Last Updated on April 16, 2023 by Tabraiz
There is no denying the significance of gold as a financial asset. Even while sentimental reasons are the main reason people buy gold jewellery, such items can provide security when facing tough financial times. A gold loan is accessible to almost everyone. You must use your jewellery as security to obtain a gold loan. These loans have lower interest rates than personal loans because they are secured loans. After taking out a gold loan, you have several options for repaying the principal and interest, including gold loan online payment. Here are a few of the more practical choices –
Pay interest as EMI & principal later
You are allowed to return the interest owed on the gold loan through this method of repayment by the EMI schedule provided by the lender. The principal amount can be paid off with one payment, though. The loan’s maturity date may be used to make this payment. Because they may only pay back the interest during the gold loan repayment period and don’t have to worry about the principal, borrowers prefer this method of repayment.
Make partial payments
You are not forced to follow the lender’s EMI schedule if you choose this method of gold loan online payment. The main amount, as well as the interest, can both be paid in instalments as needed. As a result, you can adjust your payback timeline to fit your budget. Your total interest payment, which is based on the amount of the loan that is still outstanding and is calculated daily, will be lower if you decide to pay the principal in full at the beginning. As a result, you save a lot on serviceable interest.
A bullet repayment plan requires you to pay out the entire loan balance at once, including the principal and interest. Throughout the loan term, you don’t have to worry about paying back the gold loan at all. You can pay the full amount when the loan period is through without having to follow any EMI schedule. The loan’s interest is calculated monthly but is only due after the gold loan period is up. This method of paying back a gold loan is known as a bullet repayment plan since you do it all at once.
Regular EMI option
A regular EMI-based repayment schedule for gold loans is designed with salaried individuals with a fixed monthly income in mind. Both interest and principal repayment are included in the total amount of the EMI. The loan is granted sooner because it benefits salaried individuals.
In general, Gold Loans feature quick repayment terms and no lock-in periods. The maximum term for a gold loan is five years. The loan account will be cancelled once you have paid off the remaining loan balance and any accrued interest, such as through a gold loan online payment, at the end of your duration. A gold interest calculator is used to determine the interest. The lender will give back the gold items given as collateral if the loan is satisfactorily repaid. Jewels will be sold at auction if anyone fails to repay the debt.