A gold loan is comparable to a mortgage loan, while the borrower keeps their gold as security with a lender and receives funding. You must meet the gold loan eligibility criteria for this credit line. A gold loan has a lower interest rate in contrast to other loan types.
Gold loan interest rates now range from 9.50% to 28% depending on the lender. However, this could fluctuate based on the nation's monetary policies. Top-ranking lenders charge the lowest interest rates to customers who pass the gold loan eligibility criteria.
Who is eligible for a gold loan?
The gold loan eligibility requirements depend on the lenders. Everyone who owns gold jewellery is qualified to apply. Some lenders also accept gold coins. The candidate must fall between the ages of 21 and 70. Professionals, self-employed people, business owners, and other people can get loans against gold.
Furthermore, a low credit score usually isn't an issue for the gold loan eligibility criteria because this is a secured loan.
How are gold loans paid back?
Pay periodic EMI- This comprises the monthly payment of the principal amount as well as the interest.
Pay EMI first and principal later- To refund the interest and pay the entire principal amount at maturity, adhere to the EMI plan.
Partial payments- Pay interest and principal payments in full or in part, regardless of the EMI schedule.
Bullet repayment- At the conclusion of the loan's term, pay back the principal plus interest.
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