A Guide To The Gold Loan Renewal Process

Planning for a gold loan & have no clue about its repayment options? No worries, here you will get detailed guide on gold loan renewal process. Visit Now!

8 Aug,2022 13:20 IST 270 views
A Guide To The Gold Loan Renewal Process

When you take a gold loan, you get a loan amount based on the gold loan interest rate, which you are legally bound to repay the lender within the loan tenure. However, once you have repaid the gold loan or the loan tenure has ended, you can take a new gold loan by pledging the same gold articles with the current lender.

This gold loan renewal process allows the borrower to apply for a quick gold loan based on a prior financial relationship with a lender. As the lender already knows the eligibility criteria and has done background checks on the borrower, taking the new gold loan becomes hassle-free and ensures immediate capital raising for the borrower.

Merits And Demerits Of Renewing A Gold Loan

Renewing a gold loan is easier if the borrower has just repaid a previous gold loan to a lender. Here are some merits and demerits to let you better understand if you should renew your gold loan:

Merits

• Deeper Understanding:

Renewing a gold loan is a good option as you have a deeper understanding of the terms and conditions of the lender that comes with the gold loan. As you know the rates and charges of the gold loan, you are in a better position to understand the product

• Documentation:

Since you have taken a gold loan with the lender, they are also aware of your repayment capability and financial situation and have all the documents needed to apply for a gold loan. This expedites the new gold loan process as all the due diligence was completed previously

• Instant Approval:

If you renew your gold loan with the same lender, the entire gold loan takes only a few hours. With the due diligence already done along with the documentation, the loan is disbursed instantly

Demerits

• Gold Value:

The gold value may decline during the tenure of your previous gold loan. In such a case, the lender will value your gold articles at a lesser amount than the last time, and you will get a lower loan amount

• Interest Rate:

During the repayment tenure of the last gold loan, new loan products may have come to the market offering lower interest rates on the gold loan. Renewing the gold loan may force you to pay more

• Terms And Conditions:

The lender may have changed the terms and conditions along with the rates and charges of the gold loan product. The renewal can financially hurt the borrower

Gold Loan Renewal Process

The gold loan renewal process differs from lender to lender. Here are the standard steps included in the gold loan renewal process:

1. OTP Verification:

Enter your mobile number and date of birth to verify the OTP on the lender’s website

2. Customer Details:

Enter the details about yourself, such as your name and email ID, along with providing identity proofs to complete the KYC

3. Verification:

Once you have submitted the application form after filling in the customer details, the lender will verify and approve

4. Disbursal:

Once your gold loan renewal application is approved, you will get an instant disbursal of the approved loan amount into the bank account

Apply For A Gold Loan With IIFL Finance

IIFL is India’s leading financial services provider that offers various financial products, including gold loans. The gold loan renewal process is quick and hassle-free, and the loan comes with the lowest fee and charges, making it the most affordable loan scheme available. The online loan process offers industry-best benefits to ensure you enjoy a hassle-free loan application and disbursal process within 30 minutes of application.

FAQs

Q.1: Is a Gold Loan renewal the same as a gold loan extension?
Ans: No, gold loan renewal means to take a new gold loan with the same lender after the borrower has repaid the previous loan. A gold loan extension extends the loan tenure.

Q.2: Do I need to repledge my gold articles for renewing the gold loan?
Ans: Yes, as the price of gold may have changed, repledging the gold articles will ensure that you get the highest gold loan amount based on the current gold value.

Q.3: What is the gold loan interest rate on IIFL Finance Gold Loans?
Ans: IIFL Finance offers an attractive interest rate starting from 1% per month. The rates may vary according to the amount, tenure, and purity.

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