Collateral Lending is fast becoming the new way for consumers to gain quick access to cash. While other lending options such as mortgage or traditional consumer financing continue to tighten, Collateral (asset based) Lending thrives.

Ever since the great credit freeze of 2008, Consumers have had few choices for new loans. Sure, if you have a 790 credit score, stable employment, full income documentation, and a very low debt to income ratio (DTI) you may be approved for a loan – in other words, if you don’t “need” a loan, banks may approve you. But what about the other 97% of people out there that need immediate financing?

Collateral Based Lending

This type of lending was popular before the big mortgage boom. In fact, Collateral Lending has been around for a very long time. As the name implies, Collateral Lending are loans that are based solely on the collateral you have. There are no other qualifications in getting approved, and funded, for a new loan. When applying for a Collateral Loan, lenders will ignore: credit, income, and employment. The only qualification that is considered is the collateral, or asset, that you are putting up.

The New Trend in Lending

So why is Collateral Lending becoming so popular? If you’ve tried to get a new loan – personal or mortgage, you’ve undoubtedly been asked to supply tons of paperwork. Income documentation, credit report, bank statements, appraisals and more. And if you’ve tried to use your home to get a second or a line of credit, you’ve certainly experienced a mountainous pile of paperwork – only to be discouraged from the ultimate “loan denial”. With property values falling, mortgage lenders just aren’t lending. What we’ve all accumulated over these past few years is “stuff”. Be it jewelry, boats, cars, watches, collectibles..many of us have these types of luxury assets. These are items that can be readily used to obtain a new loan. This is the new trend in Consumer Lending – Collateral Based Lending. And it makes sense.

The Loan Process (what to expect)

A Collateral Loan is perfect for the borrower that needs immediate access to cash because the entire process can happen in as little as ONE day. Remember, Collateral Lenders are only concerned with the asset you’re using to get the loan. You don’t have to worry about credit, income, or employment for approval. If you own your asset free and clear and you’re looking for a loan amount of at least $10,000 then most likely you can complete the loan documentation and receive the cash the same day. And while loan amounts typically start at about $10,000, it’s not uncommon to receive a loan of $100,000 all the way up to 1 to 2 Million – with sufficient collateral.