In today’s times, taking a loan is easy. With the number of lenders and loan options available in the market, all you have to do is identify the right fit for you, sign on a dotted line, and have the money credited to your account.
Although availing a loan might be relatively straightforward, the repayment method may be confusing. Understanding the interest section of EMI payments, pre-closure charges, cost details and other small specifics can often get a bit intimidating. When compared to other loans in the market, gold loan repayment procedures are much simpler. Moreover, they provide you with multiple ways in which you can make payments, offer convenient ways of repayment, and gold loan repayment periods are also diverse, allowing you to choose one that is the best fit for you.
Gold Loan Repayment Methods
Gold loans are short-term secured loans, that is, they are sanctioned on the basis of physical gold assets that act as collateral. Due to this underlying security, applying for a gold loan can often carry lower interest rates when compared to its alternatives like personal loans or credit cards. Repayment methods are also flexible; lenders usually offer borrowers four different gold loan repayment options:
Equated Monthly Instalments
Under an EMI gold loan repayment option, you can repay the borrowed principal amount plus interest in equal instalments over a period of time. The tenure or duration of the loan can be decided at the time of borrowing. For those borrowers who would like more time and would prefer to make smaller payments, a longer gold loan repayment period can be chosen. Usually, most institutions have flexible repayment schemes that offer periods between 6 to 36 12 months.
With monthly gold loan repayment options, the amount that needs to be repaid only includes the interest accrued every month. This differs from EMI payments as no portion of the principal amount needs to be paid. Instead, the interest payments are calculated on the basis of the remainder of the principal amount and the outstanding balance. This cycle goes on until the loan matures.
Bullet Payment Gold Loan
If you cannot keep up with regular EMI payments due to any reason, be it infrequent income or just the hassle of scheduling the payments, then you can choose a bullet repayment gold loan. Bullet repayments allow you to repay both the borrowed amount and interest at the end of the loan period. This means that if your gold loan repayment period is 12 months, you can pay the entire sum at maturity. Although interest will be calculated on a monthly basis, it will become due only at the end of the loan period you have chosen.
In case you feel that neither regular EMI schedules nor a bullet payment gold loan is suitable for you, then the option of partial payments still exists. This allows you to repay the loan whenever you like. Unlike an EMI option, where you have to make regular payments, or a bullet option where you can close the loan only at the end, partial payments can be made at your convenience. You can pay any amount you desire at any time, irrespective of the pre-decided schedule. If you make larger principal payments in the beginning, then your interest amount reduces, thus helping you save more money.
Gold loans can also be pre-closed, that is, be paid in full before the actual due date. Whether you have opted for a gold loan with an EMI repayment schedule or a bullet payment gold loan, you can still choose to pay the full amount due before the loan duration ends. Preclosure of gold loans reduces the total interest you have to pay, thereby helping you save some interest amount that would have otherwise accumulated over the loan period. Most gold loans usually carry a pre-closure fee, though this is not the case with gold loans.
Easy Gold Loan Repayments with Rupeek
As India’s leading online gold loan lender, Rupeek offers you all the ease of gold loans from the comfort of your home. Apart from quick loan sanctions and doorstep delivery, Rupeek’s repayment options are also straightforward.
Using the online web portal or the phone application, you can choose your preferred repayment method and also make all payments online. The payment options available include Internet banking, debit card, UPI, NEFT, and money transfer using RTGS/IMPS. Rupeek offers the option to extend repayment schedules by a year after an initial 6-month repayment schedule depending on the borrower’s punctuality. In order to assist with regular payments, Rupeek also helps with timely reminders.
With our fast, convenient, and flexible services, your gold loan experience will be 100% tension-free. Guaranteed.