Reason to Consider Gold Loan Over Other Loans
Gold is a prevalent investment option, used as both, a saving and a borrowing tool. A gold loan is excellent for quick financing. You can get this loan by pledging gold ornaments as collateral. The loan amount equals a fixed percentage of the gold’s value. The repayment of such loans can be made in fixed monthly installments, part payments and bullet payments as per your comfort.
There are many factors you must consider before you avail of gold loans. These include purity of gold, evaluation of the actual value of gold after removal of impurities, and the ongoing market price. On complete repayments of the loan, the borrower can take possession of the gold particles. So, let us understand the benefits of such loans over other loans.
Lower Rates of Interest
When choosing any kind of loan facility, the interest rate comes across as a vital factor. Gold loans, being secured loans, always come at lower interest rates compared to other loans. During the process of availing of these loans, you must hand over your gold to the lender, which leads to lesser credit risk. This is the primary reason for the reduced interest rates. Lowered interest rates have lower repayment amounts, putting a lesser financial burden. With Muthoot gold loans, you do not have to go through any hassle of negotiation. We offer the best gold loan interest rates in the market.
Higher Loan to Value Ratio
Whenever you decide to opt for a loan facility, you should always look for the loan amount. Choosing a loan against gold satisfies all your needs, as it enables you to get higher loan amounts. You must keep in mind the loan to value ratio that the lender provides. Muthoot Fincorp offers a gold loan ranging from 65% to 75% of the overall gold value based on the collateral’s purity. You can also top up the loans when in need of extra funds.
Variety of Repayment Options
When you choose a gold loan, you get access to more than one repayment option, which helps you pay the required loan amounts in due time. Having the freedom to choose a repayment option as per your suitability and financial capacity is why people go for these loans. Broadly there are four types of repayment options- Equated monthly installments, payment of interest at regular intervals (be it monthly, quarterly, yearly), Upfront Interest payment, and Bullet Repayment method.
One of the significant advantages of getting a loan against gold is that there is no limitation on using them. Therefore, you can use them for fulfilling any of your requirements, be it for medical emergencies, business growth, vehicle down payments or agricultural needs. This freedom is also one of the reasons for gold loans being so popular and widely chosen by the customers.
There are no strict eligibility criteria for availing such loans like credit history and CIBIL scores. The loan amount is usually based on the value and the purity of the gold you are willing to give to your lender. You can simply use a gold loan calculator to compute the maximum amount.
The easy and minimum requirement for documents is why you should go for these loans. Some essential documents like KYC forms and passport-size photographs are required.
Easy and Instant Finance
If you are in a hurry to avail of a loan as soon as possible, choosing a gold loan is your stop. For this, you have to visit the branch and submit your ornaments. You will be notified of the maximum amount within a day. The value of your goods will be assessed, and the loan amount will be decided accordingly. After that, the documentation process is done, which is very simple. Then, your loan will be authenticated. Successful completion of these steps will lead to the disbursal of the required loan amount into your account.
Safety of your Gold
The gold you hand over to us is kept in full-proof lockers; hence they are safe. These lockers are safer than the ones at your home. The safe rooms are monitored 24*7, and the gold you deposit to us is also insured. After the payment of the outstanding amount, your gold is returned to you. Hence you can be doubly sure of your gold’s safety.
At Muthoot FinCorp, the ornaments are placed in safe rooms with CCTV cameras to ensure safety and security. It is prevalent for availing loans against gold at the lowest interest rates. Furthermore, it offers gold loan schemes that borrowers can select as per their needs. It also provides you access to unique features such as -cashback and digital payments.