Gold prices are touching record highs. India has one of the largest markets for gold. Many customers who have their golds in vaults are considering going in for gold loans to meet their requirements. Getting a gold loan is a easy and hassle-free process. Gold loans are processed faster compared to other loans, it also has a lower rate of Interest when compared to personal loans. One of the Banks providing gold loans is City Union bank.
Features of Gold loan:-
Minimum loan amount starts at Rs. 5000/-
Maximum loan you can get from City Union bank is 5 Lakhs.
Gold loan tenure upto 12 months.
Gold loan Interest rate for a gold loan is MCLR +4.75.This rate can vary depending on the quality and quantity of the yellow metal pledged.
Gold loan per gram is between Rs. 1755 - 2145 and is subjected to change based on market rates and purity of gold. This makes all the difference in the requirements and the cost to get this credit facility.
The banks and non-banking financial companies provides gold loan with minimal documentation, they also have a secure storage facility for your precious yellow metal.
Essentials:-
The lending institution (banks and non-banking financial companies), in this case, City Union bank gold loan verifies the gold ownership and identity documents these documents are also known as LTV or Loan To Value. A credit limit similar to a bank overdraft account is given, the limit is 75% of the market value of the gold. The LTV (loan to value) is capped by the RBI, this particular amount can be withdrawn by the customer when they please.
On repayment of the loan the customer can repledge the same gold for future needs (loans). Customers, the borrowing individual or entity, can also choose to make bullet installments instead of EMI’s (equated monthly instalments) which in other words a lump sum payment made for the entire outstanding amount, this is usually done at maturity of the gold loan. There is no limit as to how many times the customer can pledge the gold. Some banks allow partial payments and early repayments without any penalties. You can also call this an overdraft facility offered to customers whenever needed.
Conclusion:-
A gold loan or a loan against gold is given in place of the gold so if your gold is authentic, you don’t need anything else such as a good credit score or a salary slip, you can easily avail the loan without any hassle. The requirements are simple and basic but essential. This credit facility is one of the most convenient facilities that an individual or entity can get from the credit market.
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