People often take gold loans to meet some unwarranted expenses. One of the best perks of getting a gold loan is that it can provide you instant credit if you meet all the conditions of the lender. If you want to figure out the cost of your loan you can use a gold loan calculator to calculate the amount that you will get for a specific grams of Gold. Mentioned below are some things that you should know before taking a gold loan:
- Repayment Plan
The repayment options for a gold loan are convenient. For example, some lenders may ask you to pay only the interest amount during tenure and the principal amount at the end of the term. While other lenders do not apply any prepayment or foreclosure charges on short-term loans. You can find this out by comparing the terms and conditions of the top lenders and then making your final decision. In some cases, you can even get back some of the collateral by paying the designated amount. It makes it easier for you to reclaim your assets without any worries.
- Eligibility Criteria
If you want to take this loan you should be an Indian citizen, your age must be above 21 years, and the purity of gold that you give as collateral should be 22 Karat. The purity of gold plays a crucial role in deciding the amount that you will get against the collateral. Unlike other loans, you do not need to show your income proof and credit score to be eligible.
- Suitable Gold Items
You can only keep gold jewellery items like necklaces, earrings, bangles, rings, etc., as collateral to get a loan from a bank or non-banking financial company. Items such as gold bars, idols or utensils cannot be given as collateral.
You can take a gold loan while planning a wedding, manage educational expenses, and pay hefty medical bills in an emergency. It can also be used to meet your business requirements in case of unforeseen circumstances like layoffs, a pandemic, natural disasters, etc.
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