Getting a loan against fine art in South Africa is a fast and increasingly popular way of accessing funds.
It makes it possible to unlock the value of fine art collections or prized individual pieces without having to sell.
Growing popularity of loans against fine art
Worldwide, the last few years have seen a marked increase in the use of fine art pieces and collections as collateral for loans.
As the American art advisory and financing company The Fine Art Group recently revealed, requests for art loans in 2020 soared by as much as 30% year-on-year.
Fine art is increasingly seen as an appreciating financial asset, which, when monetised, can be used to pursue a wide range of business and investment opportunities. An art-backed loan provides near instant liquidity, without involving a sale.
How to get a loan against fine art in South Africa
Securing a loan through lamna, using fine art as the underlying asset, is quick, easy and discreet.
Simply complete our online application form and send us an image of the artwork, together with as much information about the piece as possible, including medium, dimensions, date of acquisition and provenance.
Once we have validated authenticity, we make an initial offer of a loan over the telephone. The artwork is expertly appraised at our offices.
If the terms of the loan are agreeable, a contract is drawn up and signed. The funds are disbursed within 24 hours.
What you’ll need to apply for a fine art loan through lamna
In order to process a fine art loan, we require proof of ownership of the piece, or pieces, together with a valid ID and proof of residence.
What determines the loan value for fine art?
The value of fine art stems from the uniqueness of a piece, the method of design and the period when it was created.
An art work, created by a recognised artist with a proven sales record and history of demand, is more highly valued as a source of collateral.
The expert valuation of a piece is the sole determining factor of the value of an art-backed loan. It involves qualitative assessments, a physical appraisal, and the review of comparable art works by the relevant artist, together with the most recent prices fetched at auction.
All this information is weighed up to determine a fair market value. At lamna, we provide a percentage of the appraised value of the artwork as short-term financing.
Why get a loan rather than selling fine art?
Fast access to funds Fine art is typically a complicated asset to dispose of, either at auction or through an art dealer. A sale can take weeks, or even months, to close. Even then, the funds are not always readily available.
A fine art loan by lamna is processed on the same day, enabling immediate access to capital.
Asset retention Collateralising fine art allows for the release of financing while retaining a growth asset. Once the loan and interest have been paid back, the piece can be sold, used to secure further funds or kept as part of a family legacy.
Loans against fine art from lamna
Borrowing against an artwork, using lamna as the finance provider, is advantageous in a number of ways, namely:
- quick, discreet and confidential loan-application process
- no credit checks or sharing of information with credit agencies
- competitive interest rates in line with the NCA
- reputable finance provider registered with the FSB
- offices in Cape Town, Johannesburg, Durban and Port Elizabeth.
Here’s what our customers have to say about our asset-based loan services.
“Your turnaround speed was unbelievable. I’ll definitely be using you in the future.”
“Your transparent valuation methodology gave me the confidence and assurance I needed to secure the funds I required. Thank you for your discreet and transparent nature in which you effected our transaction.”
“Thank you so much for assisting at such short notice and handling this transaction so professionally.”
Getting a loan against fine art with lamna
At lamna, we offer fast, discreet loans against the value of a wide range of assets, from luxury watches and jewellery to vehicles, as well as fine art.
For more information about getting a loan against fine art or another asset of value, contact us on 086 111 2866 or simply complete and submit our online application form.
ILLUSTRATIVE EXAMPLE
Client borrows R10,000 for 90 days.
Loan Amount | Repayment Period | Monthly Interest | Total Cost of Loan | Initiation Fee | Monthly Fee | APR |
|---|---|---|---|---|---|---|
R10 000 | 3 months | R500.00 | R2 914.50 | R1 207.50 | R569.00 | 60% |
Fixed rates range from 36% to 60% APR and payment options range from minimum 3 to maximum 24 months. Apart from the initiation and monthly fees shown below, the only additional fee is credit life insurance if the borrower does not have this already.