A gold loan is a secured loan that can be availed by almost anyone by pledging their jewellery as collateral. The non-stringent eligibility criteria is the USP of the loan which makes it a viable option for many borrowers. The rate of interest charged by the gold loan companies is comparatively less than any other unsecured personal loan credit facility.
Gold is a prerequisite of every Indian household that is often readily pledged as collateral as compared to other assets. The lower cost of borrowing, minimum documentation, hassle-free disbursement and more make Gold loan an easy-to-get option. However, the repayment of the loan can be a tedious task due to several financial obligations. Let’s discuss how we can simplify the repayment of a gold loan.
Here are 4 easy ways to manage the repayment of a gold loan adroitly:
1.Do not borrow more than you require
It’s extremely important to apply for the exact loan amount that you need rather than applying for an amount that is more. Over borrowing often gets overwhelming making repayment burdensome. Huge loan amounts often translate to high interest.
Therefore, every applicant must be certain of the estimate of the required amount in order to avoid paying higher interest charges. Even if you are eligible to avail a high amount, you must stick to your requirement.
2.Opt for monthly payments
Once the amount is decided, an applicant is required to select a lender that offers high gold value at affordable interest rates. After finalising the lender, ensure to make the repayment of the loan a monthly affair. Select a particular date for the repayment, however, don’t forget to consider all your expenses before finalising on a specific day.
By setting a date of repayment, you get more organised with your expenses and can make a gold loan quick payment without any hassle.
3.Make part payments
Part payments are one of the easiest ways to get substantial savings on gold loans. Often zero charges are levied by a majority of lenders. The customers who have taken a gold loan can make partial payments by utilising funds such as freelancing projects, returns generated from investing or savings, etc. Part payments make repayment convenient as it generally results in reducing the principal amount.
To save on interest, foreclosure of gold loans is yet another option. However, you must know that financial institutions often tend to impose foreclosure charges. Therefore, it’s imperative to look for a lender that levies minimal foreclosure or pre-payment charges.
4.Select bullet repayment
In a bullet repayment plan, an individual is required to pay the principal amount as well as the interest at the end of the tenure. There is no particular EMI schedule to be followed. Since the repayment is done by the borrowers at one go by the end of the loan period, it is therefore known as bullet repayment.
Repayment is a responsibility that one must make certain to fulfil through smart payment techniques. Opt for the best loan company in India – IFL that offers the finest gold loan facility which helps you get the best value for gold at minimal interest rate.