PERSONAL LOAN VS GOLD LOAN VS HOME LOAN TOP UP
Pros • • • • • • •
Instant Approval Fast Disbursal Flexible repayment option Collateral free No guarantor required Can get approved for a high loan amount No restriction on the end-use of money
Cons • • • •
High-interest rate as compared to the other two More financial burden High EMI Low tenure period
Personal Loan Personal Loan is the most exploited option but certainly, it is not the only option that can be availed during emergency monetary needs.
Pros • Fast loan approval • Flexible repayment tenure • Low-interest rate
Cons • The high margin between the price of gold and loan amount approved • Short repayment tenure • Only those can have who have gold • You may not get the amount which you need
Gold Loan A gold loan is a secured loan. A gold loan can be taken by collateralizing your gold ornaments. One can avail 60% to 70% of the gold value as a loan. The loan amount can go up to 90% if the borrower ready to pay a higher rate of interest.
Pros • • • • •
Minimum Documentation Fast Processing No restriction on the end use of the money Tax benefits can be availed Low-interest rate
Cons • Available only to the existing user • Can be availed only from the bank from where you have an existing loan • Increase in EMI
HOME LOAN TOP UP
If you are an existing home loan borrower, you have an excellent way of getting additional fund which is called a home loan top-up. The interest rate is generally 1% to 2% higher than a home loan..
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Personal Loan
Gold Loan
How To Choose the Best One? • To find out the best among the three, some parameters which we need to look.
Home Loan
Parameters to Choose the Best One
• • • • • • • •
Interest Rate Processing Fee Tenure Time of Disbursal The Risk Factor Tax Benefit Eligibility Loan Amount
• Interest Rate • Compare and check interest rate. After comparing home loan top up is the low interest rate
• Processing Fee Processing fees varies from one bank to another but highest processing fee for personal loan. Lowest is top up home loan.
• Tenure The tenure of a home loan top up is up to 30 years whereas the maximum tenure of a personal loan is 5 years. The gold loan can also be extended to 5 years.
• Disbursal Time • Compare to home loan top up and gold loan personal loan get disbursed faster.
• The Risk Factor The risk factor is near to nil when you avail a personal loan. Whereas both gold loan and home loan top up are secured loan and if you are unable to pay the loan off, your assets are at the risk of being liquidated by the lender.
• Tax Benefit Among the three ways of availing additional fund, the only way which makes you avail tax benefit is a home loan top up.
• Eligibility • To avail a home loan top up, you are to be regular in paying your EMIs till three years. The eligibility criteria for a personal loan is the credit score and the repayment capacity. The gold loan eligibility criterion is nominal.
• Loan Amount The maximum loan amount which one can avail by a home loan top up is 60% to 70% of the property value. In the same way, the loan amount of a gold loan is again 60% 70% of the gold value in the present market. The maximum loan amount one can get availing a personal loan is Rs.25 to Rs.30 lacs.
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