What happens to gold loan after death?

If a borrower passes away before repaying a gold loan, the responsibility to settle the outstanding dues falls on the legal heirs or nominees. The lender will inform the nominee or legal representative about the pending loan and the amount due. Upon repayment of the outstanding principal and interest, the pledged gold will be released to the nominee or legal heir. If the dues are not settled within a reasonable period, the lender may auction the gold to recover the outstanding amount, after following due legal process. Any surplus from the auction, after settling the dues, is returned to the legal heirs