In this article I will be writing about the a better idea for taking the loan using your idle jewelry in the locker. It would be the better option rather going for the personal loans or any other expensive options. Not many take the wise decision when it comes to the financial matters, this article explores the advantage of using the jewelry loans and different criteria involved in taking the gold loan. If this article helps you, please subscribe to our future articles here.
What you can Use?
All the banks accept the gold Jewell to give the loans. But, there are few private banks offer the loans for gold coins. Normally public banks accept only ornaments not any other form of gold like coins, biscuit, etc.
Types of Gold Loans
- In this type you will be given the entire loan amount as the lump sum and will be paying the loan when you have money. The interest will be added end of every month.
- If you have savings bank account in the bank, you can use this facility. When you are in the need of money, just withdraw from your account. You can withdraw money more than your account balance. The interest will be taken from your account end of every month. The advantage on this facility is, interest is calculated only the amount you have taken from the over draft facility.
Loan Amount & Cost
The amount you can get as the loan varies from 70% – 90% of the value of the Gold. It really depends on the bankers. RBI mentioned in the circular saying that give preference for the hallmark Jewell. It will encourage the hallmarking of Jewell.
Like any other loans, Gold loans come under fixed and floating interest rates. The interest rates vary between 8% to 24%. The duration of the loans ranging from 6 months to 2 years.
I hope this article would be very useful for those who want to take the loans for emergency need. Note that gold loans can be used for the emergency and short term needs because there is limit on the maximum loan amount. You can not take a loan to buy a house and repay it for 20 years. Gold loans are short term in nature. The main advantage is interest rates are lower compare to personal loans.
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