Avoid These Three Potentially Costly Online Coin Buying Mistakes
Online coin auctions, such as eBay, offer coin collectors a wide variety of coin options at exceptional prices. In fact, coins can oftentimes be purchased for prices that are well below retail value; however, online coin buying can also be fraught with potential perils. Most online coin dealers are reputable and transparent firms that offer full disclosure on the condition of coins. However, some newer, inexperienced and less than reputable online coin dealers will attempt to mask condition issues or embellish the condition in hopes of realizing the full value for less than prime coins. In this article, we’ll highlight three common issues that we’ve seen over the years in hopes that coin collectors will avoid these pitfalls and improve their chances of receiving a coin that meets their expectations.
Cleaned CoinsThe cleaning of coins is a common issue in the coin industry, and seems to be more prevalent with online auctions. While on the surface, a clean and shiny coin appears to be one that would be in high demand, that’s not the case, as coin collectors and numismatists prefer coins in their original condition. In fact, cleaned coins, which are considered altered coins, are worth substantially less than unaltered coins. Cleaned coins can be identified by their shiny appearance or their tone-free appearance, when in circulated condition. This differs from uncirculated coins that have somewhat of a frosty or milky appearance, which is referred to as mint luster.
Rim IssuesImages of coins usually accompany online auctions, but when posted, they’re typically only of the front (obverse) or reverse side of the coin, leaving individuals to guess as to the condition of the rim or edge of the coin. Since many coins that are now being sold as rare or numismatic coins were at one time used as currency, it’s not uncommon for the edges of the coins to have dents, nicks or gouges from being dropped.
In particular, coins composed of precious metals are more susceptible to damage than current coinage, as gold and silver is softer than metals used in modern coinage, such as nickel and copper. While rim issues don’t have as much of an impact on the price of coins as cleaned or altered coins, coins with rim issues should sell for less than coins without such issues. When in doubt, ask the seller to describe the condition of the edge or rim of the coin, or better yet, request photos.
Misgraded CoinsMore times than not, the grade of coin stated in an auction or on the holder that houses the coin exceeds the actual condition of the coin. This is not an issue with certified coins; especially those that have been graded by reputable third party grading services, such as PCGS or NGC, but is a common occurrence with raw or ungraded coins. The condition of coins is commonly embellished in hopes of realizing a higher final value for the coin. Most numismatic coins are condition sensitive, and one grade level difference can result in the value being hundreds or sometimes even thousands of dollars more. We recommend that you don’t rely on the grade of the coin stated in the auction, but that you evaluate the condition of the coin for yourself to arrive at an estimated value. An excellent resource is Making The Grade: A Grading Guide to the Top 50 Most Widely Collected US Coins by Beth Deisher, which provides detailed pictures and descriptions of all grades of coins for the 50 most popular U.S. coins.
In summary, buying coins online from auction sites such as eBay can save the coin collector a substantial amount of money over retail, but only when a disciplined approach is taken. Be sure to thoroughly inspect all pictures to determine if the coin has been cleaned, inquire as to any rim issues that may affect a coin’s value, and last but not least, don’t rely on the grade of coins provided for raw or ungraded coins, but inspect the condition of the coin yourself and assign a conservative grade. Following these steps should improve your chances of having a successful online buying experience.
This is a guest post from Tony Davis of Atlanta Gold and Coin