When it comes to taking out a loan, there are a number of different options available. One type of loan that you may not be familiar with is a collateral loan. A collateral loan is a loan that is secured by fine jewelry, a luxury watch, auction quality art, or a classic car, and are a popular strategy among New Yorkers. So, when is a collateral loan the right choice?
There are a number of reasons why a collateral loan could be the right choice when you have a short term liquidity need.
- When you need immediate cash. Unlike traditional bank loans, collateral loans typically fund in 1-3 business days with minimal paperwork. Loan amounts can range from a few thousand to a few million dollars and are primarily based on the secondary market value of the asset(s) being used for collateral.
- When you want to keep your asset. Taking out a collateral loan is an alternative to selling a prized asset to get cash. The lender holds onto your Collateral and returns it to you when the debt is repaid in full.
- When you have a credit history that complicates or disqualifies you from obtaining a traditional bank loan. Collateral lenders don’t care about your credit history and generally don’t even perform credit checks. The key determining factor in obtaining a collateral loan is the value of the asset that you own.
- When faced with unexpected expenses – either challenges or opportunities. We all face unplanned or unexpected expenses from time to time which can put us under financial strain or cause opportunities to be missed if we don’t have sufficient savings set aside to cover them. Whether its a tax bill, margin call, divorce or the opportunity to close on a real estate transaction, short-term cash needs can be easily addressed by luxury asset owners through collateral loans.
- When confidentiality is critical. Collateral loans require virtually no disclosures by the borrower, and are private, confidential transactions with the lender.
Luxury asset owners can benefit from this fast and convenient funding option provided by lenders including New York Loan, using them as collateral to secure their loan. It is an attractive alternative to hastily selling an asset to raise cash. New York Loan is the leading local provider of confidential, non-bank loans that use borrowers’ luxury assets as collateral.