Gold Rate Today: Real-Time Analysis for Gold Loan Seekers

Gold has always been considered a precious commodity for us Indians as it symbolises prosperity, wealth, and good health. Since India is one of the largest gold markets, it also plays a significant role in the Indian economy. People use gold as an investment and ornamental commodity.

Table of Content:

• What is the Gold Rate?
• How does a Gold Loan Work?
• Why is it the Best Time to Take a Gold Loan?

Moreover, during times of emergencies, instead of selling off the gold, people take advantage of gold loans by exchanging their gold as collateral for money.

What is the Gold Rate?

Gold rate is the price of the gold per gram on the current day or the rate at which it is traded in the gold market. This rate keeps fluctuating according to market conditions, demand and supply, geopolitical factors, and more. Therefore, it is important to note that the gold rate today might differ from the rate yesterday and tomorrow.

How does a Gold Loan Work?

Gold loan is a secured loan and its process is quite similar to that of other secured loans. The gold is evaluated by the lender and the borrower gets a gold loan according to the per gram of gold on that day. Check out the following points to understand how gold loans work:

Valuation

Before getting the loan amount, the lender will estimate the pledged gold's weight and purity. The gold loan amount is determined by the gold rate today (current day), i.e., the market value of the gold. Borrowers should consider the loan-to-value ratio in which the lender offers a certain percentage of the market value of the gold as a loan. Once the lender and the borrower agree upon the valuation, the gold loan is sanctioned. The entire process takes just a few hours, making the loan ideal for emergencies.

Use the gold loan calculator

The gold loan calculator is an important tool for borrowers that helps them estimate the loan amount they can get based on their gold's weight and purity. It can also help get an idea of how much gold one has to pledge for their requested loan amount. By using a calculator, borrowers can compare different lenders before making their final decision.

Interest rates and tenure

The interest rate provided on the gold loan can vary based on the purity of the gold. With a higher purity of gold, one can avail higher loan amount and competitive interest rates. Additionally, the loan tenure can range from 7 days to 12 months, depending on the borrower's requirements.

Repayment

The repayment terms can also vary from lender to lender. Many loan providers pre and part-repayment facilities that the borrower can choose from depending on their financial situation. How does the Gold Rate Impact Your Gold Loan?

The gold rate today can have a significant impact on your gold loan. While applying for a gold loan, the loan amount can be affected by the gold rate today for 1gram, gold's purity and weight. Any fluctuations in the market value of gold can have an impact on your loan amount since it affects the loan-to-value ratio.

For instance, if the gold rate today for your pledged gold is INR 1 lakh, then the maximum loan amount as per the LTV ratio (75%*) will be 75,000. But if the gold rate increases to 1.10 lakhs, then the loan amount will increase to INR 82,500.

Suggested Read: How does the Gold Loan Process Work?

Why is it the Best Time to Take a Gold Loan?

Today, the increasing gold rates for 1gram allow borrowers to get better principal amounts while applying for a gold loan. The hike in gold prices can be beneficial for borrowers because the higher the gold prices, the better value one can get from their collateral.

Higher gold prices allow borrowers to take alargeramount against the same gold ornaments.Additionally, when lenders offer competitivegold loan interest rates, it becomes an appealing financing option. Again, the rising gold prices encourage lenders to offer lower interest rates.

The safe and hassle-free process of gold loans is incomparable to other types of loans. And lastly, borrowers have the option to repay the loan amount on a flexible tenure.

This indicates the importance of gold rates while taking a gold loan. The increase in the gold rate per gram is enabling gold loan borrowers to tap into the possibility of taking financial assistance from the top banks and NBFCs. With reputed loan providers like Muthoot Finance, borrowers can avail high LTV ratio on their gold and attractive interest rates on their gold loan.