Personal Loans vs. Loans against gold, pros and cons

You will be encountering lots of situation in life where you will need urgent cash. In such delicate situations, you will first try seeking help from your family and friends and if you do not get any help from them, you turn your focus on getting a loan from a lender or a bank. Coming to banks, there are many loan options available which are designed to help you out in situations like this. But when it comes to needing urgent funds, there are only two options available, personal loans and loan against gold.

These loans are the best out there when you are in urgent need of money and can help you with quick disbursements. Now, let’s assume you encounter such a situation and one of your friends suggested you both the options to with. You are in a confused state on which loan should you choose, we are here to help. Here is a quick look at the pros and cons of these two loans and also a quick suggestion on which one you should choose if you are in need of a loan.

Gold loan

In this type of loan, you will need to keep collateral as the loan name suggests, that is gold. The gold can be in any form and structure and it will be with the lender until you do not pay the loan off. This is one type of a secured loan and can help you if you are seeking a short term loan. DO make sure that the payment is done on time or else the lender has the power to confiscate the gold you kept as guarantee at the lender.


No credit check

In this type of loan, the lenders do not perform a cibil check on your profile. As you will be keeping the gold as collateral, it does not matter if you are in the lower side of your credit.

Easy disbursement

The banks and lenders are ready at your disposal to give you immediate money when you show up with your gold. In some cases, the loan gets disbursed within fifteen minutes.

Low interest rates

The interest rates are low as compared to the other loans and especially compared to personal loans. This means you will be repaying fewer amounts as interest and contributing more to your principle amount.

No pre-payment penalties

In other loans, if you decide to make a pre-payment towards your principle amount, you will have to pay some pre-payment charges. This is not the case with gold loans.


High Margin

The banks only provide you loan of up to 75% of the value of your gold.

Risk of loss

Because this is one type of secured loan, if not paid in time, you are at risk of losing your asset.

Personal loan

This is one type of unsecured loan which is high in demand in the loan market. You can easily avail this loan and can use it according to you will.


Minimal Paperwork

In this loan the paperwork is minimal and the disbursement is quick. You can opt for this loan within hours and the amount will be credited to your account in no time.

No Collateral

This is the best part of this loan, even if you are opting for a huge sum of loan, you do not need to keep any collateral and get your loan easily.


You can use the loan amount according to your wish without any restrictions from the lender.


Credit history

This plays an important role if you are looking to get a personal loan. You can get a personal loan for bad cibil score, but the interest rates are off the roof.

High interest rates

This loan has the highest interest rate as compared to any other loan in the financial market.

In the end, we would suggest if the requirement is quite urgent and you have a good amount of money coming in in the immediate future, you should go for gold loan as it is easy for getting processed and you can repay your loan in no time.


7 Tips to Save Money for Your Car Loan Down Payment

Owning a car is a wonderful feeling, and not to mention it has several benefits compared to public transportation. However, the problem is that the majority of decent cars cost a lot, and even if you are earning a handsome income, chances are that you won’t have enough savings to purchase a car right away. This is why most people take car loans.

A car loan makes it easier for you to buy your dream car without breaking the bank. However, you still need to arrange for the down payment which is usually at least 10% of the price of the car. For instance, if you want to buy a car that costs Rs. 7 lakh, you may have to pay Rs. 70,000 upfront.

If you want to arrange the funds for your car’s down payment as quickly as possible, then follow these tips:

1. Let go of the Luxuries

When you want to save as much money as possible every month, then you must get rid of all the luxuries that you have in your life today. These include dining at expensive restaurants, watching movies in theaters, buying new and branded clothes, etc. Doing this is not as difficult as you think, and besides, it’s just for a short period.

2. Sell Your Current Car

If you already own a car and it’s many years old, then it’s best to sell it while you can. This is because a car is a depreciating asset which means that its value only decreases over time. Also, old cars are less efficient and increase your fuel expenses and maintenance costs. So, by selling it, you can arrange a large chunk of the down payment amount.

