You’ve just seen an apartment you would really like to book, but don’t have enough cash for the down payment. Where would you raise the cash? If you’re thinking personal loan, do consider a loan against your jewellery first.
Loans against jewellery, which several finance companies and banks offer today, allow you to make use of the gold and jewellery you have safely tucked away in your home or in a bank locker. If you’re in a bind, taking out a loan against jewellery may prove to be the quickest route to raising cash.
These loans come with processing time of less than a day, virtually no documentation and flexible payment options. You don’t even have to state the purpose for which the loan is required.
How to get it
The mechanics of a jewellery loan are simple enough. You pledge your jewellery with the bank, which then sanctions loans based on the value of your jewellery. When you repay the loan, you reclaim your jewellery. Application and sanction of the loan can be completed in a single day, allowing immediate access to the cash.
Not all banks offer loans against gold. But among those who do are Indian Bank, Axis Bank, Canara Bank, HDFC Bank and Syndicate Bank. Financial companies such as Manappuram Finance and Muthoot Finance specialise in such loans.
Gold loans are typically much cheaper than personal loans or loans you may take on your credit card.
Interest rates range from 12 to 15 per cent per year. Rates vary slightly between banks; for instance, Indian Bank charges a 13.25 per cent interest rate while Axis Bank charges less than 12 per cent. Muthoot Finance has rates from 1 per cent a month, while it is 0.96 per cent a month at Manappuram Finance.
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