The Negligible Amount Is Charged As Processing Fees In A Gold Loan

A gold loan is a secured loan where gold jewellery or ornaments are deposited as collateral or security by the bank or lender. The gold loan is given to the applicant against gold jewellery and ornaments as security or collateral. Moreover, gold loans do not even include a high processing fee to be charged.

If you wish to avail of a Gold Loan, then there are some points that everyone should know regarding Gold Loan as given below :-

Tenure of Gold Loan :- The tenure of the gold loan is quite flexible and varies from different banks and lenders. Yep, the tenure period is when you are supposed to return the principal amount of the loan along with monthly instalments. So, the longer your tenure for repayment, the higher your interest rate on the gold loan. Whereas, if you have good relations with your bank or lender, you might get a reasonable tenure for your gold loan.

Minimum eligibility criteria :- Under gold loans, eligibility criteria are essential in quite a limited region; for instance, an age which should lie between 18 years to 70 years, plus the profession of the borrower is also a crucial criterion for the sanctioning of a gold loan. A credit score is not that significant for applying for a gold loan because it is a loan with a loan sanctioned against collateral or security. However, borrowers opt for gold loans when they want to improve their bad credit scores.

Processing fees :- These are the charges reimbursed by the applicant to the lenders or banks for the period between the compliance of the loan application and the period when the bank or lender approves of the application which was submitted to the bank or lender for the evaluation process; these are the charges that lenders and banks take for checking the application form and verifying the documents along with it. Now, these charges change from different banks and lenders. Such as, some banks and lenders might not charge a processing fee, whereas others might charge as low as 1%-2% on the other hand, others might take it in the form of a particular percentage on the whole amount of the gold loan or ₹ ten onwards. It depends on the bank or lender. Therefore, negligible processing fees are charged by banks and lenders on gold loans, which makes the borrower’s process relatively easy and reasonable.

Repayment tenure :- Every loan has a repayment tenure that is an end date of the gold loan period. Within that term, the borrower is accountable for paying back the principal amount along with the monthly instalments he is liable to. However, gold loans are short term loans, they can be paid back within a short period, such as a minimum of three months. And one can verify their monthly instalments through the Gold Loan Calculator. This is available on every bank’s online website, which means you do not have to visit the bank branch.

One can check the monthly instalment just by using your device; almost every bank provides this facility. such as the SBI Gold Loan Calculator. In this way, you can check the suitability of your pocket and accordingly plan on paying back the monthly instalments and the principal amount within the stipulated time.

These are some of the easy ways in which you can apply for a gold loan along with submitting a few documents that the banks and lenders ask from you such as identity proof: PAN card, Aadhaar card, passport etc. address proof like Aadhaar card, passport, Voter-ID card, electricity bills, water bills, telephone bills etc. and some additional documents like passport size photographs etc.

Questions To Ask Before Applying For Personal Loan

A personal loan is no doubt the best loan option available in the market. But there are a number of doubts in our minds that are often left unanswered. There's no one to guide because a lot of banks don't have customer service facilities. And we often proceed to apply for this loan option without getting clear answers.

But it's very important to understand all the factors that are associated with a personal loan and how they will impact other factors (like credit score) that can affect our future loans. So here we'll answer some frequent questions asked by customers below:-

How can I use the funds I've borrowed from a personal loan?

The funds you've borrowed from a personal loan can be used for multiple purposes like:-

1. Wedding: Weddings are a momentous event in India. And there are multiple expenses incurred during this event. So to cover all the expenses you can easily get funds by applying for a personal loan facility.
   

2. Holidays: We all deserve a vacation. And if you're planning to go on a vacation then you don't have to think about using up your savings. You can easily get funds by applying for a personal loan facility at any bank or financial institution.
   

3. House Renovation: We all need a change in scenery. So if you're planning to remodel, restructure, redesign or renovate your house. Then you can use the funds you've borrowed from a personal loan.
   

4. Medical Bills: If you want to cover all your hospital bills. Then you don't have to go too far, you can easily apply for a personal loan facility at the comfort of your home and get funds immediately disbursed after the verification process is done.
   

5. Debt Consolidation: It's crucial to repay all your debt, credit and loans on time. Credit bureaus keep complete track of your repayment history. So if you're currently struggling to repay your loan amount then you can apply for a personal loan facility and use the funds you get through this loan for debt consolidation.

You can calculate your repayment structure using some online tools like an EMI Calculator for Personal Loan.

How do I qualify for a personal loan facility?

