Small independent art dealers don’t need to be reminded that giant auction houses such as Sotheby’s, Christie’s and Phillips have the financial clout to finance highly valuable individual pieces of artwork as well as collections at competitive interest rates. This kind of access to finance just hasn’t been available to independents – until, that is, peer-to-peer lender Unbolted arrived on the scene. We genuinely believe that every art dealer and collector should be able to access similar facilities to those big beasts we just mentioned. Borrowing against assets, we believe, shouldn’t be confined to the privileged few, hence our unique, low-interest secured asset loan.
Let’s take an example. Meet Jacob, an art dealer who set up independently in London a few years back after a lengthy stint with a big, established dealership. He loved his work there – it’s where he learnt the nuances of his craft – but once the itch to go independent started to tingle, he couldn’t put it to sleep.
Like most independents, Jacob is well aware of the difficulties that solo art dealers face when it comes to borrowing to purchase a prized work for a collector. Creditworthiness remains an issue for his increasingly successful but small and relatively young business. When he needs to raise funds fast, the banks are about the last place he would choose to go.
Jacob’s now found a rare piece by L.S. Lowry – a pencil drawing of a woman’s head – and he’s £4,500 short of the £13,500 he needs to secure it for a well-off Lowry devotee. As it happens, Jacob has the £4,500 he needs. It’s locked up in a piece by the late Mary Fedden (a watercolour and collage). Jacob does know, however, that his Fedden, signed and dated by the artist in 1986, is worth £6,500.
If he approaches Unbolted, we could help him raise that £4,500 within a day. Minutes after determining the value of a piece of art on a secondary market, we can offer an indicative loan. The £4,500 could be in Jacob’s account within 24 hours – we just need the item to be delivered to our London HQ for eye verification and for safekeeping as collateral for our loan (we lend 70 per cent of the secondary market value).
He needn’t worry for a moment about his creditworthiness, because it’s irrelevant to our pool of lenders. The artwork – the asset – is all the security we need to meet our customers’ borrowing requirements.
We charge no upfront deductions, and we won’t penalise customers for early settlement (our loans usually mature in six months). No intrusive and potentially damaging credit searches and no reporting occur if borrowers are unable to settle.
At Unbolted, the worst that can happen is that your asset is sold at auction to settle the loan, and we’ll return any excess above the agreed amount to the borrower.
With an unbeatable secured asset loan from Unbolted, independent art dealers can have access to the same kind of fast, low-interest rate borrowing against their art assets as their “big beast” relatives.
