold loan without much hassle and their
  belongings are stored away safely till the loan
  term.