Advantages of Financing Your Overseas Education with a Gold Loan

Higher education is a goal for many due to the umpteen opportunities it offers. However, this requires a hefty sum that can result in the depletion of your savings or taking on high-interest credit. Both of these can be detrimental to your financial well-being.

However, a more accessible and cost-effective solution to manage such high costs is availing of a gold loan. With a low gold loan interest rate offered by most lenders, you can get financing at an affordable cost, keeping your budget intact.

While a gold loan may seem a non-traditional way to get funding for your education abroad, it offers numerous benefits that make it a smart option. Read on to know the advantages of taking a gold loan for overseas education.

Why Choose a Gold Loan?

When applying for a gold loan to manage your overseas education costs, there are a number of perks you can get on your loan. Here are some of them.

Simpler Eligibility Criteria

When you apply for a gold loan, eligibility criteria are relatively lenient and inclusive. This means that anyone can take a loan against gold assets. To avail of the loan, you do not have to furnish a long list of documents or go to lengths to prove your credibility.

This makes the loan process simpler and easier for any borrower. As such, getting the funds for higher education is simple when you choose to get a gold loan.

Complete Coverage of Expenses

You can cover all costs associated with the undertaking when you opt for a gold loan. This form of credit may be the right option to cover your off-campus expenses that, include accommodation, food, clothing, travel costs, etc. This benefit isn’t applicable to the traditional education loan, as the funds are only used for tuition costs.

No Guarantor or High Credit Score Required

With a low credit score or without a guarantor, it can be difficult to take an education loan. However, as a gold loan is a secured form of credit, you can obtain the required finances by pledging your gold jewellery as collateral.

The lender may even offer a lower gold loan interest rate even without a higher credit score.

Loan for Any Courses

You can fund the loan amount for any college and course you prefer. However, this may not be the case when you opt for an educational loan. This differs from an education loan since the lender may prioritise top or renowned colleges.

Helps Cover Partial Educational Fees

The loan amount depends on the value of your pledged jewellery. Hence, you can adjust the loan amount easily from your end. If you need financial assistance to cover only a part of your course expenses, you can conveniently apply for the required amount.

Advantages of Increasing Rates

When availing of these loans, you can take more credit as your sanctioned loan amount depends on the existing gold rates. Hence, you can take advantage of these rising gold rates and increase the loan amount accordingly. The benefits of a gold loan allow you maximum financing with a fixed volume of gold assets.

Advantages of a Gold Loan over an Education Loan

Lower Interest Rates With a secured loan, lenders have a lower risk, so the gold loan interest rate is low. You can even get interest rates starting from 8.28% p.a., depending on the lender and other factors such as loan tenure, gold market price and LTV ratio.

Flexible Repayment Term

You can choose repayment tenure and payment frequency at your convenience. In addition to the standard EMI payment plan, you can also choose between bullet and interest EMI options.

With bullet repayment, you can pay the total principal amount with interest at the end of the tenure. Another option is to pay the interest as EMI throughout the tenure and finally pay the principal amount at the end of the loan term.

Easy Approval

Anyone who can pledge their gold jewellery, coin or other assets can avail of a loan. You can get high credit for your collateral based on your gold amount and market value. Hence, gold loans have a high approval rate with quick disbursement.

Many lenders prefer to give education loans to students who apply at renowned institutions or study professional degrees, such as MBBS, LAW, engineering, etc. With a gold loan, you can take financing irrespective of your career option or degree of choice.

Minimum Documentation

To avail a gold loan online or offline, you can apply with minimum documentation for hassle-free financing. You can get a loan for overseas education without the need to provide any documents of acceptance from your college.

You can use the loan amount to cover all pre-admission costs, which include buying a brochure, sending multiple applications, application form charges, fees for evaluation tests, travel costs, etc.

No CIBIL Score Check

As mentioned, you do not require a high credit score to avail of this form of credit. However, some banks and NBFCs may ask you to submit your credit report to assess your repayment capability for a gold loan. Maintaining a good CIBIL score can help you get a higher loan amount.

No Guarantor Required

Usually, a guarantor is required when you apply for a loan without a credit score. You can pay the required amount to cover your overseas education costs without any guarantor. Instead, your pledged assets are sufficient for the lender to provide financing.

No End-Use Restrictions

From tuition to accommodation, there are a number of expenses when studying abroad. With a gold loan, you can cover all these expenses stress-free. Furthermore, this gives you the privilege to spend the amount of your loan in the way you prefer.

No Pre-Closure Charges

Many banks and financial institutions charge a small percentage of the remaining loan amount as a pre-closure charge when you close the loan before the term

ends. However, when you take a gold loan for education or any other use, you can pay it back before the complete tenure without any additional charge.

With all this information, you can make the right decision for your gold loan and finance overseas education smartly and affordably. The availability of low gold loan interest rates gives you the flexibility to cover all your financial requirements with a secured loan from any trusted lender.

The lender will return your gold asset back in the same condition after you have repaid your complete loan.