Gold has transitioned from a symbol of beauty in jewellery to a valuable financial asset in India. It is a sought-after investment and a practical solution for urgent cash needs, such as business expenses, unforeseen costs, or medical emergencies. Here’s a detailed look at how a Gold Loan operates:
A Gold Loan is a secured loan where you pledge your gold as collateral to the bank. That means the bank holds your gold during the loan period as security against the loan amount. You will be charged interest on the loan amount, and once you have fully repaid the loan, including interest, the bank returns your gold to you.
Not all types of gold are accepted for loans. Typically, banks will only accept gold jewellery as collateral. The purity of the gold should fall between 18K and 22K. This standard ensures that the gold used for collateral maintains a certain level of value and quality.
Banks usually offer Gold Loans based on a Loan-to-Value (LTV) ratio. This ratio determines the maximum loan amount you can receive relative to the market value of the gold you pledge. Most banks provide up to 75% of the current market value of the gold as a loan. For example, if you mortgage gold worth ₹100,000, the maximum loan amount you can receive would be ₹75,000.
The process of obtaining a Gold Loan involves several key steps:
At HDFC Bank, the Gold Loan process is streamlined for efficiency. You can receive a Gold Loan within an hour of application, making it a swift solution for urgent financial needs.
With the above understanding, you can confidently apply for a Gold Loan from HDFC Bank. For a hassle-free application process and to receive funds quickly, Click here to send your Gold Loan application.
Terms & conditions apply. Gold Loan disbursement is at the sole discretion of HDFC Bank Ltd. The information provided is for informational purposes and may not substitute specific advice based on individual circumstances.