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| March 6, 2024

Know About The Gold Rate Today for Gold Loan Per Gram

Before you avail a gold loan, one of the most crucial factors to consider is the per gram rate of gold. This rate determines the value you receive for each gram of gold you pledge as collateral. However, the per gram rate is influenced by various factors which makes it essential to understand the dynamics involved. This blog is a complete guide to gold loan per gram rate that will help you with the knowledge to make informed decisions.

The Importance of Gold Rates

Gold has long been regarded as a valuable commodity and its value fluctuates based on market conditions. When you avail a gold loan, the lender assesses the current market rate of gold to determine the loan amount they can offer you. It's a known fact that when the market value of gold rises, the loan amount one can acquire against a specific quantity of gold decreases. Conversely, when the price of gold decreases, the loan amount you can secure against the same quantity increases.

Eligibility for Gold Loans

Before understanding the factors affecting gold loan per gram rates, it's essential to understand the eligibility criteria. Most lenders require borrowers to be at least 18 years old and provide valid identification documents like a PAN card or Aadhaar card. Additionally, the gold ornaments or jewelry pledged as collateral must meet specific purity standards set by the lender. You can check your eligibility of availing a gold loan by using a gold loan eligibility calculator.

Factors Affecting Gold Loan Per Gram Rate

The per gram rate of gold is influenced by several factors and understanding them can help you make informed decisions when availing a gold loan.

  • Purity of Gold Ornaments: The purity of the gold ornaments you pledge is a crucial factor in determining the per gram rate. The purer the gold, the higher its value, and consequently, the higher the per gram rate. For instance, 22-karat gold ornaments have a higher value and per gram rate compared to 18-karat or 20-karat pieces.
  • Average Market Price of Gold: The average market price of gold for a particular purity level is another significant determinant of the per gram rate. Lenders closely monitor the daily fluctuations in gold prices and adjust their gold loan per gram rates accordingly. When the market price of gold rises, the per gram rate typically increases, and vice versa.
  • Location and Demand: The per gram rate of gold can vary across different states and cities due to factors such as local demand, taxes, and transportation costs. Areas with higher demand for gold may have slightly higher per gram rates compared to regions with lower demand.

Calculating Gold Loan Per Gram Rate

It is a very simple process to calculate the gold loan amount using the per gram rate. Let's understand with an example: -

Suppose you have 10 grams of 22-karat gold and today’s per gram gold rate for 22-karat gold is INR 4,000. The total market value of your gold ornaments would be 10 grams × INR 4,000 = INR 40,000. So, INR 40,000 is your gold rate today as per your 10 gm gold.

Most lenders offer loans using an LTV ratio that allows loans up to 75% of the total market value which means you could potentially borrow up to INR 30,000 (75% of INR 40,000) against your gold ornaments.

To simplify the process, many lenders provide online calculators that allow you to input the weight of your gold and the calculator will automatically calculate the loan amount you can avail of based on the current per gram rate. Please note that these calculators only provide an indicative value of the loan amount you can borrow. For exact details, it is recommended to contact the lender.

Choosing the Right Lender

When you avail a gold loan, it is important to choose the right lender. Reputable lenders, such as Muthoot Finance, offer competitive per gram rates for gold loans and ensure you receive a fair value for your gold. Muthoot Finance recognized as India's Most Trusted Financial Services brand uses a transparent process to determine the per gram rate by considering the current market price of gold and the purity of your ornaments.

Benefits of Muthoot Finance's Gold Loan Services

  • Competitive Per Gram Rates: Muthoot Finance offers among the best per gram rates for gold loans. This ensures you receive a higher loan amount against your pledged gold.
  • Transparency: The lender adheres to a transparent process and clearly outlines the factors considered in determining the per gram rate and loan amount.
  • Convenience: Muthoot Finance is quite convenient and accessible in terms of gold loans with a nationwide network of branches. One can also avail gold loans from the comfort of their home with Loan@Home, a doorstep gold loan facility provided by Muthoot Finance.
  • Expertise: With decades of experience in the industry, Muthoot Finance has a deep understanding of the gold loan market and ensures you receive reliable services.

To make the most informed decisions regarding gold loans, it's essential to stay updated on the current market rates of gold. Reputable lenders like Muthoot Finance provide up-to-date information on gold rates which allows you to monitor fluctuations and plan accordingly. You can also consult online resources or financial news outlets for real-time updates on gold prices.

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