Gold loan is a traditional way of lending-borrowing gold ornaments which has transcended into modern technology. This form of loan is being provided by all banks and NBFCs. Gold Ornaments are not only a piece of jewelry, but it is also a back up to rescue in times of financial crisis. As one needs to pledge only its gold ornaments with a lender.
As compared to other loan applications, the application of gold loan is quickly processed and requires minimal documentation. If you are in dire need of cash, then consider taking a gold loan as its interest rate is also minimal and it is easy to repay.
Under this Gold loan repayment method, lenders allowed you to pay only the interest amount according to the EMI schedule and the whole principal amount to be paid in full at the time of maturity. This facility works great for most of the borrowers, as for the whole loan tenure, they need to pay only the interest amount and not principal amount. It is the best way to reduce your EMIs.
Lender follows the customer-centric approach in case of gold loan repayment. It is not mandated to follow the EMI schedule in case of gold loans, the borrower is liable to make partial payments of both interest and principal amount as per the convenience and affordability. Not only partial, but the lender also accepts even full payment of both interest and principal components irrespective of the pre-set EMI schedule for the loan repayment. If you make repayment of the principal amount initially, then the total interest payout is calculated based on the outstanding loan amount. Overall, following this method of pre-payment, one can save a lot of serviceable interest.
In this, one must repay the entire principal and interest amount during the end of the loan term. There is no need to pay the principal or interest amount during the loan tenure. There will be no EMIs to be paid in this case, only the interest is calculated each month, but interest and principal amount repayment are to be paid when the loan matures.
This option of prepayment suits most to the salaried class, as paying regular EMIs. The salaried class cash is added to their bank account every month. Here the EMI amount includes both interest and principal amount pay-outs.
It is wise to repay gold loans as desired as it has no prepayment penalty. The gold loan tenure of IndiaLends is fixed i.e. 06 months and it can be renewed again after 06 months for another 6 months with zero renewal charges.
So whenever you approach your lender, to close your gold loan account, you need to deposit first, the full principal amount. After your all gold loan amount dues are being paid off, then the lender considers your loan account stand closed.
After getting the confirmation of the closure of the loan account, the concerned authority (lender) will hand back the collateral gold to you and ask for the acknowledgement. And so it will be the end of it. The gold jewelry used at the time of financial urgency will again be at your service, shining with eternal glow and mesmerizing beauty to embrace your ownership.