Most of the time a gold loan is an excellent way to meet your short-term cash needs. Banks and other institutions now do spot assessments and valuations of your gold in order to determine loan eligibility, which is followed by loan disbursement.
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Many banks provide simple repayment options such as monthly interest payments and principal payback at the conclusion of the term. Gold loans are sanctioned against your gold or jewellery holdings. Personal loans and credit cards are sanctioned on the basis of your income proof and repayment capacity. Gold loans are available in tenures that vary between 6 to 12 months depending on the bank.
Interest rates on these gold loan differ depending on the bank and other factors. Here are top ten banks offering lowest interest rates.
How soon the amount will be disbursed
According to Ujjivan Small Finance bank, “You can get your loan disbursed inside an hour! This is, however, subject to the verification of the gold, your application form and supporting documents.”
Repayment of gold loan
You can repay your loan through a single Bullet Repayment covering both the principal and interest at the end of the loan tenure. You can also make part payments during the tenure of the loan.
Minimum and maximum gold loan
At Axis Bank, you can get Rs 25,0001 to Rs 25 lakh. In SBI, the gold loan minimum Rs. 20,000 to maximum Rs. 50 lakhs. PNB offers a minimum amount is Rs 25000 and maximum of Rs 25 lakh. Canara Bank offers minimum amount of Rs. 5,000 and maximum amount is Rs 35 Lakh.
What documents are required to apply for a Gold Loan?
The list of documents required if you wish to apply for a Loan against Gold with HDFC Bank are:
- One Passport Size Photograph
- PAN (Permanent Account Number) Card (together with any of the below
- mentioned documents) or Form 60
- Passport (Not expired)
- Driving license (Not expired)
- Voters’ ID Card
- Aadhaar Card issued by UIDAI
- Agri Allied Occupation Documentation( in case of bullet repayment for agriculture customers)
What happens if a Gold Loan is not paid?
According to the HDFC Bank website, “In the situation of a Gold Loan non-repayment , the bank begins with sending reminders via email and texts to intimate the borrower regarding EMI payment. After a stipulated period certain penal charges or interest rates are levied on the Gold Loan amount. Eventually, if the Gold Loan amount is not paid after repetitive follow-ups over the due course stipulated by the bank, the bank will proceed to sell or auction the gold ornaments and repay the loan amount”.
