Use An Online EMI Calculator To Plan Your Gold Loan Better

There are very few of us who have not faced a financial crunch at some time or the other. In these uncertain times, when several tech companies and start-ups from Amazon to Meesho have begun downsizing, it is very likely that many of us are likely to face one in the future. Even those of us with regular, secure jobs, are not immune from financial emergencies. Often times, our regular income and savings are not enough to take care of a host of unexpected expenses and contingencies such as medical illness or educational expenses.

At such times one can consider the option of a gold loan to finance such expenditure. A gold loan is a loan given by a lender against physical or digital gold. One needs to deposit the gold with the lender who will evaluate its worth and offer you a loan based on the physical weight and purity of gold deposited. Many institutions offer online gold loans as well. All one needs to do is to log on to the website and provide the required details. The institution will send a representative to your doorstep to evaluate and collect the gold, after which the loan amount is deposited into your account.

However, the financially prudent will always find it best to do a little research in order to decide which institution is offering the most viable terms and conditions against the loan. Today several websites offer handy tools that help the borrower make an intelligent comparison before zeroing on the lender of their choice. An EMI calculator along with an online gold loan calculator are the ideal tools to help you plan your gold loan better.

It is imperative that you understand the loan and payment terms of the lender beforehand. It is equally imperative to compare the loan amount offered and payment terms and conditions offered by various lenders. Once you have a clear picture of the terms and conditions you need to commit to in order to avail a loan against gold, you can use the help of an EMI calculator, an online gold loan calculator or a gold loan EMI calculator to help you decide which lender and lending option is the best for you.

Here we explain in detail how to use the tools available online to help you decide on the amount of gold you need to pledge and the EMI payable.

Calculate The Amount Of Gold To Be Pledged:

Once you are clear on the loan amount you need, you could use an Online Gold Loan Calculator provided by companies such as IIFL to help you understand the amount of gold you need to pledge. Some sites may ask you for more details such as the weight of gold you want to pledge and the purity or number of karats before calculating the loan amount they will offer. You can keep tweaking the amount gold to be pledged in order to arrive at the loan amount required. Currently RBI allows lenders to offer loans up to 75% of the gold value, though most lenders prefer to offer a lower percentage of value in order to protect themselves from price volatility.

Calculate Your Monthly Spare Income Available To Service The Loan:

It will be in your best interest to understand how much spare income is available to service the loan. You can do this by calculating the difference between your monthly regular and fixed expenditure against your income. It is best not to commit the entire amount to the EMI but keep a small buffer for contingencies.

Calculate The Loan Tenure:

Having understood the loan you can avail, you need to understand the Loan Tenure. This will depend on the interest rate offered and the monthly EMI you are in a position to pay. Most lenders will have a cap on the repayment tenure. You could use either a gold loan EMI calculator or any online EMI calculator to help you with this. Put in the loan amount, interest rate, and enter a random tenure to understand the monthly EMI payable. Now keep increasing or decreasing the tenure till you arrive at the EMI which you are comfortable with app.

Using the online tools available it is easy to plan the gold loan repayment and get a clear picture of the interest you will be paying. It is always advisable to be financially prudent and take a loan as per your needs even if the amount of gold that you have allows you to get a much bigger loan. Equally important is for you to make a realistic estimate of the EMI you can pay every month. Do visit the IIFL website and check out the online gold loan facility offered by us.