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What is Gold Loan?
The most significant aspect of gold resources is the value that keeps increasing every day. Hence, people buy gold as a form of investment that will provide them financial stability with its increasing value. The purpose of loans against gold is to bring out the value of the metal in times of financial shortage.
Now, when you apply for a gold loan, you agree to pledge gold products as a form of collateral for the money to be borrowed. You are expected to pay the interest and repay the principal amount like any other loan scheme. If failed to repay the funds, the gold resources will be repossessed by the bank or NBFC.
Opting for a gold loan is one of the safest options for borrowing money. In addition, there are numerous benefits of taking such a form of a loan. So, let us look at some of its advantages.
- Fast processing speed
- Availability of easy interest-only options
- Minimum interest
- Less processing fee
- High security
- No eligibility based on income
- No credit history verification
- No prepayment charge