Collateral Loans, the Solution to Unlock Cash When You Need It Fast

Date 17 May 2023

Collateral loans, the answer to all your financial needs. When you find yourself in a situation where you need cash fast, collateral loans can be a saving grace.

But what exactly are they? A collateral loan is a type of loan where the borrower puts up a valuable asset, such as a prestige, vintage, or classic car, fine art, fine wine, gems, jewelry, or even gold, as collateral in exchange for a loan. What makes collateral loans so beneficial is that they are significantly easier to get approved as the loan is solely based on the asset value and often comes with lower interest rates than other forms of lending. This is because lenders are taking less risk by having an asset as security in case the borrower defaults on their loan payments.In addition, collateral loans based on the asset value are often referred to as 'non-recourse finance', which means if the value of the asset drops below the loan and interest due at the end of the term, the lender can not ask the borrower to repay the difference.

Another great benefit of collateral loans is that the amount of the loan is typically higher than with other types of loans. This is because lenders have the assurance of the asset being used as collateral. This allows borrowers to access the cash they need to make big purchases, consolidate debt, or pay for unexpected expenses.

Collateral loans also have the added benefit of not having to worry about your credit score. This is because the collateral is the primary factor in securing the loan, not your creditworthiness. So, if you have poor credit, but a valuable asset, you may still be able to secure a loan.It is important to note, however, that if you fail to repay your loan, the lender has the right to seize the collateral used as security. This could result in the loss of your asset, which is something to consider when taking out a collateral loan.

In conclusion, collateral loans are an excellent way to secure the cash you need quickly and efficiently. With the added benefits of lower interest rates and less strict credit requirements, collateral loans can be a saving grace in times of financial hardship. Just be sure to weigh the pros and cons before committing to one, as your valuable asset may be at stake.

Release My Capital can also help clients borrow against luxury assets and release up to £2 million of equity in their prized belongings, including other assets such as watches, jewellery, fine wine, and art.

Family-run and privately owned, Release My Capital serves a broad range of clients throughout the United Kingdom. We are personable and will always do our best to find the ideal path forward for you.

We are proud members of the National Association of Pawnbrokers.