How Gold Loans Offer Financial Support in Times of Need
Gold loans are considered secured and banks use gold jewellery as collateral for loaning your desired amount. The process of obtaining a gold loan is convenient and hassle-free. You can avail up to 60-80% of the gold value as loan, depending on the lender. Due to increasing prices of gold, it is a commodity that consumers are likely to invest in for assured returns. Hence, it is advised that people prefer availing loans against the gold that they have instead of selling, when there is an immediate need for funds.
Below are a few ways in which gold loans can provide immediate financial support in times of need:
The disbursal of gold loans can be done quicker as compared to other loans. Since gold is used here as a collateral, banks face a lower risk of loss in case of any damages. Hence, banks are likely to process your loan quicker compared to personal loans, making it a good option during times of need.
There is no specific maximum tenure for gold loan repayment. However, the loan tenure varies from a few days to several years depending on the option you choose while availing the loan. The flexible loan tenure can be very useful if you are availing a gold loan during emergencies, as you can easily pay it back any time during the loan tenure.
There is no fixed option for paying off the loan against gold. You can pay the entire loan amount (Interest + Principal Amount) in lump sum or break the total amount into easy EMIs. The ability to choose your repayment mode can offer you flexibility in terms of arranging the necessary funds for repaying, as per your convenience and capability.
No Need for Credit Score
In case of emergencies, you might need immediate financial assistance. During such times, a bad credit score could be a major hurdle in availing loans. However, you don’t need to maintain a higher credit score to avail a gold loan. Since you are offering collateral in the form of gold, banks are more likely to overlook lower credit scores.