How gold loans can help you during this COVID 19 crisis?
How gold loans can help you during this COVID 19 crisis?
The yellow metal has always been something that has caught the fancy of generations and continues to do so.
The yellow metal has always been something that has caught the fancy of generations and continues to do so. For many, gold has been a saviour in their desperate times. Loan secured against the gold ornaments has been immensely popular as it's a loan that can be availed without much hassle. So how well is gold performing as collateral as the COVID crisis sends the economy crashing? Extremely well, we could say. Rising gold prices have added to the benefits as borrowers have become eligible for higher loan amounts.
A win-win situation
Lenders and borrowers equally vouch for this tested and tried financial mechanism. While lenders see gold as the safest asset to increase revenue, borrowers would find gold loan to be the most obvious choice to meet their short-term needs. Considering the current economic stand-still, lenders are going cautious on other loan products and looking to invest their time and resources to focus on gold loans making them one of the easiest loans available.
Benefits of gold loan
Lower Interest Rates
It wouldn't take more than a glance at the current market to realize that the interest rates on gold loan (ranging anywhere from 8-14%) are way lower than personal/other loans (12 - 30%). The difference is tremendous.
Prepayment Charges
Other loans require you to repay in fixed EMIs over a period of time. If you intend to prepay, you are usually charged a prepayment amount which comes around 2% of the current outstanding principal amount. Here is where gold loan turns a real benefactor. You can repay any amount and close your loan account anytime.
Gold loans and EMI
Worried about EMIs? Well, you don't have to, not always. Gold loans gift you the privilege to go for a NO EMI option. You can keep paying only the interest and your loan account will stay active for years without a hindrance. This comes really handy in desperate times when you are low at income or in case of an emergency when you are facing an acute shortage of money.
Eligibility
Do we even have to mention about eligibility? Unlike personal loans that bring your earnings, salary etc. under scrutiny in the process of checking your eligibility, gold loan is just based on the value of gold that you are pledging.
So sit back and relax. If you are looking out for options to meet your short-term/long-term needs, urgent or not, you can always go for a gold loan. You stand a chance to receive a loan of up to 70% of the current market value. This could go way high up to 90%. Of course, the amount is subject to change depending on the bank/company.
