Gold loans are simple loans one can avail of by depositing their gold to the bank. The bank will then give some amount of money, depending on the price and demand of the gold being provided. Once the loan is provided, the individual has to repay the amount to the bank, failure to do which, will pass the ownership of the gold to the bank. There has been a rise in demand for gold loans as prices have been soaring above Rs. 50,000 per 10 gram, in India.
The Reserve Bank of India (RBI) has allowed an increase in the Loan to Value ratio, also known as LTV, for loans against pledged goals from 75 percent to 90 percent till the 31st of March, 2021. Therefore, anyone who is looking to go through the pandemic, are borrowing higher sums of money through gold loans. The interest rates charged by banks and non-banking financial companies (NBFCs), on gold loans are lower compared to unsecured personal loans, which are devoid of any collaterals. This acts as an advantage for the borrowers.
While applying for a gold loan, you need to carry your gold to the lender for measuring and verifying. You may also need an ID proof for the verification process. Some banks however do not ask for such documents but many do. Therefore, it is useful to carry one in your person. Banks like Kotak Mahindra Bank gives a loan amount that ranges from Rs. 20,000 to Rs. 25 lakh. The tenure of gold loans is also longer than most, ranging from three months to thirty-six months, depending on the banks.
A public sector bank should be your first choice for a gold loan as it provides a cheaper interest rate as compared to any private bank or non-banking financial companies. Public Sector banks like the State Bank of India give an interest rate of 7.50%.
Gold loans, therefore, can be a good option for you to cover the big expense. However, doing extensive research and checking the details of the banks is of utmost importance.
Taking a loan is stressful and there are many questions that people ponder over when it comes to taking a loan. Dialabank comes to your aid and helps you with your loan scheme. So stop fretting and call 9878981144.