Gold Loan Vs Personal Loan: Know the Benefits
If you are preparing to take a loan for any need, then it is not necessary that you try for a personal loan only.
Taking a gold loan can prove to be more beneficial for you than a personal loan. Many times, an emergency comes up in life such that we have to think about the option of taking out a loan.
In such times, gold kept at home can easily get you a loan. There are many non-banking financial companies in the country that offer gold loan facilities.
With companies like Manappuram Finance, Muthoot Finance, and IIFL, you can get an instant loan against a gold pledge.
Almost all governments and private banks also provide gold loan facilities. Let us tell you why a gold loan can be a better option.
Interest Rate is Low
The rate of interest is higher in other loan mediums. If we talk about personal loans, then the rate of interest on personal loans is very high.
Generally, the interest rate on the loan ranges from 12.7 percent to 19 percent. But compared to this, gold can be found at a lower rate of 12%.
The low rate of interest makes a gold loan very attractive, and the time taken to avail a gold loan is also less.
It may take 48 to 72 hours for the personal loan to be approved and disbursed. while the gold loan is available within a few hours.
No Credit Score is Required
No credit history is required to avail a gold loan. Suppose if you apply for a personal loan, you must have a good credit record; otherwise, the bank may refuse to give you the loan.
But this does not happen in the case of a gold loan. Also, the processing fee in the process of taking a gold loan is very low.
At the same time, most banks charge a processing fee of up to 2.5 percent for personal transactions.
Income Certificates Are Not Required
There is no income requirement for a gold loan.
You do not need to show proof of income at the time of loan, whereas applicants for an auto loan, a home loan, or a personal loan must all show proof of income.
Apart from this, you keep paying interest every month on the gold loan. In a gold loan, your gold is also safe, and the interest rate is low.