3. Check Your CIBIL Score

Did you know that when you get a loan for low CIBIL score, then you have to pay a higher interest rate than standard? The lender may also ask you to make a bigger down payment. On the other hand, if your score is high, then you can get a loan easily and even convince the lender to settle for a small down payment. So, you can check your score and see if it can be improved for a better deal.

4. Earn Money by Freelancing

You can earn some decent money on the side by freelancing. For instance, you can write blogs, eBooks, edit videos, transcribe, etc. to earn a secondary income. There are various websites like Freelancer and Upwork where you can find interesting and well-paying gigs that suit your requirements.

5. Sell Old Stuff

An easy way to make a quick buck is to sell the old stuff that’s lying around your house. You can sell old furniture, phones, cameras, etc. which you don’t use anymore or if they are outdated. Plus, getting rid of old items makes your home less cluttered.

6. Negotiate the Price of the Car

If the price of the car is too high, or in case you have to take a loan for low CIBIL score, then it’s best to get the best price of the car in the first place. For that, you can compare the prices at different car dealers. You can also negotiate with them and see what’s the best price they can offer. When the car’s price is the best already, then the down payment lowers automatically.

7. Work Overtime

Does your company pay more for overtime? Or are there are any extra assignments that you can pick to be paid extra? You can look into these options and see if you can spend more time at work to earn more money. This can surely make it easier for you to arrange the funds for your dream car’s down payment. Just make sure that you don’t exhaust yourself with too much work.

Car Loans are quite helpful for many people, but they can be tricky as well. So, don’t rush into getting a loan and compare all your options. Also, don’t forget to check your CIBIL score before you approach any bank. Your car loan’s interest rate and terms can be greatly affected by the score itself. Good luck!

What you should do if your loan gets rejected

When you are in desperate need of funds and applying for a loan is the only option left for you. You take every measure to get your loan approved and even after such a struggle if the loan gets rejected, that is like the worst feeling ever. You loan can be rejected due to a lot of reasons associated to the same. it can be anything and to your surprise, you won’t be knowing anything about that subject and that could be the first time you would be listening to the same.

Have you ever heard that you may be denied a loan because of the area you stay in. yes, this is also one of the main criteria’s to get the loan sanctioned. There are many such small things associated which leads to your loan rejection. If you happen to have a low cibil score, you cannot expect your loan to get sanctioned that easily. You can still get a loan for low cibil score, but the chances are the loan processing fees and the interest rates will be on the higher side as per market standards.

But the main question lies here that how your loan gets rejected and if it’s rejected what are your options,

How loans get rejected

No credit

If this is the first time you are applying for a credit, there are high chances that the loan plea will be rejected. The lenders need some lending background towards your account just to understand the payment patterns and determine if you are credit worthy.

Low cibil score

This is one of the main reasons you can get your loan rejected. If your credit score is low, the lender will directly reject the loan, as you happen to have a bad credit history.

Low Income

If you are applying for a large amount of loan and the income is low, the bank will deny you a loan due to inadequate funds to repay the loan.

To many debts

The lenders will asses all your loans and lines of credit before they can determine giving you a loan. You will have to make sure; you have fewer loans on your name and more income towards your account.

Other reasons

There are many other reasons the lender may consider if they want to cancel the loan plea. While applying for a loan you will have to make sure you are up to the mark at every aspect of a loan trade.

What to do when you are denied a credit?

Use collateral

This is the best way to get any type of a loan. When you keep collateral towards your account and apply for a loan, the loan is considered to be a secured one and you get a credit with ease. If you do not pay your loan on time, the lender has the power to seize your property and put it on auction. Its better you make payments on time.

Get a co-signer

If you know for a fact that you will be denied a loan, try getting help from family and friends. Get a co-signer to sign the loan application and apply together. This way the bank has assurity that you will make the payment on time and you will make the payments on time because you don’t want to end up having a low cibil score.

Apply somewhere else

This is the only option left. Though you will have multiple inquiries on your credit account but it’s worth a try if you are need of urgent funds.

There is very less you can do when applying for a loan other than praying that your loan should be sanctioned. Just make sure your credit basics are clear and it should be a piece of cake for you getting a loan.