The income of most of the middle class families had squeezed due to job loss, pay cuts and undefined income resources with the closing of business amid Coronavirus pandemic lockdown, more and more individuals are opting for gold loan. Some people need cash to run their monthly expenses while others have to pay the bill. People are not applying or moratorium as it will end up in loan burden with the accumulated interest. Those who needed money for their survival are mortgaging their gold to arrange funds in shortest possible time. Now the lockdown has uplifted, people are searching for the lenders for gold loan to get cash in hand. There are some factors which have increased the demand of “Loan Against Gold“.

Lower rate of interest: It is much cheaper to secure a gold loan than borrowing a personal loan and credit cards which costs huge and results in debt trap if not managed properly because the interest rate on personal loan and credit card ranges from 12 to 16% and from 15 to 30% per annum respectively. If the borrower is not able to repay the loan, it will end up in huge accumulated interest, stress and lastly, it can end up borrowing again to pay back the existing loan.

Surging of the gold price: Gold loans are easily available and comparatively cheaper and you can secure the funds in short time. Apart from such benefits, the huge surge in gold prices which make it more attractive and affordable. The domesticated gold prices have kept on rising sharply in last couple of months. The soaring prices in lockdown have unlocked huge value for gold mortgages for potential loan seekers who are looking for funds and since prices of gold at are at peak mortgaging their yellow metal which can get them the best of the price.

Increased LTV ratio: The gold loan lenders surged after RBI decided to ascend the permissible loan to value ratio (LTV) for loans against gold to 85% from 75%. This aspect of gold loan has made it favorable for individuals who are financially hit by COVID-19 pandemic and are looking for liquid funds to meet their requirements.

Instant processing: When you “Apply For Gold Loan“ lenders evaluate it and credit the loan amount into your account and hold your metal until you repay it back. Nowadays lenders disburse the loan in few hours after you get approved for it and some of them have eliminated processing fees too.

Now when lockdown has been lifted, the gold loan sector is expecting an increase in demand for loans against gold as majority of middle class families are looking for liquid funds and working capital to push their businesses to normal which are hit by the corona virus pandemic crisis lockdown. Therefore, get in touch with ShubhBank for quick and hassle-free ways of getting a gold loan. Your gold will remain at secure place with lender throughout the tenure and you get it back, once you repay it back to the lender.

In recent times, there has been constant rise in gold prices since June 2020. Although, whole world has taken a setback in this ongoing pandemic, but gold is shining brighter with each passing day. From last couple of months, small businesses and shops are suffering losses, now it’s time for them to get their businesses back on track. With the passing guidelines of resuming businesses, business owners and shop owners are turning to loan against gold to meet the working capital requirements such as procuring raw materials, operational liabilities and others.

In a current situation, gold loan is the convenient option as the borrower has to pledge their yellow metal as collateral to avail loan. Due to increase in gold prices, people are taking advantage of rising rates to secure big loan quantum, that’s why gold loan is shining in the current situation. The growth in demand is due to the large number of people associated with small factories, shops, farming etc. need to survive their work post the unlock phase. There are some considerable factors enlisted below which shows gold loan will still not fade.

⇒ Loan Quantum: If you are taking a gold loan, your chances of getting a higher loan quantum increases as the price of gold are recorded to be at their peak value, these days. Financial institutions are at ease while lending loan against gold because the reason being that you are pledging your gold as collateral. The maximum limit of loan money depends upon the quantity and quality of your metal as the lenders are offering 75% LTV ratio on the pledged gold.

⇒ No Credit History required: This is the valuable aspect of availing a gold loan as you do not need to have any credit history. Even if your credit score is not good while you “Apply For Gold Loan“ you shall be granted the loan because lender can recover the outstanding amount by selling your pledged gold, in case of any default.

⇒ Minimal Documentation: You only require basic KYC documents while taking a loan against gold and you will get a great feature of flexible repayment options too. Most of the lenders offer easy loan processing and sanction the loan instantly in few minutes and disbursal within few hours with nominal documentation.

⇒ Smart Interest Rates: The best feature of gold is that it is offered on lowest possible rates of interest as you have pledged your yellow metal with lender decreasing the potential risk of any default.

The financial institution are coming up with great deals to lure loan seekers for taking a gold loan with the increasing demand in lending sector. Various NBFCs and banks are curating towards reaching out to maximum audience by digital lending platforms, online gold loan and insurance of gold and doorstep services among other to serve the potential loan seekers. If you wish to “Apply For Gold Loan Online“ from ShubhBank to resume your business operations or to fulfill your requirements, click on ShubhBank.com.

Gold loans are the straight forward method of raising money in case of an emergency. If you need urgent money for marriage or festivals or travel, you can formally go fall for the power of gold. You can mortgage your gold ornaments to the bank and financial institutions. You do not need to sell the gold ornaments in the market; you can simply mortgage it to the moneylender. However very often people make some fundamentals mistakes while “Apply For Gold Loan“.

1. Lenders Credibility: – A major blunder that people commit is taking a loan without checking lenders credibility. In a gold loan, you have cash in hand but for that, you have pledged your gold ornaments. Therefore the risk is more on the borrower as compared to the lender. You must check the background of lenders. A gold loan can be risky as a gold ornament will be kept by the lender till you pay the whole amount. So you must take a gold loan from reputed banks or financial institutions as they abided by RBI regulations.

2. Less Research: – You would be doing less research while applying for the loan. When you search online you will get many websites showing you interest rates or processing fees but take your time. Do not run for choosing the first offer. The more you will search, you will get better options.

