North India Statesman
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If you are also struggling with the problem of money and you have kept gold, then this news is of your use. The Reserve Bank of India (RBI) has implemented some new rules related to the gold loan, which has now become even easier and beneficial to take a loan by pledging gold. Under these new rules, now you will be able to take more loans than ever before by mortgaging your gold, especially from private companies that work in this field.
Now we will get a loan of up to 90% of the price of gold!
One of the most important changes associated with gold loan is an increase in ‘Lone-to-Value’ (LTV) ratio. While earlier banks or financial institutions used to give maximum loan of 75% of the total value of gold, now you can get a loan of up to 90%. This rule is a great relief for those who require more money for their immediate financial needs. This move of RBI was taken with the aim of increasing liquidity during epidemic and providing funds to people easily, which is still being benefited by many customers.
For whom are these new rules?
This facility has been mainly implemented to private companies working in the banking sector or for non-banking financial companies (NBFCs) that give large-scale gold loans, such as Muthoot Finance or Manappuram Finance. These companies have started giving loans for their customers under this new rule.
Why is the gold loan better option?
Debt (gold loan) in lieu of gold is a very fast and easy way to meet financial needs. It has many advantages:
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Fast distribution: Gold loans are found much faster than personal loan or other safe loans. In a few hours, the amount of loan can come in your account.
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Low interest rates: Usually gold loan interest rates are lower than a personal loan, as it is a safe loan where your gold is in the form of bail.
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Minimum document: It requires very little paper, which makes the process even easier.
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Flexible repayment options: You get many options like monthly installment, interest with interest or without interest as per your convenience.
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No credit score needed: If your credit score is not good, then you can still get a gold loan, because it protects your gold.
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Gold is safe: As long as you repay the loan, your gold is safe with the bank or financial institution.
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Jewelry Uses: You can get cash using your jewelery, without selling them.
How to get a gold loan?
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Evaluation: The first is evaluated on the basis of purity and weight of your gold.
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Loan amount: After the evaluation, you are fixed the loan amount according to the current gold rate and RBI guidelines (now 90% LTV).
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Reportation: You are given a certain time-limit to repay the loan. The lender can take legal action for not repaying the loan on time, including your gold auction.
In short, RBI’s new gold loan rules can prove to be a major relief for those who require emergency financial assistance. This is a golden opportunity to convert your inactive gold into cash, that too in large amount than before.
