Gold has always been an important form of investment in India. People buy it on festivals and gift it on special occasions like weddings, birthdays, and anniversaries. This precious metal increases in value over time since gold rates usually increase year after year. Most Indian families have gold jewelry in their houses or bank lockers. In times of financial need, they can pledge this gold to lenders and use the value locked in it. However, here are the five most crucial things you must be aware of before applying for a gold loan.
1.Type of Gold That You May Pledge
You may pledge any gold asset, including gold coins, bullion, and jewellery. However, you must check the gold’s purity before offering it as collateral. The minimum purity that lenders accept is 18 carats. Besides that, if the gold jewellery you offer has precious stones or gems in it, the lender will reduce their weight and value while deciding your loan amount. They will consider only the gold's worth that you offer. The Muthoot gold loan calculator helps you determine the loan amount you are eligible for, depending on the weight and purity of the gold assets and the market rate.
2.No Credit Score Requirement
Most lenders check your credit score before determining your loan amount and interest rate. However, since a gold loan is a secured loan, your credit score does not matter while availing it. When you put your gold as collateral, the lenders are least worried about your loan repayment. If you fail to repay your borrowed amount, they can sell your gold and get their money back. So, they do not give much attention to your credit score to approve gold loans.
3.Repayment Process
Most lenders have a flexible repayment process that borrowers can select according to their available funds and repayment capacity. You may pay the interest now and the principal later, interest only and the principal amount at the loan term-end, pay both principal and interest after a year, or through regular EMIs. The lenders give you sufficient time to pay your EMIs, and you may choose your loan term using a Muthoot gold loan calculator.
4. Eligibility Conditions
Eligibility conditions to apply for a gold loan are pretty simple. As far as the gold assets are 18 to 24 carats in purity, any individual between 21 and 65 years can borrow up to 75% of the gold price. Individuals with low income and no credit history can also apply for these loans, as many lenders do not ask for any income proof or credit score from loan applicants.
5.The Risk Factor
Determine the risk factor before applying for gold finance. If you fail to repay your loan, you may lose your gold forever. Therefore, assess the risk factor and make a repayment plan to keep your gold safe.
A gold loan is one of the easiest and fastest loans you may avail of to cover your urgent expenses. Knowing these important things will help you make the right decision while ensuring that your gold assets are safe and secure.
Muthoot Finance provides a higher loan amount which means you can fund any emergency need with a personal loan.
Once a borrower gets a nod from Muthoot Finance for loan approval, the disbursal becomes too easy.
As soon as the borrower uploads the necessary documents, he can get a quick disbursal.
By opting for a Muthoot Finance personal loan, a borrower can choose a flexible tenure for the loan repayment.
They offer a tenure up to 60 months which means you can plan your repayment conveniently.
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Use our loan calculator and find the loan plan that suits your loan requirements.
https://rupeek.com/blog/things-to-know-about-gold-loan-renewal/If you have repaid your loan amount in full along with the interest, you can take out another gold loan with the same lender, pledging the same gold assets.
