Things you didn’t know about calculating gold loan interest

Gold loans can be the right product to obtain a sizable fund by pledging high-quality gold ornaments and jewellery as collateral. 

Nevertheless, it is crucial to calculate the interest rate for a gold loan. One can use a gold loan interest calculator for the same. 

5 things to know while calculating gold loan interest rates

1. Gold loan amount 

Determining the loan amount allows applicants to know the interest rate and how much gold to pledge to obtain the required fund. 

2. Interest type

While calculating interest rates, one must also know the type of rate he or she is opting for. Generally, lenders offer gold loans at compound interest, jumping interest, penal interest or EMI. 

3. Loan repayment tenor 

The loan tenor specifies the maximum period within which an applicant has to repay the obligations. In this context, applicants should choose the tenor wisely and as per their financial capacity. 

4. Financial institution 

Gold loan interest rates are significantly affected by the additional fees that a financial institution charges. Hence, applicants should enquire about these charges before applying for credit. 

5. Loan calculators

Using a jewellery loan interest calculator allows borrowers to choose the best interest rates per their requirements. 

Hence, individuals opting for a gold loan in Indore or any other city should keep these factors in mind while calculating gold loan interest rates.