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Gold loans are also known as a loan against gold. These are secured loans taken by borrowers against the gold that they own and want to pledge as collateral; the pledged gold may be in the form of jewellery or coins. The loan amount sanctioned by the lender is a percentage of the gold’s value that is pledged as collateral.
If you need a loan against some or all of the gold you have, how much loan can you get? This is where gold loan calculators can come to your assistance. A gold loan calculator is a tool that allows you to calculate the worth of your gold and how much loan you can get against it based on the cartage of the pledged gold.
As we said above, the gold loan amount you are eligible for will depend on the purity of the gold used as collateral. It also depends on lender policies and the gold price.
Loan to Value (LTV) Ratio for a gold loan varies from lender to lender; LTV is the amount of loan that lenders sanction as a percentage of the asset value.
Gold prices vary from day to day; 30 days average price of 22-carat gold, which is adjusted down for purity, is used to calculate the gold value and the loan eligibility per gram.
Below is a table indicating gold loan eligibility, assuming the average gold price for the last 30 days to be Rs. 49712 for 22 carats, and the LTV ratio as 75%.
|Gold Purity||Weight (Gms)||Average Gold Price||Eligible Gold Loan Amount|
* Please bear in mind that the above table is indicative and for example only; the actual loan against gold can vary depending on a host of factors.
Gold loan interest rate also varies from lender to lender. The loan amount along with the interest rate and the loan tenure determines the gold loan EMI that the borrower has to pay.
Gold Loan EMI is the amount that you have per month to the lender to repay the amount that you have borrowed; the EMI has an interest and principal component.
Gold loan EMI Calculator helps you to calculate your monthly EMI at the effective interest rate for a particular tenure. Below is a table that compares gold loan EMI depending on duration and interest rate.
|Loan Amount (Rs.)||Loan Tenure||Interest Rate||Gold Loan EMI|
|100,000||12 months||10%||Rs. 8792|
|100,000||24 months||10%||Rs. 4614|
|100,000||12 months||12%||Rs. 8885|
|100,000||24 months||12%||Rs. 4707|
Shriram Gold Loan is available at convenient terms; interest rates start from 11.5% with a flexible repayment schedule. If you want to know your gold loan EMI, you need to simply click on the Shriram City Gold Loan EMI Calculator and key in details like the amount of loan you want and the loan tenure. Based on the data that you enter, the EMI amount is calculated.
Using the EMI calculator can help you in planning your finances before applying for a loan so that you borrow only an amount you can repay comfortably.
Shriram City offers a host of products to suit your various financial needs; Shriram Gold Loan is a product that has been designed keeping in mind the customer’s needs. Below we list the features of the product and why it should be your preferred choice:
Most gold loan lenders offer loans at a fixed rate, but some may offer them at floating interest rate too.
The EMI paid every month has a principal component and an interest component. Some lenders allow the borrower to pay the interest component every month, and the principal component can be paid at the end of the loan tenure. Some lenders may allow interest components to be repaid upfront at the time of gold loan sanction, and the principal can be repaid at the end of the loan tenure. Another variation is the bullet repayment option, where both the principal and interest components are repaid when the loan tenure ends.
In the case of any financial product, it is important to research well and read all the fine print before signing the dotted line especially in the case of loans. Choose a gold loan that suits your requirements well and which you can repay easily; tools like the gold loan EMI calculator can aid you in your decision-making process.