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Different Types of Secured Loans

At times, you will be in an emergency wherein you will require a large amount of financial aid. In such an even, you can apply for a loan. You can either apply for a secured or a non-secured loan. Between these two options, the secured loans will provide you with the ideal rates, better repayment options and even a short application process which is required during an emergency. Additionally, since you are providing collateral, you can negotiate for a better principal amount. Some of these secured loans include the loan against gold items, securities or even property. Here we will give you information about each option.

Gold Loan

Loan against gold is one of the most favourable options when it comes to the secured loans. This is due to the fact that many individuals, especially in the country believe in investing in gold for economic and cultural aspects. Many families invest in gold jewellery, coins, bars or even other items for various auspicious or special occasions. During a financial emergency, an individual can easily apply for a gold loan just by exchanging these gold items. One of the major benefits of this account is that, the application process is short. Once these items are verified and the value of the gold confirmed, this will be provided at most of 85% of the confirmed value. It additionally comes with beneficial interest rates and easy repayment tenure.

Loan Against Securities

Like the loan against gold, loan against securities is another option during any financial emergency. You can consider this option if you have invested in shares or stocks in beneficial options, which you can afford to liquidate during an emergency. Additionally, if you can repay the amount in the given repayment tenure, you can easily opt for this option. The amount you can get from the securities and stock depends on the valuation, margin allowed by the bank and your past credit history. You can get at most 70% of the value of pledges you have invested in the bank. Once you pledge your shares with the bank, you will be issued a current account The advantage of the loan against shares is that you will be charged interest only on the amount you withdraw from the account. Additionally, you will be charged for the duration of the time the funds are utilized.

Loan Against Property

Like the gold loan and loan against security, the loan against property is another option for a secured loan. In this option, the borrower will provide his home as a form of security. However, the ownership of the property is still under the borrower until he can repay the lamount. If you have all the necessary papers and insurance for this option, you can easily apply for a loan and get an amount of at most 80% of the value of the house.