For years, gold has always had a special place in the hearts of Indians. It is a symbol of wealth, prosperity, and security. However, if you look beyond its aesthetic appeal and intrinsic value, it serves as collateral for obtaining a loan. Nowadays, gold loan interest rate calculator is a tool that is a must use before opting for this loan!
This type of loan serves various purposes, such as meeting short-term liquidity needs and funding business or education expenses. In addition, they definitely provide individuals with a convenient and accessible option to leverage the value of their gold assets without having to sell them upfront.
What is a gold loan?
As the term suggests, it is a type of secured loan where gold jewellery or ornaments are pledged by the potential borrower as collateral in exchange for funds provided by a lender.
The potential borrower approaches a financial institution, such as a bank or a non-banking financial company (NBFC), with their gold jewellery or ornaments. Further, the lender assesses the value of the gold based on its purity and current market rates and determines the loan amount that can be provided.
Once both parties agree upon the amount of the loan, the borrower offers the gold as collateral to the lender, who keeps it in safe custody throughout the tenure. If the right platform is chosen, the borrower receives the amount directly into the bank account within a few minutes or hours.
Keep in mind that the loan is repaid within a specified period, ranging from a few months to a few years.
What is a gold loan calculator?
It is a simple tool that helps the borrowers estimate the amount of loan they can easily avail against their gold assets and calculate the approximate repayment amounts. This tool was designed to give potential borrowers an idea of the loan terms and conditions before approaching the lender.
How to Choose the Best Gold Loan Calculators App for Your Needs?
1. Research
Start by researching and identifying gold loan app available on various platforms. As the most preferred medium is a mobile application, look for applications with positive reviews and high ratings from users.
2. Reliability and accuracy
These two are the most crucial factors when it comes to loan calculators. So, search for applications that are famous for providing accurate results and have quite a good reputation for reliability.
3. User-friendly interface
This is essential for ease of use. In addition, a clean and interactive interface makes it easy for the users to input the required details and obtain accurate results.
4. Security and Privacy
Since it is obvious that you may need to enter personal and financial information into the application, it is essential to prioritize security and privacy. So go for applications such as Bajaj Finserv that have robust security measures in place, such as data encryption and secure storage of user information.
5. Comprehensive features
There are many companies, such as Muthoot, IIFL, Bajaj Finserv etc., that offer this tool. Personally speaking, I used the one provided by Bajaj Finserv, and it has quite a lot of features. However, remember that the application you choose should offer the ability to calculate the amount of loan based on the weight of the gold, its purity, and the prevailing market rates.
Conclusion
Using a Gold Loan Eligibility Calculator is one of the wisest decisions you can make before opting for this type of loan. It clearly gives you a brief idea about your investment and how every aspect of it will work!
