Fed rate drop saves money on coin loans
(Santa Ana, California) – The Federal Reserve Board’s reduction in the prime lending rate, September 16, now is saving collectors and dealers money on loans based on certified collectibles as collateral.
“The Fed rate cut has resulted in significant savings on loans because the loan rate is based on the floating prime rate. A collector or dealer obtaining a $50,000 loan for one year now will save $125, and the savings are even greater for higher loan amounts of that duration,” explained Mike Lewis, President of Collectors Finance Corporation (CFC) of Santa Ana, California, a division of Collectors Universe, Inc. (NASDAQ: CLCT).
“One of our collectors who borrowed from us in order to upgrade his collection of Saint-Gaudens Double Eagles is saving $2,500 this year as a result of the drop in the prime rate,” he said.
“The loans can quickly provide additional funds for paying off auction bills or making additional acquisitions for inventory or a collection. We’ve had a number of collectors and dealers who have taken advantage of the lower interest rates since the Fed lowered the prime rate by a half-percent.”
Only collectibles certified by a division of Collectors Universe can qualify for a loan. The subsidiaries are Professional Coin Grading Service (coins and bullion); PCGS Currency (bank notes); Professional Sports Authenticator (sports and trading cards); PSA/DNA Authentication Services (sports memorabilia, photographs and autographs); Professional Stamp Experts (stamps); Gem Certification and Assurance Lab (diamonds); and American Gemological Laboratories (colored gem stones).
Loan amounts range from 35 up to 80 percent of the market value of the certified collateral based on the type of collateral, and loans can be made for up to one full year.