InvestorQ : How much loan can I avail against my gold holdings and in what form can I pledge gold?
Anjana Aiyar made post

How much loan can I avail against my gold holdings and in what form can I pledge gold?

Answer
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Arya Nanda answered.
1 year ago


You can hold gold as jewellery, although the valuation expert will make appropriate value adjustments. How much of loan can you get? That will depend on the value of the gold. The bank or financer will consider the equivalent of 22 carat gold. So if your gold is of lower carat then proportionately the quantity will be reduced. Normally banks will give you loan to the extent of 70% to 75%of the market value of the assessed quantity of the gold and this is popularly referred to as the Loan to Value (LTV) ratio. Gold loan providers do not insist on any income documents except your basic PAN card and Aadhar card. What is the price considered? It varies. Some consider the daily price of gold while some consider the weekly or fortnightly average gold price to get a clearer picture. The loan is secured by the gold which is physically pledged to a bank. You need to give the gold physically to the bank or financer and the safe keeping of the gold is then their responsibility.