With the cost of living outpacing earnings, it is inevitable people may need extra cash every once in awhile. Whether you had an unexpected expense pop up or just require a few extra dollars to tide you over until your next payday, here are two reasons taking out a collateral loan using a piece of valuable jewelry you own may be a good choice.
Even Broken Jewelry Can Net Cash
People who consider this type of loan assume only jewelry that is wearable and in one piece can be used as collateral. That's not true. You can get a loan on broken, tangled, or otherwise damaged pieces. Even if the piece can't be sold to the public as is, it will typically contain elements that are valuable for other reasons. For example, a company may still loan you money on a broken gold ring because gold is in high demand at the moment. The piece can be melted down and reused for other things.
Be aware, though, the amount of money you can get may still be influenced by the piece's condition. Damaged jewelry can only be sold to a limited number of buyers or may require some work to extract the valuable parts (e.g. remove diamonds from a broken necklace), so the maximum amount of money you can borrow may reflect that.
Lower Interest Rates and Fees
Companies that do loans on jewelry charge interest and/or fees, which is how they make their money on that financial product. However, they will generally charge less for loans backed by collateral. This is because if you default on the loan, the company can still recoup its money by selling your jewelry. Since the risk of losing money is lower and the need to pay for expensive debt collection methods is eliminated, the lender can afford to pass on some of that savings to their customers.
This means you will pay a lot less for the money than you would if you got cash from a payday lender that offers unsecured loans. However, like any type of loan, it is still prudent to shop for the best deal. Call around to different lenders to see who charges the lowest rate or has the best benefits that fit your need and budget.
For more information about taking out a jewelry loans or to get some cash fast, contact a lender in your area.
Share18 May 2017
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