Luxury Goods Finance

Interest rates and costs vary significantly from lender to lender, and several factors influence what luxury goods finance will cost. Ultimately, what you pay will centre on your lender’s enthusiasm for lending, the valuation of your assets, risk, your profile, how much you wish to borrow and what luxury goods you are using as collateral. 

Enness will always make sure you are paying as little as possible for your loan. At the same time, your broker will ensure you enjoy as much flexibility as possible. For example, depending on your exit strategy, your broker may propose they negotiate terms that allow you to pay your loan off early without you being charged an early repayment penalty. 

The terms Enness negotiates for luxury goods finance will be unique to you, and there is little room to guess what you will be offered without putting forward your goods for consideration. Enness can make discreet, no-obligation enquiries with lenders on your behalf, if you wish to explore what kind of offers or financing options will be available to you through your luxury goods collection.

Lenders will want to assess your goods carefully. They will principally want to value your collection, but they will also want to evaluate the condition of your goods and ensure they are authentic. 

Appraisals are carried out by experts who specialise in the type of luxury goods you want to use as security. They may work directly for your lender, or your lender may appoint them as a neutral third party. If you want to use more than one type of luxury goods as security, expect that separate appraisers may be bought in to perform individual evaluations. 

The appraiser will consider:

• The brand 
• The model (for assets like cars, handbags, and watches)
• When it was made
• When you bought it 
• If you are the first owner 
• How rare it is
• The provenance of ownership (especially for goods like art and jewellery). If you are not the first owner, lenders will also want to understand how you came to own it.
• The condition
• How you have stored it
• Any damage or wear and tear 

Luxury asset finance is a very specialist part of the market. Lending is risky because demand and prices can fluctuate significantly, plus there is always a risk of theft and damage, so lenders always tread with caution. Usually, lenders will allow you to borrow in the range of around 50% of the total value of your luxury assets. Because of the costs associated with this type of lending, you will generally need to have a single collection of luxury assets valued at £700,000 or more. However, most lenders will prefer that you can put down security of around £1 million or the equivalent in another currency. 

Your assets will also influence what you can borrow. If you have a high-value art or wine collection, you will likely be able to borrow more than if you have a collection of Hermès handbags, for example. For jewellery, handbags and watches, you will usually be able to borrow amounts from £250,000 up to around £5 million, depending on your assets. If you wish to borrow against art, wine or cars, you may be able to borrow more, depending on the value of your collection. 

Whatever you wish to use as collateral and however much you want to borrow, Enness will be able to source the most advantageous rates and terms for you. Acting wholly in your best interests and working to see the deal through to completion quickly and smoothly, you will benefit from Enness’ experience and lender network. Transactions will move fast, and Enness will help you save both time and money with a luxury asset finance deal custom-built for you. 

Borrowing against luxury goods is complex, so this type of lending is only possible if you have significant luxury assets. You will most likely find it makes sense to borrow against a collection of luxury goods rather than a single luxury goods item. However, in some cases, if the value is high enough, you will be able to use a single item in your collection as security. Lenders will usually have just as much interest in using a £75 million Picasso as collateral for a loan as they would using a portfolio of art that is valued at the same amount, for example.

There is simply too much risk and too little reward for larger institutions like banks to lend against luxury goods. They also don’t have the in-house expertise needed to cater to this type of lending. 

Therefore, speciality finance is your best option for getting luxury goods finance.  These lenders are often very niche, small players and many do not publicise their services or offer direct contact routes. The only way to connect with them is via an introduction from someone already in their circle. Enness has access to all the players who provide luxury goods loans in this exceptional market. Enness will be able to source and negotiate the most attractive luxury goods finance from respected, vetted lenders who will offer you the best rates and terms.