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Monday, July 22, 2024

Exploring the Loan-to-Value (LTV) Ratio and Its Calculation in Gold Loans

Gold holds incredible value, and especially in India, where average households store a lot of gold as an investment or a gift, it makes much more sense to use it as collateral to get money.

I recently got married, but not even a month later, my mother fell on the floor and was diagnosed with internal bleeding and haemorrhage. The surgery and the other costs were estimated to go over Rs 5 Lakhs, and I did not have that kind of money saved up.

A friend of mine recommended we check out Bajaj Finserv’s gold loan. After checking it out, I saw that the gold we received as a gift during the wedding could help save my mother. So I put the gold up for loan and got the money I needed for the surgery and more.

This is why, if you ever want to get a loan, you should consider getting a gold-secured loan as long as you have some gold.

What are gold loans?

Gold loans are a form of secured loan where you are using gold as collateral to get a loan. This kind of loan is especially famous in India, where even average households possess a lot of gold. This allows people with low credit scores and people who don’t have credit yet to get a loan as it is secured and has lower risk compared to unsecured loans like personal loans.

This allows for easy approvals and lower interest rates than unsecured loans.

What is LTV?

LTV stands for the Loan-to-Value ratio and influences how much money you can get on the gold compared to the market value. RBI usually sets a maximum value, and different lenders choose different ratios to pay out to their customers. RBI has just recently relaxed this sum to 90% of the market value of the gold.

How to get gold loans?

Nowadays, it is effortless to get a loan. All you need to do is to download the app of a trusted gold loan app like Bajaj Finserv.

  1. Go to their homepage and click on loans.
  2. Out of the list of different types of loans, choose gold loans.
  3. Enter the details and see the loan-to-value ratio, total loan amount, total interest rate, and your tenure.
  4. Once you have done that, you will be shared the location of their nearest branch where you can get your gold appraised and valued.
  5. You should get the loan disbursed within 15 minutes of accepting it.

How to use a gold loan calculator?

When considering getting a loan, you should use the calculator to compare the offerings of different lenders and simulate different scenarios to make informed financial decisions.

Although so important, getting and using a gold calculator is very simple. Just go to Bajaj Finserv’s website, and you will find two tabs, one for seeing how much you can get out of your gold and the other to see how much gold will be required to get a specific loan amount. For the first one, you must input the gold’s weight in grams and the repayment period to see the loan amount, total interest payable, and tenure. For the second tab, just select the loan amount, and you will get the weight of the gold required to get to that loan amount, the interest owed, and the tenure.


This is why gold loans are so important and helpful when you need that money for an emergency or an investment, such as for your child’s higher education or your mother’s hospital bills. Gold loan app download help in the process and make it easier, quick, and convenient. I am really grateful that I was able to save my mother’s life by using the shiny yellow rock, and I am thankful to Bajaj Finserv for their help along the way

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