Top Benefits of a Gold Loan in India

Gold is deeply connected to Indian culture and tradition and is considered auspicious. Indians mostly buy this precious metal in the form of coins and jewellery. However, there are other ways you can benefit from this auspicious metal. 

For instance, you can secure a loan using gold as collateral, an easy way to solve your long-term and short-term monetary crisis. Thus, if you are a loan seeker considering this option, here are some of the top benefits of a gold loan you must know.

Securing credit against your gold jewellery is one of the simplest and easiest methods to obtain funds, especially in an emergency financial crisis. Here are five gold loan benefits that can give you a reason to opt for one:

1. Quick and Hassle-free Processing

The gold loan is a secured loan type, considered less risky for lenders. The fact that you are pledging your gold as collateral keeps eligibility and documentation at a minimum. 

The overall processing time to get this credit type is much less than unsecured loans. As a result, you can find lenders processing your application within a few hours or a day. This makes it one of the quickest ways to secure funds during an emergency.

2. Low Interest Rates

Another advantage is that the gold loan interest rates are lower because of the collateral involved. You may find unsecured loans such as personal loans or credit card loans with higher interest rates comparably. 

Gold loans offer attractive interest rates, even compared to other secured options such as home loans, mortgage loans, etc. This is highly advantageous when you are opting for a greater amount. 

A minor difference in the interest rates can save you substantially for the entire tenure. Therefore, gold loans are a viable option if you want to secure ample funding with smaller monthly repayments.

3. Flexible Repayment Options

Based on your convenience, you can choose the tenure of the loan on gold and repay monthly, bi-annually, quarterly, or annually. 

With a gold loan available on Bajaj Markets, you can also enjoy the added benefit of zero foreclosure charges. This means you have the freedom to prepay your loan without incurring any extra fees. You can save on unnecessary expenses while securing the funds you need with ease.

4. No Need for Credit History

Unlike business or bike loans, a gold loan does not require an evaluation of your credit history or CIBIL score. As it is a secured loan backed by gold collateral, lenders do not need to assess your credit history. Even with a poor credit score or history, you can secure a gold loan quickly.

While the loan may require gold collateral of at least 18 karats, there is no need for a credit check, making it an accessible option for many. Nonetheless, it is preferable to ensure your credit score is considerably good. 

5. Secured Loan with Retained Ownership

After you repay the entire loan amount, the lender returns your gold assets. Furthermore, most lenders provide high security by storing your gold in secure vaults. This ensures that you can retrieve your gold after the loan tenure ends easily, without concerns about damage or theft.

6. No Income Proof Requirement

Among other advantages of a gold loan, one feature is that it requires minimal documentation. The documentation includes a KYC-based process, requiring only your address and identity proof. You do not need to submit any paperwork for income proof since you pledge the gold asset as security in exchange for the amount.

Bajaj Markets makes it easy and fast to fetch for lenders that help borrow funds without the hassle of a lengthy process. On this website, you can compare a range of gold loan lenders and their offers. This helps you find the best option with favourable loan terms.

With no need for income proof and flexible repayment options, getting a gold loan through Bajaj Markets is effortless.

Gold loans offer a convenient solution for fulfilling financial needs. As a secured loan, it does not require an assessment of income or credit history, which could make it an accessible choice for many. Below is a brief comparison of gold loans with other popular loan options:

To maximise the benefits of a gold loan, it is necessary that you check the interest rates and stay informed about the current market value. Some additional tips are listed below: 

• Compare Interest Rates

Research and compare the interest rates offered by different lenders. Since interest rates can vary, selecting the right one will help lower your repayment burden.

• Choose Flexible Repayment Options

To make your gold loan repayment easier, opt for a flexible repayment plan that suits your financial situation. This will help reduce your EMI burden and ensure smooth cash flow.

• Negotiate Processing Fees

If possible, negotiate the processing fees with your lender. Reducing these additional costs will lower the overall expense of your loan.

• Prepay When Possible

If your cash flow improves and you have enough funds, consider prepaying your gold loan. The sooner you repay, the sooner you can reclaim your gold assets. If prepayment is not an option, make sure to pay your EMIs on time.

• Monitor Gold Rates

Stay updated on the current gold rate. The loan amount you can get is directly linked to gold prices, so a higher gold rate means you can borrow a larger loan amount.

To get a loan through Bajaj Markets, you need to meet the qualification criteria set by lenders. The gold loan eligibility criteria in detail are listed below:

• Your age must be at least 18 years

• You must be an Indian citizen

• You can either be salaried, self-employed, farmer, trader, or entrepreneur

• The purity of your gold should be at least 18 karats

In case you want to find the estimated value of your loan, you can use a gold loan eligibility calculator online.