How Much Loan Can You Get on Your Gold?
The sum you can borrow against your gold jewelry is determined by multiple important elements. Grasping these elements can assist you in optimizing your borrowing capacity.
Primary Elements Influencing Loan Sum
- Gold quality (karat rating)
- Mass of gold
- Present market price
- RBI LTV (Loan to Value) regulations
Method of Loan Sum Determination
The borrowing amount is determined as a portion of your gold's market worth, referred to as the Loan to Value (LTV) percentage. RBI rules generally permit up to 75% of the gold's worth as the loan sum for NBFCs.
Illustrative Computation
Consider 22K gold with a weight of 50 grams:
- Present market worth per gram: ₹6,000
- Overall worth: 50 × 6,000 = ₹3,00,000
- LTV percentage: 75%
- Loan qualification: ₹3,00,000 × 0.75 = ₹2,25,000
Elements That May Influence LTV Percentage
- Gold quality: Superior quality (24K) might qualify for improved LTV
- Borrower profile: Strong credit record may enable higher LTV
- Lender guidelines: Various NBFCs might offer different LTV percentages
Strategies to Enhance Loan Sum
- Polish your jewelry for precise weight assessment
- Select higher quality gold when feasible
- Exclude gem weight from gold weight
- Select a trustworthy lender offering favorable LTV percentages
Keep in mind, the ultimate loan sum could differ depending on the lender's evaluation and prevailing market circumstances.
