Taking a loan is one of the most reliable options to arrange emergency money. Gold loan is where one can fulfil his or her need for cash without selling the gold ornaments but keeping it as collateral for a decent sum of money. So availing a gold loan is a good idea to generate cash without selling them. If you possess golden ornaments, you approach a lender easily. Here we will give an overall information on SBI Gold Loan eligibility criteria and interest rate.
Eligibility for availing SBI Gold Loan
Just like other loans that are provided by several banks and NBFCs, one should meet the eligibility criteria to get approved for a gold loan. Here we will discuss the eligibility criteria that one needs to meet to get an SBI Gold Loan.
Age: To avail an SBI Gold Loan, there is a certain age limit. The applicant who wants to avail SBI gold loan must be minimum 18 years old.
Profession: The applicant can apply singly or jointly. Both the applicant must have a steady source of income. He or she can be a service person or self-employed or pensioner. There is no need to show an income certificate.
Interest Rate for SBI Gold Loan
There are three types of gold loans that are offered by the State Bank of India. This classification is done based on the repayment method. They are described below:
- Gold Loan: In this type of gold loan, the repayment of the principal amount along with interests will be commenced from the next month of the disbursement month. The repayment period for this loan is a maximum of 36 months. The bank charges an interest of 25% for this loan.
- Liquid Gold Loan: For this kind of Gold loan, the bank offers an overdraft account, with full transaction facility. The bank also will provide standard interest on the account. The interest rate and repayment period are the same as the Gold Loan; that is, the maximum repayment period is 36 months, and the interest rate is 25%.
- Bullet Repayment Gold Loan: This loan is offered with a repayment period of 12 months, and the interest rate is 35%.
Other important factors
Apart from these interest rates, the bank also charges a processing fee, that is a 0.50% will be charged on the loan amount along with applicable GST. 1.25% above the MCLR of one year. The applicant also needs to pay the gold appraiser charges. The applicant can get any amount from INR 20,000 to INR 20 lakhs. The applicant can pledge any gold ornaments along with gold coins sold by several banks. All those will be dully verified for quantity and quality purposes.
Required documents
At the time of application, the applicant needs to submit two copies of photographs, identity proof, address proof. If the borrower is illiterate, a witness letter is also required. At the time of disbursement, arrangement letter, gold ornaments delivery letter, DP note along with DP note take the delivery letter.
Therefore, an applicant needs to go through the eligibility criteria along with the interest rate to be more confident while going for applying for an SBI Gold Loan. One also should read the terms and conditions carefully to avoid any hidden clause.