Easy Tips To Get Gold Loan

2019/02/25

Gold Loan is the latest and the fast catching way to get money for investments. Today many banks and financial institutions have started this facility where you can keep your gold ornaments with them and in return get money on loan. Gold is becoming the most precious metal day by day and the soaring prices of gold are making it much more dearer and stronger metal.

That is why the banks and the financial institutions are realising the power of gold and they are launching new and lucrative schemes to attract customers to lend their gold to them and in return they will give them money on loan.

Changing trends of Gold Loan

Earlier whenever we needed money or cash we used to go to the local landlords or gold smiths and used to keep our ornaments with them in return for petty cash. In these cases there were chances of cheating, low lending rates and low cash benefits too. But now since the banks have started this facility, here your ornament will be in safe hands and secondly you will get better returns too. Whenever you want you can return the money taken on loan to the back and take your gold ornaments back from them.

Companies and banks in the field of Gold Loan

In the field of gold loan HDFC bank, Muthoot Finance and Mannapuram Gold are few financial institutions which are very active and give best deals to the customers. Kaaveri Finance is another financial institution which also gives nice returns on gold. All these banks and financial institutions are promoting and giving nice and profitable deals on gold loans. These days you might be getting SMSes too on your mobile phones for gold loans along with the advertisements on TV and hoardings.

How to get Gold Loan

First when you bring your gold ornaments there are Gold Evaluators in every bank or financial institution’s branch where they give gold loans. This Gold evaluator will evaluate the jewellery which the customer brings and once the valuation is done within 30 minutes after filling up some forms and doing some formalities you can get the gold loan very easily.

Some companies even guarantee that they can approve gold loan in one minute only. However this is too less time to do the paper work also. But every branch which gives gold loan has an expert to assess the quality and the worth of the gold that you bring for loan. On the basis of carat and weight the value of the gold is being estimated by the Gold evaluator.

Things needed for gold loan

Bank customers’ ID proof
Signature proof of the customer
Current account with the bank
Residence proof of the customer

All these things are necessary in order to verify and certify the gold loan. Generally the loan amount approved is 75-90% of the estimated value of the gold that the customer brings. If you have a savings or a salary account with the bank then you can get some additional benefits too on gold loan.

Like a new bank customer with savings account with the bank can easily get 70-80 % of gold  loan on the estimated value of the gold , where as any old client can get up to 95% gold  loan on the assessed price of the gold. Thus it is suggested that either you take gold loan from the bank where you already have an account so that you can get better loan amount or you can also open a current savings account in the bank from which you are planning to take the gold loan.

Interest rates on gold loan

Different banks and non financial institutions have different rates for gold loan. Generally most of the banks and non financial institutions give gold loan at the rate of 12-15 %. However the time period for the loan might vary in different banks and financial institutions. HDFC bank gives gold loan for six months, which can be renewed at higher rate of interest or after paying some penalty. Whereas other financial institutions give the gold loan on weekly or daily basis also to the customers.

All the banks and the financial institutions take the interest on  given gold loan amount in the form of EMI’s, but in case of new customers the interest is deducted from the gold loan amount only before giving it to the customer. The customer can return the loan amount along with the interest whenever he wants and can take back the gold he has kept with the bank, the bank does not charge any kind of penalty on pre payment of the loan, however if you are late in paying the loan amount then there will be an extra surcharge that you will have to pay to the bank.

Things on which you can get gold loan

It is not just the gold jewellery that you can get gold loan on, you can get gold loan on gold coins or gold certificates too from the banks and non financial institutions. Gold coins and gold certificates also give the same rate of gold loan as the gold jewelery or ornaments and they are also first evaluated by the Gold evaluator and then the amount of loan is decided based on that. HDFC bank gives a special benefit on the gold coins bought from the bank itself.

It gives 100 percent loan amount on the gold coins which are bought from the HDFC bank only. Thus it is a good option to buy the gold coins from the bank and get the gold loan on these coins only, so that you can get more return from the gold. Always remember it is better to take gold loan from these private banks and financial institutions than taking it from any local jeweller or gold smith as there are chances of cheating and you might get lesser returns too. So it is advisable that you should take gold loans from reputed banks and institutions only in order to get back your gold safely and to avoid any kind of fraud.

Photo Credit: Surethingads.com

featured personal-finance

MORE ABOUT Easy Tips To Get Gold Loan

Historia amp

1