The gold rate used during the valuation of your gold affects the loan amount you can receive. The rate applicable at the time of assessment is considered rather than the price you paid when you bought the gold.
If the applicable gold rate is higher, the assessed value of the same gold will be higher. If the rate is lower, the assessed value will be lower.
What decides your eligible loan amount?
Gold loan eligibility depends on:
- How much your gold weighs
- How pure it is
- Applicable gold price
- The Loan-to-Value (LTV) ratio
Stones, enamel, or any decoration on your jewellery do not count towards your loan value. Only the actual gold content is assessed.
Lenders also do not simply use today's headline rate. They use whichever is lower between the previous day's closing price or the 30-day average closing price published by IBJA or a SEBI-regulated commodity exchange. This protects you from a sudden price spike inflating things unrealistically and protects the lender from the opposite.
Please note, the maximum LTV eligible for a loan depends on the loan amount and cannot be more than the limits given. To know more, click here.
Gold loan basics: What you should know before applying
If you are planning to apply for a gold loan, check the loan amount, gold valuation, interest rate and repayment terms before applying.
With Bajaj Finance, you can borrow from Rs. 5,000 up to Rs. 2 crore against eligible gold jewellery, ornaments and coins. The gold loan interest rate starts from 9.50% per annum. Jewellery and ornaments between 18-22 karat purity are accepted, while gold coins up to 24 karat purity may be eligible. Pledged gold is stored securely and covered by insurance during the loan tenure, subject to applicable terms.
Before applying, keep these points in mind:
- Your eligible loan amount depends on the weight and purity of your gold, its assessed value and the applicable Loan-to-Value (LTV) limit.
- Bajaj Finance values eligible gold using the lower of the previous day's closing price or the preceding 30-day average closing price for the relevant purity, as published by the India Bullion and Jewellers Association (IBJA) or a SEBI-regulated commodity exchange.
- You need one valid KYC document, such as an Aadhaar card, Voter ID, passport, driving licence, NREGA job card or a letter issued under the National Population Register.
- The repayment structure depends on the option you choose. Under bullet repayment, the principal and interest are settled at maturity. With regular repayment, interest is paid half-yearly and the principal is paid at maturity.
- No foreclosure charges apply when you close the loan early.
Before applying, use the gold loan calculator to estimate your eligible amount, or gold loan eligibility online to understand your borrowing capacity based on today's gold rate in Aurangabad, gold purity, and weight.
Ready to unlock the value of your gold? Apply for Bajaj Finance Gold Loan today.
