Rate alone misleads. Add origination, storage, insurance, and penalties to get the true APR.
Compare the all‑in APR: rate + origination + custody/storage + other charges. Ask for a payoff schedule.
A practical framework to compare offers apples‑to‑apples: list every cash flow, build an APR view, and watch for compounding storage or insurance charges that quietly inflate the cost.
Start with the gross loan amount, subtract upfront fees to see your net proceeds on day one, then add the monthly interest and any fixed charges. Include storage, insurance, account fees, and scheduled appraisal updates. This turns marketing numbers into a concrete forecast you can compare across lenders.
Two offers with the same nominal rate can diverge widely once fees are included. Effective APR annualizes the true cost based on all cash flows. Ask each lender for a worked example using your collateral and term. If a lender is unwilling to provide it in writing, treat that as a signal to proceed cautiously.
Watch for minimum interest periods, pay‑out floors, late‑fee ladders, and auto‑renew clauses. For vaulted assets, storage and insurance often compound monthly; check whether fees scale with market value or remain fixed. Clarify how partial redemptions are treated and whether early repayment incurs a penalty.
You can often trade LTV for price: accepting a slightly lower LTV may unlock better fees. Bringing multiple quotes helps. Share a clean inventory list, recent appraisals, or proof of provenance to reduce the lender’s uncertainty—less uncertainty usually means lower pricing.
Updated on 2025-10-21. Educational content only — not financial advice.