Are you looking to get a loan from Diamond Banc? We strive to make each step of the jewelry equity loan as quick and easy to understand as possible. First, to understand how interest rates are calculated, you should know what Loan to Value Ratio.
How Does Loan To Value Ratio (LTV) Affect the Interest Rate?
LTV, otherwise know as “loan to value”, is the amount borrowed versus the amount loaned. The difference between these amounts may be large or negligible, depending on each situation. Sometimes, your high-end jewelry may be valued at much more than you were looking to take out in a loan.
Therefore, when a borrower needs less than Diamond can offer, the interest rate will decrease. This is because Diamond Banc’s risk decreases. Basically, risk is the assumed depreciation a lender will suffer if the loan is forfeited. Therefore, if a borrower takes out a loan smaller than what we offer, the interest rate is much cheaper.
What Type of Jewelry Makes Good Collateral?
In addition, certain high end jewelry may demand a lower interest rate. This is because some items have a more competitive market value. Thus when a high-value jewelry item is pre-owned, Diamond Banc may offer a lower rate to beat our competitors. Some examples of highly sought-after jewelry that make great loan collateral are Rolex watch models, high quality gold or other precious metals.
Have any other questions about how Diamond Banc calculates interest rates? Call or email and a Diamond Banc jewelry expert will get back to you with answers! Get started today!