How Gold Loan is better than other Loans?
Every bread winner understands the importance of savings. Savings are essential to meet the needs during a rainy day. They are important for fulfilling long awaited aspirations or dreams. At times, however, the saved amount may not be adequate to meet the needs. During such times, you may look out for a financing option like a loan.
Several banks and NBFCs provide personal loans to needy individuals. However, borrowing and repayment of personal loans can be a daunting task. Furthermore, the lack of collateral makes these loans insecure. Hence, banks follow strict credit checks before granting these loans.
To simplify the borrowing process and to help the needy in troubled times, many banks and NBFCs like Magma have launched easy gold loans. Gold has always been looked upon as an investment option by Indians for centuries. In age-old days, money lenders would grant small loans in return of gold ornaments. The same concept has been standardized by banks and NBFCs as gold loans.
There are various advantages of borrowing gold loans over personal ones. The following advantages indicate why gold loans are better than any other type of loans.
- Quick sanctioning: Gold loans are secured loans wherein the gold belongings are kept as collateral.Hence, they are sanctioned quickly within few minutes.
- No Credit Check: Banks and NBFCs do not conduct strict credit history checks while sanctioning gold loans.
- No extensive documentation: Financing against gold requires only personal identification proof. No additional documents like income proof, address proof, bank account statement, etc. are required.
- Zero processing fees and no upper limit: Unlike personal loans, financing against gold does not carry any processing fees. Moreover, there is no upper limit for the loan t as valuation of gold determines the principal.
- Flexible interest rates and zero foreclosure charges: Interest rates are much lower than personal loans and you are also given an option of pre-payment without any foreclosure charges.