Answers to Frequently Asked Questions

C FC was started to meet the financing needs of a wide variety of participants in the rare coin and precious metals industry. Our business is straightforward: we make loans on precious metal and rare coin collateral. Whether you are a full-time or part-time dealer, a collector, or an investor… CFC wants to help you achieve your goals with a simple to obtain loan.

To help you understand how CFC operates, we've compiled a short list of the questions we're most frequently asked - with our easy to follow answers. Please remember: these guidelines may change at any time. We invite you to contact CFC for updated policies, procedures, fees, charges, and general business practices. Here is a sampling of CFC's most frequently asked questions…

1. What is Collateral Finance Corporation (CFC)?

CFC is a licensed California Finance Lender. CFC makes loans to dealers, collectors, and investors secured by four types of assets:

1. Bullion – A gold, silver, palladium or platinum item whose value is directly related to the value of the underlying commodity. Examples: Gold American Eagles, Engelhard 100 ounce silver bars, etc.
2. U.S. Gold Coins – Fungible semi-numismatic coins, certified by PCGS or NGC, whose value will be partially its numismatic value, but additionally the value of the underlying commodity. Examples: Common date Saint-Gaudens, Indian Head, or Liberty Head $10 and $20 coins.
3. U.S. Silver Dollars – Normally fungible, common- date US silver dollars minted between 1878-1935. Coins would normally be certified by PCGS or NGC and graded between MS 60- MS 65.
4. Rare Coins (certified by PCGS or NGC) – Coins whose value generally has nothing to do with the value of the underlying commodity. Examples: 1907 High Relief $20 gold coins, Proof Liberty Head $10 and $5 gold coins, etc. Items not covered in the preceding list may be accepted as collateral at CFC's discretion. Applications for these loans will be handled on a case-by-case basis.
2. How is CFC related to A-Mark Precious Metals, Inc. (A-Mark)?

A-Mark, with sales exceeding $3 billion per year, is a full service precious metals trading company founded in 1965. CFC is a subsidiary of A-Mark. The two firms keep independent financial and customer records.

3. How long does the process take for funding loans?

Generally speaking, your loan will be funded within one business day of CFC's receipt of all executed documents and collateral. In the great majority of cases, the loan process takes no more than 5 business days (assuming there are no liens against your collateral).

4. What are the advantages of secured precious metals financing for dealers?
1. Dealers can finance large purchases without committing much of their own capital.
2. Dealers can leverage their capital to build their inventory.
3. Dealers can use CFC's capital as traditional secured inventory financing.
4. Dealers can offer their customers third-party financing for coins/metal they acquire.
5. Dealers will enjoy "repeat" business when their customers liquidate their loans (by handling both the purchase and sale of the coins/metal).
5. What are the advantages of secured precious metal/rare coin financing for collectors and investors?
1. Financing offers collectors and investors the ability to leverage their holdings, freeing their capital for other purposes.
2. Financing offers collectors and investors the ability to purchase more coins with the same amount of money, allowing them to build their collection or portfolio with less capital.
3. Financing offers collectors and investors insured collateral storage at a secured location.
4. Financing offers collectors and investors the opportunity to own suddenly-available rarities they may not have been financially prepared to acquire.
6. How much does CFC lend against coins and bullion?

Advance rates may vary with market volatility, type of collateral, and other factors, but currently are:

1. Bullion (fungible) 80 to 90% of value
2. U.S. Gold coins (non-fungible) 60 to 80% of value
3. U.S. Silver Coins (non-fungible) 60 to 80% of value
4. U.S. Rare Coins (non-fungible) 60 to 80% of value
7. Where are my coins or metals kept during the period of the loan?

CFC will store your collateral in a secure, insured, bank-approved deposit facility. Your collateral is always 1) segregated, 2) physically independent of our assets or other customers' assets, and 3) always stored in your name.

8. How quickly can I receive my coins or metal after my loan is satisfied?

Your coins can be returned from the secure storage facility within 24 hours.

9. What are the terms, the minimum loan size, and loan fees?
1. CFC's minimum loan size is $25,000. Your interest rate depends on the size of the loan, your CFC credit history, the complexity of the collateral, etc.
2. Interest is charged and payable monthly with the principal due at maturity.
3. Loans are six months (180 days) in length, unless an extension to one year is approved in advance.
4. There is never a prepayment penalty -- partial principal payments are always allowed prior to your loan's maturity.
5. Initial Documentation Fees, Origination Fees, Handling Fees, Postage, Packaging, and Insurance Fees, and Liquidation Fees (forced or agreed) may apply and will vary. We are currently running a no fees promotion.
10. Are loans subject to margin calls if the market drops?

Yes, margin calls are typically issued if the value of your collateral declines. Margin call payments must be made within 24 hours via wire transfer to CFC's account.

11. Can I get extra loan value if the market goes up?

CFC will address this issue on a case-by-case basis depending upon your collateral, loan size, and other relevant factors.

12. What are the procedures for getting started with financing loans?

After answering all of your questions, your CFC representative will fax or mail you an easy to follow checklist.

What if I have a question that's not answered here?

Call CFC at 310.587.1410. We're always happy to answer your questions.