Medical emergencies can arise at any time and catch you off guard. While your first priority is to provide the best treatment for your loved one, arranging funds at short notice for expensive medical procedures can be stressful. This is where a gold loan can come to your rescue.
Gold loans are one of the quickest and most convenient ways to get funds during medical crises. Offered by financial institutions, these loans use your gold jewellery as collateral and provide you with immediate liquidity. Read on to learn the top gold loan benefits for medical emergency and make informed decisions.
Quick Disbursal of Funds
One of the biggest gold loan benefits for medical emergency is that it provides you access to funds in just a few hours. This is because gold jewellery is approved as collateral instantly by loan providers. There is no lengthy paperwork or processing involved.
Once you submit your KYC documents and gold ornaments at the branch, the loan amount is disbursed on the same day. This enables you to quickly arrange finances for hospitalisation, treatments, and other medical expenses without any delay.
High Loan-to-Value (LTV) Ratio
Gold loans come with a high loan-to-value (LTV) ratio of up to 75%. This means you can avail a loan amount of ₹75,000 against gold jewellery worth ₹1 lakh. The high LTV ratio allows you to leverage the value of your gold and get larger loan amounts to cover medical costs.
Flexible Tenures
These loans are available for both short and long durations. Depending on your repayment capacity, you can repay the loan over a few months to a couple of years or more. This allows you to choose a tenure that suits your income flow. The flexible repayment options are especially useful when funds are required immediately during medical emergencies.
Affordable Interest Rates
Gold loans offer lower interest rates compared to other unsecured loan options. Interest rates start at around 7% per annum. This makes gold loan for health treatment affordable during medical emergencies compared to other financing options like personal loans and credit cards that come with higher interest rates. The low-interest costs help reduce your financial burden.
Quick Processing
Minimal documentation and eligibility criteria make gold loans quicker to process compared to other loans. There is no need for proof of income or credit score checks. As long as you submit your KYC documents and gold jewellery, the loan for health treatment can be processed within hours. This accelerated process enables you to get funds in hand immediately during medical contingencies.
Retain Ownership of Gold
The gold ornaments pledged remain in your ownership throughout the loan tenure. The lending company only places a lien on the jewellery until you repay the loan. This means you do not have to worry about permanently losing your precious gold assets. You can redeem the jewellery anytime by repaying the outstanding loan amount.
Foreclosure without Penalty
Most financial institutions allow you the flexibility to foreclose the gold loan for health treatment anytime without levying foreclosure or prepayment penalties. You can repay the entire loan amount sooner than the chosen tenure if funds improve. This avoids additional interest costs and lets you redeem your gold jewellery faster. The lack of foreclosure charges provides financial relief during medical emergencies.
Minimal Documentation
To avail a gold loan, you just need to provide basic Know Your Customer (KYC) documents like identity proof, address proof, passport-size photos and other eligibility papers. This is unlike personal loans that require you to submit income statements, bank statements, Income Tax Returns (ITRs) and other papers. The minimal documentation enables quick sanction and disbursal of the loan amount.
End Use Flexibility
Gold loans offer end-use flexibility. This means the loan amount can be used for any purpose, and the loan provider will not ask for details of end usage. You have complete freedom to use the loan amount for hospital expenses, medicines, doctor fees or any other medical requirements. The flexibility of usage makes gold loans well-suited for medical contingencies.
How to Get a Gold Loan for Medical Needs?
Here is a step-by-step process on how to get a gold loan for health treatment when faced with medical emergencies:
- Estimate the Cost of Treatment: Assess the overall cost of medical treatment, including hospital charges, medicines, tests, doctor fees, etc. This will help determine the loan amount required.
- Choose a Lender: Compare interest rates and loan features offered by top financial institutions like banks, non-banking financial companies, etc. Select one that suits your requirements.
- Visit the Branch: Schedule an appointment and visit the lender's branch with your gold jewellery and KYC documents.
- Get Gold Appraised: The gold ornament will be valued based on purity and weight. The loan provider will inform the maximum loan amount you are eligible for.
- Get Loan Approved: Once approved, you need to fill out a loan application form and sign the loan agreement. The pledged gold will be stored in the branch locker.
- Receive Funds: The sanctioned loan amount will be immediately transferred to your bank account or handed over in cash.
- Repay Loan: You can repay the loan amount through Equated Monthly Instalments (EMIs) according to your chosen tenure and interest rate. Once the loan is closed, you can get your gold jewellery back.
Summing up
Gold loans offer a quick, convenient, and affordable way to arrange funds instantly during medical emergencies. From nominal documentation to flexible tenure and loan amount, gold loans check all the right boxes when urgent money is required for treatment. Compare offerings from top financial institutions and choose a gold loan to ensure your loved ones get timely medical care without financial constraints.
