Those things that you own free and clear are your assets. As assets have value, if it becomes necessary they can be pledged as collateral for a loan. Loans in Dallas are available from lenders that will take your assets in return for cash; in the event you fail to repay the loan the lender can sell the assets to get his or her money back. Collateral is good if you wish to apply for a large loan, it is also good if you have less than sterling credit and you have difficulty getting a loan.
The beauty of pledging collateral is that the lender is assuming less risk and as a result you will get a better rate of interest.
-
Types of collateral:
Basically, any asset that you own that the lender is willing to accept can be used as collateral. The greatest majority of asset backed loans in Dallas TX use collateral which are easy to value, easy to store and easy to turn into cash. Some of the most popular assets that are accepted include precious stones, precious metal; works of art, valuable watches and antique firearms.
-
How asset based loans work?
The process is actually quite simple. You are expected to bring your acceptable assets to the lender for appraisal. Obviously the lender will discount the actual value of the asset; often the amount discounted is based on the volatility of the market. Once you have agreed with the appraisal funds will be deposited directly into your bank on the day the arrangement is agreed. The arrangement is based on you making a specific payment every month for a specific number of months, once this has been satisfied your collateral, which is your asset, is returned.
Assets backed loans in Dallas can be used for a number of reasons. Many start-up businesses will use this type of financing as they have yet to establish a track record of profitability.
