In the Forbes article by
Cecilia Rodriguez, she discusses a new source of collateral that you can use to
be able to take out a loan. This source is luxurious designer handbags such as,
Louis Vuitton, Hermès & Chanel etc.
As most people, no
matter how wealthy they are, tend to at some point in their lives take out a
loan for something. Usually this tends to be for things such as houses where
banks can reclaim the house if the person, who was granted the loan, is unable
to pay it back.
It is now becoming a
new trend amongst (mostly) women, to use their designer handbags as collateral
when taking out a loan.
Since many handbags of
designer brands can have a very high value, depending on how old they are (vintage)
and if they are part of a very exclusive collection, using them as collateral
is a clever and innovative way of handling your personal financial business.
Looking at this
through the eyes of the person taking out a loan, it is a good alternative to
using your house as collateral.
If you have been
unable to pay back your loan and the bank is reclaiming the collateral, you
would most likely be happier losing a handbag than losing your house.
However, even though
some designer handbags may be of high worth, their value can vary drastically
which means that using them as collateral may not always be the best idea.
Another risk is that, even though the bank would have had it valued beforehand
and ensured that there is a market for it, there is nothing that guarantees
that the bag would not be damaged is some way or even stolen.
This could be a
problem if it would happen that the bank would need to reclaim it and the
person with the loan would have no way of paying it back and would be stuck
with a big problem that would be hard for an individual to solve.
To conclude, banks are
always analysing facts and making sure it is a relatively low risk to granting
people loans. This would ensure that the bank is aware of risks and possible
outcomes of having handbags used as collateral and if a person is granted a
loan, the bank is confident that this is a safe option.
As for the individual
taking a loan, they may feel a lot more comfortable taking a loan in the first
place if they are allowed to use their handbags.
All in all, as a new
innovative way of having collaterals for loans this is a good idea if risks can
be minimised as both parts gains from it. The bank has a customer who is
comfortable with the terms of the loan, and the bank is maintaining business.
Bibliography:
http://www.spentmydollars.com/wp-content/uploads/2015/03/bags-2Bmust-2Bhave-2Btop-2Bdesigner-2Bhandbags-2Bfashion-2Btrends-2B2015-2B2016-2Bwomens-2Bbags-2Bgivenchy-2Bsaint-2Blaurent-2Bfendi-2Bchanel-2Bmichael-2Bkors-2Bdior-2Bbalenciaga-2Bit-2Bmust-2Bhave-2Bbags-2B.png
