There are many ways in which people today transact in this yellow precious metal. Some people sell them for immediate returns. Others exchange them for better articles. Some might use the money to meet their financial ends. Others might invest the same money into other assets. One of the most popular ways of doing so is taking a Gold Loan. It comes with numerous advantages. You do not have to completely let go of your articles by selling them. You can get them back after a certain time period and reuse and repurpose them. People just have to pay the loan amount in time. They can then get their accessories back after the dedicated period. Usually, the returns you get on a Gold Loan are instantaneous. You get immediate cash right in your hands. Because the lenders are usually quick to do so.
This allows you to further take care of your expenses more effectively. The common lenders include government and private banks, as well as non-banking financial companies (NBFCs). Taking a Gold Loan is also a very easy process. The firms are also very easy to reach and access. The procedure is generally quick. Everything is very convenient and comfortable. Why then, do financial experts never advise taking such loans? Why is pledging your ornaments a bad thing today? What is wrong with getting such immediate returns on your prized possessions? Read ahead to find out the different disadvantages of taking a Gold Loan.
The Problems with Gold Loan
It is true that you get immediate returns on your articles by pledging them. And the lenders are very quick in giving you the money. But this is only because it is their profit, and not yours. They benefit more than you think from such transactions. First and foremost, they will not give you the full value of your articles.
You will hardly get close to 70% of the worth of your ornaments. And maybe, even lesser. So, you cannot go there with certain expectations. Also, you might even have to revamp your budget and expenditure because of the fewer returns.
On top of that, a Loan On Gold comes with the proposition to pay monthly installments. You have to repay the loan amount in parts every month. And these installments come with very high-interest rates. By the end of the deal, people sometimes end up paying double what they got in the first place!
So not only do you get lesser value on your transaction, but you also end up paying more in return. You are basically losing money, not gaining it. There is no profit involved in pledging your precious ornaments. It is like selling your possessions for a huge loss.
The firms might also have different hidden charges and transaction fees with them. Such excess expenses on a Loan Against Gold are not a profitable proposition at all. They take away a huge chunk of your money.
This is the reason why experts never advise you to pledge your items. You might get instant money to meet your monetary ends. You might even become capable of managing your rising expenses. But you will end up losing a lot more. And the problem does not even end here.
The Situation Worsens
As you already know, the pandemic caused numerous financial problems for the people. Many even ended up losing their jobs. The economy went into a historic recession. The worth of many other monetary assets started depreciating. People hence relied on selling Gold For Cash to meet their ends. Because the value of this metal is immensely high in the market.
But there were others who preferred a loan because of its apparent benefits. Now due to their monetary crunches, it is hard for them to always be punctual and regular with their payments. Always paying the installments along with interests on time is close to impossible.
And this is what the lenders take undue advantage of. If you fail to repay your loan amount, then they will seize your articles. They reserve the right to permanently seize your articles on the failure of the repayment of Gold Against Cash.
Hence, you won’t even be able to get your articles back properly. You don’t know if you will really get them back or not. There is a huge risk and uncertainty involved in such a deal. Also, you will lose all the earlier installments and interests that you paid. Thus, it is a very big loss for someone to deal with.
You not only lose your extra money, but also the very ornaments that you pledged. This is why such deals are never advised by professionals. But if you have already taken such a loan, then it is best to get them settled.
Settling the Affairs
You can get great Cash For Gold if you settle your loans and sell your articles to professional firms. Companies like Cashfor Gold and Silverkings Pvt Ltd can help you with both processes.
All you have to do is tell them your dilemma. And they will arrange all the necessary funds to pay the lenders on your behalf. They will then release your pledged items and prevent them from being seized. Moreover, you won’t even have to worry about any high-interest rates and excess charges.
You can pay the amount in convenient installments. Also, you have the option to either keep the articles or sell them for great Cash Against Gold. They are professional buyers in the industry. They are reputed for giving people the best returns on their prized possessions.
You can easily get the highest returns on your ornaments from them. They are reputed for using the best industry-grade testers and equipment. Using them, they proficiently evaluate your articles and determine the true worth they have in the market.
They test the quality, purity, weight, composition, karat value, type, etc. of your ornaments. And then they determine the best price to pay you against them. Also, after the deal, they give you immediate cash right in your hands!
