Know about Gold Loan eligibility - Ruptok Fintech

  • By Ruptok
  • January 27th, 2022

Utilising a gold loan is a rapidly growing trend in order to secure swift financial remedies. Gold, which is typically found in bank lockers, is being removed and utilised for its financial benefit. It’s interesting how little is known about gold loans, which makes it difficult to understand the precise steps involved in sanctioning a gold loan. So how do you start?

Determine your eligibility for a gold loan as the first step. However, the actual question is how to get the maximum principal amount on a gold loan as many banks and Non-Banking Finance Companies (NBFCs) who offer gold loans have online calculators for this. Here is a brief, three-step strategy to understanding your loan eligibility in full:

  1. Understanding LTV and Per Gram Rate

To determine your loan eligibility, it’s critical to understand the price of gold per gramme, which is the price of 22-carat gold at the time the loan is requested. Once you have this knowledge, you can use the LTV, also known as the loan to value ratio, to calculate the gold loan rate per gram.

The simplest definition of the LTV is that it is the maximum loan amount that may be obtained based on the gold’s intrinsic worth. Simply explained, depending on the LTV, the value of the gold will either be worth Rs. 10,000 or Rs. 5 lakh. The Reserve Bank of India has fixed the maximum LTV that may typically be obtained on gold at 75%. Accordingly, you can be eligible for a loan equal to up to 75% of the value of your gold, depending on its worth and the rate per gramme.

Knowing the per gramme rate and the LTV ratio is essential in order to comprehend the amount you can receive based on the value of your gold.

The One Rule That Apply To All (Or How To Calculate Gold Loan)

The market rate per gramme, the gold’s purity factor, and the net weight of the metal are multiplied to determine the per-gram gold loan rate. In order to calculate net weight, subtract the weight of the diamond from the overall weight of the jewellery item. For example, the net weight of a diamond ring is the total weight of the ring less the weight of the diamond. After calculating this, the formula is as follows:

Net Weight x Per Gram Rate x Purity = Gold Loan Amount

Once the gold loan per gram has been determined, the LTV is used to determine how much can be borrowed. The LTV ratios on gold are offered by several banks and NBFCs. To acquire the gold loan per gram and get the greatest benefits, it’s important to carefully select the bank or NBFC.

Making a Knowledgeable Choice: Banks or NBFCs

What, then, distinguishes various banks and NBFCs in terms of their gold loan offerings? It’s important to keep in mind that choosing a gold loan with the best rate per gramme isn’t just dependent on the LTV provided by various banks and NBFCs. It is also not based on the straightforward inquiry of how a gold loan is calculated.

The LTV in relation to the interest rate actually determines the maximum profit on your gold loan. When it comes time to repay the loan, a high LTV won’t mean much if you have to pay a hefty interest rate, right?

The interest rate charged by a bank or NBFC should ideally be taken into account in addition to LTV in order to obtain the best gold loan available today per gram. For the greatest deal when taking out a gold loan, it is best to compare higher LTV and lower interest rates.

Enter Ruptok: Ruptok’s offer is about 25% less expensive than the competition as a way to obtain a gold loan for high profit and the best value at the lowest interest rates. especially in light of how much gold costs per gramme today. Ruptok ticks all the right boxes because it provides the highest per-gram rate, boosting profitability. Additionally, unlike other businesses that have a jumping interest rate, Ruptok charges a fixed (non-jumping) rate of interest on your gold loan over a period of time. For any self-employed businessman with business sense, this is unquestionably a steal because it allows for maximum value at minimal interest.

Understanding these fundamental terms and what functions well and poorly when thinking about applying for a gold loan is a wonderful first step towards comprehending the intricate process of gold loan sanctions. Additionally, it makes sense to be aware of all of this in order to clarify gold loan restrictions and prevent fraud, misrepresentation, and undervaluation of any assets you may own.

However, Ruptok provides a very useful online Gold loan eligibility calculator to aid if you still need assistance determining your eligibility.

The Gold Loan Eligibility 101 lesson is now complete. With all of this knowledge in mind, you can make sure that the next gold loan you apply for serves your interests as best as possible.