3. Negligence of repayment structure: – Another common mistake is the negligence of the repayment structure. It is extremely important to study these structures and select the best one for yourself. Check your liquidity of cash flow so that you can pay the EMI amount other you will end up losing your gold jewelry. There are many options for paying the loan amount like Regular EMI, Only Interest EMI, and Partial repayment, Bullet repayment. You can select the best suitable method by yourself.

4. Read all conditions: – Before applying for a gold loan always remember the devil lies in the detail. So get the clear aspect of loan to value calculation. Borrowers must understand how the bank or financial institutions in calculating the value of your gold and based on that you will get the amount of loan. As a borrower, you need to have a good idea about the market value of gold. Mostly Bank offers loans at 22 carats of gold or above. If the gold ornaments are less or impure then the loan can be rejected. Gold coins are also accepted if they are above they can be accepted as collateral.

5. Not Checking prepayment charges: – While lenders do charge any prepayment fee for a “Gold Loan“ but some charge some 2.5% from the outstanding amount if you pay before the tenure period. The prime objective of making prepayments is to save on the interest cost; incurring prepayment penalties would reduce the benefit from making prepayments. Hence, opt for a lender that charges minimal or no prepayment/ foreclosure fee.

To conclude you must remember all the above-mentioned points while applying for a gold loan.

Gold loans are the convenient and straight forward method of raising the funds in emergency situations. Gold is usually secured in the forms of ornaments and jewelry often comes to the rescue whether you need it for wedding expenses, travelling or starting up a new venture. Many of the banks and NBFCs are in competition to give gold loan with great benefits and you can monetize your yellow metal without selling it in the market. However, many a times people get misguided, therefore needed to look after few mistakes to avoid while applying for a gold loan.

MISTAKES TO AVOID WHILE SECURING A GOLD LOAN
– A major setback proved for the borrower is not to check the lender’s credibility. The loan quantum in gold loan is based upon the fraction of gold that you have pledged to the lending institution resulting in the increased risk factor for borrower than the lender. Therefore, you must check the background of the chosen financial entity as you have to place your gold as collateral to the lender till the time you repay the borrowed amount back. Always choose a well-established lending institution that is regulated by RBI for gold loans.

– The other common mistake made by loan seekers is not comparing the lenders in the market. If you want to compare then you can use any of the aggregator websites as many of the lenders would be ready to give the loan amount evaluated on the basis of your gold. When you “Apply For Gold Loan“ never go for the first offer because more you compare, better the offer you may find. Always choose a lender who offers lower interest rate or higher LTV ratio.

– There is another point that needed to be avoided is being negligent of repayment structure. It is always important to understand the structure and zero in on the best that matches your needs. Be sure about the requisite liquidity and how you are going to repay either in the form of EMIs or bullet payments otherwise you could lose your gold ornaments.

– It is important to get into the finer aspects of loan to value calculation while you “Apply For Online Gold Loan“ or apply it offline. Most of the lending institutions rely on the data furnished by their central office to evaluate the gold and to grant you a loan for up to 70% of its market value. Being a smart borrower, you must have a good idea about the market value of your gold. However, quite often these values are flexible.

At the end, you must check upon the fine print of gold loan as yellow metal has more sentimental value and ensures disciplined repayment from the borrower. Do keep in mind the conditions in which your lender can possess the gold and auction it in case of any default or any prepayment charges if you close the loan before the tenure ends. Make sure to discuss all these aspects to have a safer and convenient loan journey.

It is always a mind boggling to decide over, whether to sell the gold or to take a loan against gold when someone needs money and he/she doesn’t know what needs to be done. Many thoughts start juggling throughout minds and questions surround us that should I sell my gold, will I get the right value of my yellow metal or should I apply for a gold loan? Here in this article, we will guide you about that which is the best option- selling your gold or gold loan?

Gold is not just a shiny ornament but it also carries feelings, legacy and emotions than just being an asset. Therefore, most of the people are hesitant about giving away their asset when there is a need of funds. It is always a better option to take a gold loan if someone wants to use it. The main disadvantage of selling gold is that you are only paid for jewelry and you lose the value of make in charges which adds up as significant part while purchasing the same jewelry. The emotional sentiments also counts up as one thinks to start when he/she will be able to buy the gold back while the gold prices are increasing.

Benefits of choosing a gold loan
Gold loan is the secured type of loan, where the lender only look for quality and quantity of your gold rather than your creditworthiness when you “Apply For Gold Loan“ and sanction the amount in your bank account as per your requirement. Once you clear the repayment, you can get your gold ornaments back. This loan will save your time and unnecessary stress of selling your asset which you are not being able to buy soon. Some of the benefits associated with this loan are given below:

Higher Loan Amount: You can get higher loan amount in case of gold loan as it is a secured loan. The maximum limit of gold depends upon the quantity, you pledge against it.

No Need of Credit History: This is the major benefit of availing a gold loan as one need not to have a credit history. Even if you have a low or zero credit score, you shall be granted with loan. If you default on repayments, then lender can recover the outstanding money by selling your gold.

Nominal documentation: One only needs to provide the KYC documents either you “Apply For Online Gold Loan“ or offline. With nominal paperwork, loan amount is sanctioned quickly within a short period of time. Gold is an over the counter product, just pledge your gold ornaments with lender and walk out with cash.

You can take a gold loan by paying very less interest rates and your precious metal will also be in safe custody. Therefore, if one needs to fulfill their requirements or to fund any emergencies, then taking a gold loan is better option than selling your gold. The loan processing is very easy and will be completed in less time.