How Does Gold Loan Work? Complete Procedure!

Since time immemorial, gold has been the mark of pride and safety. 

New brides are given gold as it is auspicious and makes them feel financially secure in their new journey.

Even governments keep gold reserves and the Reserve Bank of India bought a massive 77.5 metric tonnes of gold in the financial year 2021. 

The gold prices are ever-increasing and people buy gold to make a profit out of the climbing prices.

A lot of people use their gold to get smart funds in the form of a loan against gold

Gold Loans

A gold loan is a secured loan that an individual can take by keeping his gold as a security with the lender. This gold acts as collateral for the loan and gives the lender the right to sell off the gold if the borrower defaults on loan repayment. In return, the interest rate on a loan against gold is much lesser than on other loans since it is a secured loan. Muthoot FinCorp offers gold loans starting at only 11.99% per annum on various gold loan schemes. 

Working of a Gold Loan

The gold loan process is very convenient and does not burden the applicant with additional stress in his difficult times. The process to get a loan against gold is simple and quick. 

An individual can get a gold loan within minutes with lenders like Muthoot FinCorp, who ask for minimum documentation and paperwork to sanction a loan against gold

Muthoot FinCorp offers as high as 75% of the pledged gold’s value as a loan. 

The borrowers get the flexibility of paying back the loan and interest amount in customised EMIs or as bullet payments as per their convenience. 

Process of Getting a Loan Against Gold

The process of applying for a gold loan involves minimal steps and can be completed quickly. Here’s the process:

  • Visit the website or download the mobile application of the lender and fill out the basic details of the loan applicant and the required information of the gold to be pledged. 
  • Use the gold loan calculator given on the lender’s website and calculate your loan eligibility. The loan eligibility will depend on the weight and purity of the gold pledged as collateral, following its market price. 
  • The loan applicant can also use the calculator to calculate the amount of money he needs to give as monthly instalments under various gold loan schemes for different tenures. 
  • Once the borrower has decided on the repayment mode and the gold loan scheme he wants, he can click on submit.
  • An executive will get in touch with the applicant and explain the further process. 
  • The applicant can visit the nearest branch of the lender and submit the required documents and then give the gold for evaluation. 
  • Once the evaluation process is complete the loan against gold is processed within minutes. 

Documents required for a Gold Loan

Unlike other loans, borrowers need to submit only a few documents while applying for a gold loan. These documents are:

  • Identity Proof (Passport/ PAN card/ Driving Licence/ Voter’s ID/ Aadhar card)
  • Address Proof (Aadhar card/ Rent agreement/ Bank statements/ Utility bills/ Voter’s ID)

Features that make Muthoot FinCorp Gold Loan Process Fast

Muthoot FinCorp offers gold loans under various schemes to customers. These schemes start at a reasonable interest rate of 11.99% per annum and offer various repayment options to the borrower. You can avail of gold loans within minutes with Muthoot FinCorp. With Muthoot FinCorp gold loans, a customer can:

  • Enjoy cashback offers on regular repayment of the loan and interest amount.
  • Payback through easy EMIs options and bullet payment schemes as per their convenience. 
  • Submit only minimum documents to get a loan against gold.
  • Get a gold loan at minimum processing fees starting at only Rs. 20 including GST.
  • Get a top-up of up to Rs. 5 lakhs within a single day for zero processing fees under the 24*7 Express Gold Loan scheme. This facility can be availed for the first five disbursals. 

The borrowers can rest assured of the safety of the gold they pledge. Muthoot FinCorp keeps the pledged gold in secured vaults under strict and continuous surveillance. Once you pay back the loan and interest amount, you can take back your gold valuables easily.

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