3 Benefits Of Getting A Jewelry Collateral Loan

If you find yourself in need of some quick cash, you may be thinking of taking out a small loan. But short term loans sometimes have high interest rates and if you have already tapped out your existing lines of credit, you might not qualify anyway. One option to get yourself back on the right track that you might not have considered is a jewelry collateral loan. A jewelry collateral loan will give you an amount roughly equal to the value of whatever jewelry you turn in to the jewelry shop. Here are 3 reasons why this might be a good choice for you.

It's Not the Same as Selling - You Get Your Jewelry Back

If you know you have some jewelry that is worth a decent amount of money, but you don't want to part with it because of sentimental value, a collateral loan could be just the ticket. You only turn the jewlery over to the jewelry shop permanently if you fail to pay back the entire loan. The jewelry becomes collateral in the same way that your car is while you are making payments to the dealership. It simply protects the person who gave out the loan in case you don't pay them back. 

No Credit Check

If you have tried to get a small loan elsewhere and have been turned down due to bad credit, a jewelry collateral loan could be beneficial because there is usually no credit check involved. Yes, the jewelry shop owner would generally like you to pay back your loan in full, but they will not be as concerned about making sure you have a good credit history because even if you don't come through, they know they will get the jewelry to compensate them.

Lower Interest Rates

The rates on some credit cards or payday loans can be ridiculously high. While the exact percentage of the interest rate on a jewelry backed collateral loan will vary, there are usually caps put in place in order to keep the interest rate reasonable. The exact amount of this cap will vary state by state. Check with a local jewelry shop that provides loans in your area to find out what is applicable in your state. Chances are, it will be a much less expensive option than taking out a payday loan.

If you need a quick infusion of cash, but don't have many options to get it, a jewelry collateral loan could be what you need. Such a loan allows you to keep your jewelry assuming you pay back the loan in full, it's possible to get a loan without a credit check because of the collateral involved and you will likely save some money on interest rates when compared with other short term options like payday loans. To find out more, speak with someone like Sol's jewelry & Loan.