Is Gold Loan the Right Choice For Funding Your Travel Plans?

Gold Loan

The allure of traversing uncharted territories, immersing oneself in vibrant cultures, and embracing the world’s wonders is a dream shared by many. Yet, as life’s responsibilities and financial challenges arise, the desire to travel often takes a backseat. While the wish to embark on globetrotting adventures is strong, the reality of financial constraints often poses a significant hurdle. Liquidity crunches can dampen our travel dreams, making it seem impossible to fund such experiences. Traditional sources of financing may come with lengthy approval processes, high-interest rates, or inflexible terms, further exacerbating the challenge. However, there is a brilliant solution waiting to be embraced.

What if we tell you that there is a gleaming solution that can transform your travel aspirations from mere wishes into tangible experiences? Yes, you can get a gold loan to go travelling to your favourite places. Prepare to discover the power of gold loans for travelling, where liquidity crunches fade away, and your dreams of exploring the world become a sparkling reality.

What is a gold loan, and how does it work?

A gold loan is when you take out a loan from any Financial Institution and use your gold jewellery as collateral. The officials evaluate the worth of your gold and provide you with a loan depending on its worth. They hold your gold as collateral until you return the borrowed funds. The gold is returned to you once you have repaid the loan (principal plus interest amount).

Obtaining a gold loan is an easy and quick process. To get started, first of all, visit a lender’s office, fill out an application form, give your identity and address proof, and hand over your gold to the lender. The lender will examine your documents and gold before releasing the loan funds to your bank account or in cash.

Benefits of Getting a Gold Loan for Your Travel Goals

Easy and Quick Approval Procedure

A quick and simple approval process for gold loans makes them a desirable choice for securing cash immediately. In contrast to conventional loans, which need excessive documentation and verification, gold loans are backed by your gold assets, which reduces the need for tedious paperwork. Therefore, you can easily acquire a gold loan for your trip expenditures if you own gold jewellery or other gold items.

Little to No Credit Checks

For those with less-than-ideal credit histories, getting a loan can be a difficult endeavor. Gold loans, on the other hand, are secured by collateral (your gold assets), which lessens the significance of credit ratings in the approval process. You can obtain a gold loan regardless of your credit background as long as you own gold assets of adequate worth. Due to its accessibility, gold loans are a great option for people who would have had trouble acquiring loans through conventional channels.

Flexible Loan Terms and High Loan Amounts

The possibility of obtaining a substantial loan amount is one of the notable benefits of a gold loan. You can get a sizeable quantity to help pay for your vacation plans because the loan amount completely depends on the value of your gold holdings. Furthermore, gold loans provide adjustable payback terms that let you pick a schedule that works with your financial resources. Gold loans provide essential flexibility, whether you desire a short-term loan for an unscheduled vacation or a longer duration to fit your budget.

Retain Ownership of Your Gold

One of the significant benefits of a gold loan is that, even if your gold is used as security, you keep ownership of it for the duration of the loan. Your gold is returned to you when you have fully repaid the loan. This implies that you can pay for your vacation expenses without permanently selling up your priceless possessions. Due to this characteristic, many people with negative and good credit scores find gold loans to be an appealing option.

Minimum Due Payments

In instances of emergencies where customers face financial constraints and are unable to fulfil their essential payments, an alternative known as the minimum due option may be presented. This option enables customers to maintain their loan accounts by making smaller payments. The payment will include a small portion of the principal amount and a portion of the interest, ensuring some progress is made toward fulfilling their obligations.

Some Cons to Consider When Taking Gold Loans for Funding Your Vacation

Impact on credit score and risk of losing precious assets

Gold loans offer an advantage over unsecured loans as they do not consider your credit score during the approval process. However, it’s essential to make the interest payments on time, to avoid potential harm to your credit report, which could affect your future loan eligibility.

Additionally, since gold loans require offering your valuable assets as collateral if you are unable to repay the loan, the lender may retain possession of the gold in such circumstances.

Eligibility Criteria for Getting a Gold Loan for Travelling Goals in India

The eligibility criteria to get a gold loan varies depending on the lender, but some common factors are:

You must be an Indian citizen.
You must be 21 years old.
You must have gold items of at least 22 karat purity.
You must submit the required documents for KYC such as address and Identity Proof.

Ways to Apply For a Gold Loan for Funding Your Holiday Trip

Muthoot Finance offers India’s best gold loans for travelling to your dream destinations. There are various options to apply for a gold loan at Muthoot Finance, such as:

You can apply online for a gold loan for leisurely travel motives by visiting our website or downloading our iMuthoot app or Gold Loan at Home and filling in the required details.
Visit any of our nearest branches and submit your gold items along with your identity proof and address proof.
You can opt for our Gold Loan at Home service online or through their Gold Loan at Home app (which is an at-home gold loan service), where our representative will visit your home and complete the loan process.

Scenarios Where a Gold Loan Can Be a Suitable Option for Travel Funding

Urgent Travel Plans: If you have sudden or time-sensitive travel needs, a gold loan can provide quick access to funds without lengthy approval processes.
Limited Access to Traditional Loans: When faced with credit score challenges or limited access to traditional loans, a gold loan offers an accessible alternative due to its collateral-based nature.
Competitive Interest Rates: With competitive interest rates compared to unsecured loans, a gold loan can be a cost-effective option for financing your vacation.

What other options to consider for funding travel plans besides a gold loan?

There are other solutions to consider for financing vacation arrangements than a gold loan. These include taking up personal loans from a reputable NBFC like Muthoot Finance, utilizing credit cards with favorable terms, looking into loans designed specifically for travel, and using savings or investments. Consider each choice in light of your interests and financial circumstances.