If you think that the only purpose of gold ornaments and pieces of jewelry is just to be used to look good and elegant! Because they are an important asset that can aid you during your financially difficult times. Anyone can easily get gold loan by pledging the gold ornaments as collateral if some unforeseen emergencies occur by chance. Due to gold items’ secured nature, banks tend to provide with minimal interest rates on Gold Loan. It can also offer an additional credit mix to your overall profile. Main reason that it is so popular is that the gold loan repayment procedure is considered super flexible and available to almost anyone holding gold assets idly resting at their homes!
Depending on the various conditions of the loan-taker and the nature of its lender, the repayment procedure changes accordingly. So, if you require money immediately and decide to take a gold loan, check all the repayment methods available to land on the most suitable one for yourself to avoid any future problems while repaying it.
Various Repayment Process of Gold Loans –
The repayment of the loan and its interest are crucial factors or concerns in any loan facility. Due to the various repayment methods, it became easy for us to pay off the amount and interest. In case of the gold loan, the lender provide you with four key repayment methods, which are as follows .
Regular Monthly Payment of Interest and Principle
Almost any loan, such as personal, car, and home loans, is repaid using this traditional method. This EMI base repayment option is best suited for a salaried person with a fixed monthly income.
In this mode, you have to repay a fixed monthly amount which includes a portion of your interest and a portion of the principal amount, and you have to pay this equated amount in monthly installments during your tenure. To avoid the hassle, the loan lenders can use the gold loan online payment method to deduct this amount of EMI every month from your bank account. Since the applicants with fixed income inflow generally opt for this loan, it can be approved very easily.
A gold loan interest calculator
It can be used to decide on a fixed amount of interest and EMI that you pay every month depending on the monthly salary you earn. It is an easy and understandable way that saves you from the confusing calculations in this matter and needs a little information like the exact amount of outstanding loan, tenure duration, and interest rate.
Repayment of Intrest at Intervals and Principal at the End
In this gold loan repayment procedure, you can repay only the interest amount due on loan at regular intervals that best fit your financial situation, such as monthly, quarterly, semi-yearly, yearly, etc. The principle amount has to pay off as a single payment at the end of the tenure. People often opt for this as they make small interest payments at their preferable intervals without worrying about the principle. It is always advisable to keep one’s repayment capacity in mind as they pay the huge amount of the principle.
Partial Payment in an Upfront Way
This type of repayment method is similar to previous process where you can choose any intervals to pay the interest. The difference is instead of deciding on break, you can make payment of both at any preferable time you desire. In this way, you don’t need to abide by the timeouts of intervals provided by the schemes of the lender. You can either pay out the total principal amount upfront at the beginning of the tenure. It will help reduce the amount of interest payout that is calculated daily on the outstanding loan amount.
You can pay the amount interest at the beginning and only wait to pay off the principle at the end. You don’t have to worry about any payment during your tenure and complete the principal loan payment at the end. But there’s a drawback, if you somehow fail to finish off the principal loan, your gold will not be released. So always make divisions keeping your financial capability in check.
Repayment Using Bullet Method
You are using this one of the most flexible payment methods; you can pay off your principal loan amount and the whole interest amount not – at the end when your tenure is complete. During the term of the gold loan, there’s no need for you to worry about any payment plans or adhere to any EMI schedule, pay the entire amount when the loan term ends. Keep in mind that the interest is being calculated every month to be added to the principal amount at last. The bullet Repayment method is called because you finish repaying your loan in a single shot.
In general, the maximum tenure if holding loans is five years. You can take a loan by pledging your gold and then repay that using any of the aforementioned methods. As the majority of gold loan lenders and banks offer you to use most of these gold loan repayment procedures and the gold loan online payment method, you can safely and easily pledge your gold in times of emergencies and repay it smoothly.