Banks are very strict with their personal loan eligibility criteria. You have to meet certain criteria to be eligible for this loan. Although the eligibility criteria differ from one bank to another. But there are some factors that remain common for every bank.

The basic eligibility criteria are:-

• Age: The minimum age required by the bank is 21 and the maximum age is 75.

• Employment Status: Both Self-employed individuals and salaried individuals can apply for a personal loan facility.

• Work Experience: A work experience of a minimum of one year in your profession is required.

• Income: The minimum income required is INR 10,000.

• Credit Score: 750 and above.

Would a personal loan affect my credit score?

Yes, your personal loan has a direct impact on your credit score and vice versa. A lot of banks use credit scores as their primary eligibility criteria. So you can only get your application approved if you have a high/excellent credit score. A low credit score can either lead to rejection of your application or you'll be charged with a high SBI Personal Loan interest rate for your salary account. So it's important to maintain a decent credit score to get your application approved.

You can also use this loan as an opportunity to increase your credit score. You'll just have to repay the loan instalments on time and you'll notice a change in your credit score after a certain time.

What documents are required for a personal loan?

The entire documentation process of a personal loan is very quick and effortless.

The basic KYC documents you have to submit are -

• Identity proof: Aadhar Card, Pan Card, Passport, Driving License, Voter ID Card, etc.

• Address proof: Water Bill, Telephone Bill, Electricity Bill, Gas Bill, other Utility Bill, etc.

• Income proof: Payslip, Bank Statement, Form 16.

• Employment proof: Offer Letter, Approval Letter.

How To Obtain The Cheapest Offer In Personal Loan?

Personal loans are comparatively easy to apply for and get approval for compared to home or land loans. That makes them useful for every purpose, from planning a vacation to purchasing expensive technology. You can use this money for any purpose, but it is always wise to borrow only the amount you need or things that enhance your finances or significantly impact your living style. Various factors need to be considered when you think of getting the cheapest offer in a personal loan.

Here are some of the factors to be considered before taking a Personal Loan as below :-

Loan Tenure :- The tenure for a Personal Loan can range from one 1year to 5 years. But the shorter the tenure of a Personal Loan, the better it would be. A higher tenure can reduce your monthly instalments, as the interest rate is lower in such cases, whereas opting for a lower tenure such as 2 to 3 years tenure can increase your EMIs you will have to pay a higher interest cost on the Personal Loan.

Personal Loan Interest Rate :- When you avail of a Personal Loan, the interest rate is one of the major deciding factors. The interest rate you pay depends on a variety of other factors such as your age, income stability, employment status as to whether you are salaried or self-employed, number of years of work experience (in the current job/business/profession), your credit score, existing instalment amounts if any, and your repayment capacity, loan tenure, and some other factors. The interest rate determines your monthly EMI. So, make sure you apply for the best personal loan rates after checking several options. You can also go through the Personal Loan Interest Rate In SBI to get a better know-how about these terms and conditions.

Processing Fee and Other Charges :- Taking a Personal Loan does not only involve deciding about the interest rates; there are other charges as well, such as processing fees and other charges levied by banks and lenders. The processing fee is a one-time charge which is a certain per cent of the total Personal Loan amount. It varies from different banks and lenders. A higher processing fee impacts your total loan amount substantially while you apply for a Personal Loan.

Repayment Flexibility :- Apart from the above essential aspects, check if the bank or lender provides you with the flexibility to repay the loan amount sooner. What extra charges will you incur by doing that? This flexibility can help you prepay the loan amount before your tenure end and provide relief in stressful times. Therefore, it is best to follow the financial discipline rules and repay the Personal Loan within the stipulated time and maintain the financial health in the pink.

Terms & Conditions :- Make sure you go through the terms & conditions carefully to make an informed choice, and if you present everything correctly, you might get an Online Instant Personal Loan. This will avoid issues in the future and make sure that you have a hassle-free experience.

Personal loans can be beneficial for fulfilling the needs for funds, given the appropriate circumstances. They can be pretty easy for you to avail and use to fulfil your monetary needs. For example, many people can’t afford to make big purchases, so getting a personal loan becomes a critical thing. However, it’s also necessary to understand exactly what you agree to when you avail of a personal loan. And you need to have a solid plan for repaying the loan according to your agreement with the bank or lender. Therefore, be sure to consult your plan with a trustworthy financial institution, get their assistance, and weigh your options so that you conclude that benefits you to fulfil your needs for funds. This can make your loan process much more accessible and convenient.