The best way to unlock the value of luxury assets is to sell them or pledge them as security for a short-term collateral loan. Each avenue comes with its advantages. But how does one determine which one is best for their financial needs? There are several factors to consider, which we have compiled in a straightforward guide. Read on to learn more about selling vs. borrowing luxury assets.
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Understanding Collateral Loans
Collateral loans, also known as asset-backed loans, differ from traditional bank loans, which take days to complete and require credit checks and tedious paperwork. Instead, they are short-term loans that use valuable assets, such as designer handbags, high-end watches, diamond jewelry, precious metals, and even loose gemstones, as security in exchange for cash. Additionally, bank loans can take a week or more to process before the funds are transferred, while Qollateral’s customers can walk out of our office with cash in hand the same day, no questions asked. It’s a very attractive option for anyone searching for a reliable and discreet solution to their short-term liquidity needs.
Qollateral has refined the lending process to make it as straightforward and secure as possible. It starts by making an appointment for an online or in-person valuation, during which our team of appraisers will determine the liquid wholesale value of the assets being promised as security for the loan. If the customer accepts the loan terms, the assets will be entered into the care of Qollateral, where they will be stored in a monitored vault until the loan and interest are paid in full.
Advantages of Selling Assets
A common alternative to securing a short-term loan is selling assets to a trustworthy buyer for a fair and competitive price, such as Qollateral. This option is particularly attractive for anyone who has no sentimental attachment to the asset and needs immediate access to funds. There’s also the advantage of not worrying about loan payments and eliminating the risk of accruing debt or interest. Owners can also simplify their lives by selling off high-value assets that would otherwise require safe storage or expensive insurance to protect.
Quick Cash on Demand
No Loan Repayments
No More Safe Storage/Insurance
Advantages of Borrowing Against Assets
One of the biggest benefits of a collateral loan instead of selling assets is that the borrower will retain ownership throughout the loan terms. The item may be a family heirloom, such as a Tiffany diamond ring. In that case, they can use it to solve their temporary financial needs while keeping it in the family and benefiting from any potential appreciation through the years. What’s more, funding can be processed as quickly as the same day if necessary. As mentioned, collateral loans don’t require credit checks or tedious financial reviews. They can be kept completely confidential between the asset owner and the lender. The advantages of a collateral loan include:
Quick Cash
Retain Ownership
Short-Term Financial Solution
Potential for Appreciation
No Credit Checks
100% Confidential
Factors to Consider When Considering Between Selling and a Collateral Loan
Deciding how to monetize valuable assets is a big decision. Below are a few factors to consider:
Financial Needs and Goals: What do you need the influx of cash flow for? How do you want your assets to serve you in the future? For example, time might be a factor for some who face an unexpected expense or investment opportunity. In that case, selling is often a quicker option.
Market Value and Trends: How an asset performs on the secondary market can significantly impact whether someone chooses to sell or loan against it. If the item is expected to appreciate soon, retaining ownership rather than selling might be worth it.
Loan Terms: The cost of borrowing against assets might be more beneficial than the potential gains from selling it and vice versa. That’s why it’s worth studying market value and trends before deciding whether to secure a loan or sell.
The decision of borrowing against assets or selling ultimately comes down to a person’s financial needs and how important the asset is to them. Make an informed decision by following the points covered in this guide, or contact the Qollateral team for a free, no-obligation quote. We can help you find capital when you need it by helping you sell or loan against a wide variety of high-end assets as soon as today.
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