Nowadays, we are here to give you a slight bit of additional information, thinking it might add some more knowledge regarding the gold loans. Let’s see, and learn some more about gold loans! To start off with, gold loan is something in which an individual offers his or her gold assets to the lending institutions which are banks, non banking financial companies, or private lenders in need of loan, to stabilize his or her financial needs or his or her own personal aspects in life. Whereas we all know the simplicity and not much of a complicated procedure being involved in this whole process and therefore gold loans especially have been more in demand and eventually the growth of the economy is also increasing at the same time due to the high demand of gold prices in the market.
When we mentioned the simplicity and not complications, it includes the quicker and short span of processing time, general and basic proofs to be submitted and in which they do not require or make an individual to include his or her income proofs along with the others. The added advantage compared to other loans comes into picture, when we talk about the interest rates taken into consideration that is, gold loans are being offered to the borrowers and customers at very low interest rates, and the newly being talked about long term gold loans are doing rounds with the added benefits of customers and borrowers being able to enjoy the low interest rates alongside with the longer time duration of the tenure periods they are offering them with.
Now, when we talk about all the above factors concerning the rates of interest and time duration, gold loan interest rate varies among different types of lending institutions which comprises both the banks and non banking financial companies and let’s take a look at the variations among these.
HDFC Sampoorna Gold loan - The interest rate being the main criteria here, starts at 10% onwards, which is considered to be moderate for the customers. The loan amount offered on a minimum and maximum basis is from ₹ 50,000 especially in urban places and they made it less than ₹ 50,000 for the sake of rural areas. But one thing which is kind of a disappointment to the borrower is the processing fee, which includes things like valuation charge, stamp duty and other applicable charges.
Muthoot Finance Gold loan - This is one the most talked about and the top lending institution which comes under the category of NBFCs which is known to be Non banking financial companies. These generally have higher interest rates and this in particular offers at 11% onwards. And the processing fee is up to ₹ 500. And the loan amount this one offers is a minimum of ₹ 1,500 and maximum of ₹ 1 crore.
Axis Bank Gold loan - This is again another most invested and talked about banks and is known for itself advancements over the years. The interest rates are slightly high, which starts at a percentage of 14.5% onward. And the fee includes both the processing fee as well as valuation charge which is at ₹ 500 and the processing fee is 1% to be included. It points a note to new customers with a limit in the loan amount of ₹ 4lakhs. And for the old or regular customers the minimum and maximum amount is from ₹ 25001 to ₹ 20Lakhs.
The gold loans prepayment penalty is just nil or might be upto 1% when in comparison to certain other loans, like some loans against property, the prepayment penalty is upto 2%, which might be the added benefit for the customers and borrowers.
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