Gold, especially in India, is one of the most popular investment options in the world. This yellow metal is kept in almost every Indian household as a prosperity and auspicious sign. As a result, the collateralisation of these metals to obtain funding makes it easier for most people in the country to borrow money, which in turn helps popularise gold-backed loans.
However, taking out a loan against gold in any amount without a solid repayment plan could stress a borrower’s budget and even lead to loan default. Using an EMI calculator for gold loans can benefit prospective borrowers. To explore and understand the uses of gold loan calculators, check out this article below.
Understanding Gold Loan
A gold loan is a secured loan taken out by borrowers to meet their immediate or long-term cash needs against gold. The lenders will usually grant you a loan in an amount that corresponds to the intrinsic value of the gold. After you have paid back the gold items on an instalment basis, they can be returned. The borrower guarantees the gold jewellery as security in that case.
According to the Reserve Bank of India, the loan amount permitted upto 75% to the existing market value of gold. The carat weight of the gold that can be pledged ranges from 22 to 24. So, whether you’re getting married, going on a family vacation or attending your child’s school, this is an excellent option to meet your urgent financial needs. Many public and private banks, as well as NBFCs, offer gold loans at reduced interest rates. Moreover, in today’s digital era, you can get gold loan at home through various online instant loan apps like IIFL Finance.
What is a Gold Loan Calculator?
A gold loan EMI calculator is an online tool that allows individuals to determine the monthly payments they must make against the loan amount. This online tool will enable users to obtain a separate breakdown of their total interest outgo and principal repayments. The task of an interest calculator is also carried out in this respect by an online EMI calculator. The user needs to enter the required amount of the loan, the appropriate duration and the interest rate.
How to Use a Gold Loan Calculator?
It is effortless to use a gold loan calculator. An online EMI calculator is available on the official websites of almost all credit providers. To use this tool, individuals must first visit the Gold Loan Calculator page. Depending on the information requested, they may continue in one of these two ways.
To know the required gold.
Step 1: On the calculator page, click on the option to select the required loan amount.
Step 2: Specify your loan amount and select the appropriate interest rate and term. After that, the calculator will supply the required gold content, total interest to be paid, and monthly interest.
Knowing the amount needed for a loan.
Step 1: Choose the available gold weight by clicking on it.
Step 2: Enter the total weight of the gold in grams and its purity in Karats.
Step 3: Set an appropriate interest rate and duration.
After this process has been completed, the overall amount of money that can be obtained for your collateral, interest on each month, and entire interest will be displayed to you via an online calculator. Individuals may also apply for a corresponding amount immediately if they are satisfied with the results of their calculator in line with their conditions.
Advantages of Using a Gold Loan Calculator
The various benefits of using a gold loan calculator are mentioned below.
User-friendly
This online tool is easy to use and can be used. To obtain the desired results quickly, interest seekers only need to enter specific loan details, such as total principal amount, interest rate, and term.
Effective financial management
In particular, an online calculator helps potential borrowers estimate their loan instalments and plan accordingly for repayment. As a result, there is a decreased possibility of loan default and better financial management.
Speedy results
It can take a lot of time to calculate EMIs manually using the mathematical formula. On the other hand, an online EMI calculator provides instantaneous results, saving users time and energy.
Accurate calculations
Errors, not to mention time-consuming, can complicate manual calculations. Precise calculations are needed for major financial decisions, such as a gold loan. This process is facilitated by the online gold loan EMI calculator, which allows users to view accurate results for every value entered.
Conclusion
The gold loan EMI calculator is available on each lender’s website to help them calculate the amount of the EMI they will pay when they take out the gold loan. This tool is highly efficient as it lessens the borrowers’ efforts and gives them a realistic estimate of the monthly instalment amount they must pay. To obtain the exact amount of interest payments borrowers must pay to repay their loan, the Gold Loan EMI Calculator is a very effective tool that can be used more than once.
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