2022-Proofing Your Business: How Luxury Asset Lending Can Insulate You From Uncertainty
The global pandemic taught us all some very pertinent lessons. Two of them, and probably the most important for small businesses, were (a) you need the ability to pivot, and (b) you must shock-proof your business from uncertainties.
But how do you protect your firm from sudden shocks? By pivoting towards assets that you already have on hand and leveraging their value to support your business.
Luxury Asset Lending: A Better Way to Tide Over Financial Difficulties
This brings us to the topic of luxury asset lending, and how a secured luxury asset loan can help you ride through difficult times. Let’s take a look at how:
You are a small business and you’re currently going through some not-so-fortunate days. You are in need of working capital . But you don’t have any cash on hand. You’ve already exhausted your line of credit. But, perhaps you have a Ferrari or a Porsche in your garage. What do you do?
You get a luxury asset loan on your Porsche!
Is that even possible, you ask? Let us tell you that a 1967 Ferrari Spider (remember Steve McQueen driving one in “The Thomas Crown Affair?”) was auctioned out for $27 million! While your luxury or vintage car might not necessarily hit such an astronomical price point, chances are that you’ll be able to leverage your vehicle as collateral on a solid loan amount.
In short, if you have a luxury car or motorcycle, a valuable painting or other fine art, a yacht, jewelry, luxury watches, handbags, coins, or precious metals, you are eligible for luxury asset lending. It’s not that different from a regular loan – only you’re using a luxury item you own as collateral.
Why Luxury Asset Lending?
As a business owner, you’d want all your bases covered. Before getting a luxury asset loan you would want to explore options and choose the best one, right? Let us discuss why a luxury asset loan might be perfect for you.
Fast and Simple
Yeah, within a few days! Banks or other big institutional lenders are notorious for taking a long time to disburse a loan. Bank loans usually have lengthy processes of valuations and approvals. They will want to be absolutely sure about your ability to pay back the loan. And they will take a long time to come to a valuation for the collateral you are offering.
In case of luxury asset lending, it usually doesn’t take time to arrive at a valuation for the asset you are offering as collateral. Most lenders have either in-house valuers or have access to a large pool and they can get the asset valued pretty fast.
Lenders usually do not ask for a credit score and the fact that you are the sole-owner of the luxury asset is what is important in getting you a good deal on the loan. Before you know it, there’s cash in your bank.
Nobody Needs to Know
This surely is one of the greatest aspects of luxury asset lending. Most regular loans leave a footprint on your credit history. This can create a good or bad imprint on it, depending on your past financial history. And if this negatively impacts your credit score, you will find it difficult to secure a loan in the future, should you need one.
Major lending firms often ask for your credit score. The more lenders you approach, the more credit checks will be performed, and this eventually negatively impacts your credit history.
Also, If your history gives them even a whiff of an indication that you may face trouble returning the borrowed money, it could play spoilsport on your chances of getting the loan, not to mention the little red mark it may put on your credit rating.
Luxury asset lending, on the other hand, usually does not require credit checks to be run and hence does not tend to leave any footprints on your credit history. So when you get a loan on your luxury asset, nobody needs to know. As previously mentioned, all you need is a solid luxury asset to back the loan and the money is yours.
You get money for an asset you do not need or can live without. Just like the 1967 Ferrari we mentioned. You are not putting up your house to get the money. And this makes luxury asset lending very convenient because you can leverage an asset that probably only had collector’s value to help you tide over a difficult situation. And the loan size is proportionately equal to the current market value of the asset.
Remember that the 1967 Ferrari is a luxury and not a necessity. It may have emotional value, but in the worst case that you are unable to pay back your loan amount, all you stand to lose is something that doesn’t make it difficult for you to live, like your home.
While it doesn’t mean that you as a borrower don’t take the matter of returning the loan amount seriously, the fact that you have offered as collateral an asset that you can do without brings you peace of mind.
When the Going Gets Tough
Small businesses are often the first to get affected in a situation as difficult as the one the pandemic forced us into. We’ve all heard heartbreaking stories of businesses that were built from the ground up by decent, hardworking folks go down because they were not able to sustain the pressures that were brought on by this unprecedented global phenomenon.
But there is a way. And luxury asset lending can help you shock-proof your business during difficult times. From the above, it is clear that this kind of collateral lending can get you access to liquidity quickly. This can go a long way in future-proofing your business.
Vasco Assets: We Have Your Back
According to the U.S. Small Business Administration’s report, there were more than 31 million small businesses in the U.S. in 2020, and make up 99.9% of all firms. They also employ almost 50% of the private sector workforce.
The report goes on to show that more than 30% of small businesses were financially impacted in August 2020. The number would surely be more now that the world is still struggling to get on its feet after almost two and a half years into the pandemic.
Vasco Assets understand and appreciate the importance of the role small businesses play in our nation’s economy. It has always stood by them in their times of need. As a leader in luxury asset collateral lending, it gives you the ability to leverage your luxury assets – whether you wish to sell them or get a loan on it to help with cash flow.
With a team that has over 150 years of experience and expertise in luxury asset management, we have a global presence in multiple markets and immediate access to luxury asset capital.
If you are a small business looking to leverage your luxury assets, we can offer you the best suite of managed financial services with great interest rates and repayment terms.
We believe that all businesses, big or small, must have access to easy finance to operate smoothly or to scale operations and grow. Only then will the nation’s economy be strengthened. And Vasco Assets, with its world class managed services is playing its role in helping bring this dream into reality.