It doesn’t matter how well you plan your finances or how well you control your expenses, there is always a chance of reaching that stage of life where you might need some quick cash. Well, in such cases, borrowing from friends or selling something might add more burden to the current situation and that’s why most people like to go with loans.
But when we say loan then we don’t mean the personal loans as getting personal loans approved is itself a challenge. Here, we are talking about the most seamless form of loan in the form of collateral loans on luxury jewelry.
If you have luxury jewelry sitting idle in your house then you can use it to get some quick cash and that too without losing possession of your jewelry. This is what is a collateral loan on luxury jewelry is all about.
To make things easier to understand, we will discuss all that you need to know about collateral loans on luxury jewelry in a detailed manner.
Table of Contents
How does a collateral loan work?
In a collateral loan, you as a client are offered an appraisal amount for any type of luxury jewelry that you have brought in for assessment. One of the experts then appraises the piece of jewelry and then decides on the loan amount your jewelry deserves.
After that, the final amount of loan that can be offered by the lender is decided. In this case, the loan appraisal isn’t going to cost you even a single penny and you are not obliged to enter into a loan contract even after approving the loan amount. So, instead of deciding to sell jewelry in Kansas city, you can always decide to get a loan by using the jewelry as collateral.
After you approve the loan amount, the terms and conditions of the loan are explained both verbally and in writing by the lender. If you are comfortable with the terms and conditions, you can simply sign the contract and get the decided cash immediately.
Which type of jewelry can be used as collateral?
There is a long list of items on which a collateral loan can be approved. Some of those items are;
- Estate jewelry pieces
- Gold and precious stone bracelets
- Diamond wedding rings
- Fine jewelry necklaces, and much more
The lender is always ready to grant a loan on any type of jewelry item until the jewelry is legit and has original stones, gold, or silver.
How the loan amount is determined?
Along with the item itself, there are various other factors that are considered for deciding on the loan amount. It always takes an experienced and skilled jewelry expert to determine the actual value of gold, silver, or diamond jewelry items. If you are getting the right price in the form of a loan for your jewelry item then there is no need to sell jewelry Kansas City.
Most of the staff members hired by the lenders are GIA certified. The Gemological Institute of America is a globally recognized authority and certification from this body is globally recognized. Any person having certification of GIA has the right method and practices for analyzing even the 4c of a diamond.
What is the current interest rate of collateral loans in the case of luxury jewelry?
There is no fixed interest rate when it comes to collateral loans since different lenders have their own method to come up with the loan amount and interest rate. This is why what is offered by one lender might be different from another.
And since there is no use of parameters like a credit score for determining the interest rate, it can vary in every case. But you can always be sure that you are getting less interest rate in comparison to personal loans
Lenders are ready to offer you less interest rate than personal loans since the risk involved in the case of a personal loan is higher than that of a collateral loan. Lenders always have the jewelry in the form of collateral and therefore, they don’t need to look at the level of risk involved and your ability to repay the loan.
What if you fail to pay the loan?
If you are not able to repay the loan within the decided time frame then you can ask for an extension and if you still fail to repay the loan after extension then you will lose possession of the jewelry and it will be used by the lender for recovering the loan amount.
Instead of directly selling jewelry, you should always look for other effective options like collateral loans. With such options, you neither lose possession of your jewelry nor do you miss to fulfill your quick cash needs.