Ukraine and Russia’s war has led to turmoil in the world economy. The stock markets are plunging, crude oil prices are soaring, and gold prices have steadily increased over the past few months.
In 2022, the MCX gold rate increased by 11.70%. When gold prices are up, the amount available for people to borrow increases, thus increasing the gold loan interest rate.
On the contrary, when gold prices are down, people can borrow less, thus reducing the interest rate on the gold loan. Gold prices and gold loan interest rates are two critical factors that can be evaluated before taking a gold loan. A gold loan is a secured loan taken against gold, and it is a convenient option for people who need quick capital.
However, it is hard to estimate how much the gold loan interest rate will rise/fall because several other factors go into calculating the gold loan interest rate.
Factors Affecting Gold Loan Interest Rate
Some of the factors affecting the gold loan interest are:
1. Amount of Loan Required by the Borrower
One of the main factors affecting the current gold loan interest rates is the borrower’s loan amount. Lenders evaluate the weight and purity of the gold, and then the loan amount is set.
The lender will base the interest rate on the amount needed by the individual; if the loan is for a larger amount, the interest rate will be higher, but if it is for a smaller amount, the interest rate will be lower.
With Muthoot FinCorp, individuals can get a gold loan of up to 75% of the value of the gold that they provide them.
2. Location of the Borrower
The current interest rate on a gold loan can depend on many factors, including the borrower’s location, i.e., metro towns, small towns, etc.
With Muthoot FinCorp, you can get a loan based on your region’s current gold loan interest rate.
3. External Factors
External factors such as global interest rates and inflation can influence the current interest rates of a gold loan.
If inflation rises, the RBI will increase the interest rate, which will thus increase the current gold loan interest rate.
If the interest rate increases globally, the gold loan interest rate will also increase.
How to Find the Current Gold Loan Interest Rate?
To find the current gold loan interest rate, individuals can use the gold loan interest rate calculator.
The gold loan interest rate calculator helps individuals determine the current gold loan interest rate and the approximate monthly payments(EMI) on their gold loan.
The Muthoot gold loan interest rate calculator helps choose the best loan for their budget.
The steps to calculate the interest rate on this calculator are:
- Visit the Muthoot FinCorp website, and click on the gold loan & then the gold loan calculator.
- In the calculator, you can fill in the amount of money you need or the amount of gold you want to pledge (in grams).
- Once you input the data, a list of schemes will appear, each with a different interest rate and loan tenure. Clicking on any of the schemes will give you more information about it.
If individuals know the current gold loan interest rate and the tenure of the loan, they will be able to make an informed decision and select a gold scheme that fits their budget.
Knowing the current gold loan interest rate is essential to everyone, from individuals looking to finance a wedding or education to large businesses financing an expansion.
This is because the current gold loan interest rate is used as the starting point for gold loan agreements.
One of the critical factors in taking out a gold loan is the interest rate. The current gold loan interest rate will depend on the size of the loan, the underlying collateral, the location of the borrower, and the duration of the loan.
If the interest rates are high, your monthly payments will also be increased. Conversely, your monthly payments will also be lower if the interest rates are lower. The lender may even sell off your gold if you miss a payment, so it is essential to carefully evaluate the interest rate before taking out a gold loan.
If you are looking for the current gold loan interest rate, Muthoot FinCorp is the way to go. Getting a gold loan with them is easy and hassle-free because they quickly approve loans with minimal documentation.