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Whenever people think about selling gold items, they typically turn to pawn shops, jewelers, and professional brokers. Are these the best options? For many unsuspecting sellers, it may mean taking an offer that undercuts the true value of the gold to even lower than street value.
People who inherit heirlooms, wedding rings, and gold bars often wonder how to sell their newfound possessions in hopes of making a small fortune. Oxford Gold Group entertains innumerable clients who want to sell precious metals so they can fund a small business, improve credit scores, or go on a vacation they’ve been dreaming about for years. In this guide, our expert traders will demystify the process of selling gold, so you can maximize your returns on your priceless possessions.
Can You Sell Gold to a Bank?
Most people approach friends and relatives first when they have a gold item to unload. However, the colorful history of the heirloom and fluctuating market value makes it challenging to find an honest appraisal for your gold from those close to you. Other people rely on financial institutions, like banks and licensed lenders, hoping to use their gold to buy homes, cars, and retirement plans.
However, going to those institutions for advice often means accepting unfair appraisals for gold, silver, and other items that these institutions use as convenient hedges against inflation. The founders of Oxford Gold Group are on a mission to prove that precious metals are reliable investments, but it is wise to be careful about which institutions to trust for your money’s worth.
In the early days of the American banking system, most lenders, financiers, and accountants calculated their customefr’s money in gold using the gold standard. It determined the value of bills, coins, and all tradable items equivalent to their value in gold. However, the government replaced the standard with an infinitely more complex legal tender called fiat currency.
Every financial institution in the United States used to accept gold, but fiat currency changed that interest in precious metals. Only a handful of banks now accept gold and other precious metals from private individuals. Most of the global gold trade occurs between businesses, governments, and semi-public institutions with interests in the minerals market.
Do America’s Three Primary Bank Structures Accept Gold?
The only way to know whether the bank accepts gold items is to ask. Look at the different types of banks that can serve you and ask for details about how they’ll appraise your gold.
The most profitable financial institutions in the United States are commercial banks. They interact directly with private clients, offer loans, accept deposits, and sell financial products to anyone with a good credit history. The Federal Deposit Insurance Corporation lists over 7,000 active commercial banks in the country, many with retail and wealth management arms.
America’s mainstream commercial banks operate from a base of trust and loyalty. People go through thorough background checks before they can obtain a loan, open a new account, or convince the bank to buy something from them. Most commercial banks are hypervigilant about counterfeit gold items and shy away from precious metals.
Unlike virtual banks and credit unions, commercial banks have physical locations that carry testing equipment for the authenticity of gold and other metal items for a few trusted clients. Most have billions of dollars in gold bullion in safety deposit boxes and private vaults but don’t offer precious general metal trading services. If you have time to wait on the long processing times, why not call the commercial banks in your state and ask if they’re willing to accept gold items from you?
Savings banks are nearly identical to their commercial cousins but focus on high-interest rates for time deposits and long-term savings accounts. Savings banks operate under two categories:
- Federal savings associations or federal thrifts are community-based institutions. These offer no shareholding structures with loans, savings accounts, and residential mortgages available to private individuals.
- Mutual savings banks receive funding from the government. Their clientele can use savings to invest in loans, bonds, mortgages, stocks, and securities while sharing losses and profits.
Most savings banks have no internal shareholding structure, so the members set some of their own rules on what to buy and sell. However, most American savings banks accept only legal tender (currency). Selling gold to a savings bank is almost impossible.
Over 100 million Americans are also part of credit unions, but these don’t accept gold. The next option is financial cooperatives, where members own and operate cooperative banks as savings, investments, and money-lending institutions. Many mutual savings banks and credit unions operate like financial cooperatives.
Creating new investment instruments with different shareholding components every year blurs the distinction between savings banks policies and autonomous cooperatives, which could be risky. However, financial cooperatives offer up to five times better protection than commercial banks during crisis scenarios.
How to Sell Gold to a Bank
Finding a bank or financial cooperative willing to take your gold items is tricky. If you find one, expect it to accept only gold bars and coins. Brush up on your negotiating skills and represent your interests clearly in front of these experienced bankers if you want to try and sell gold to them.
The gold items must have certificates proving the chain of custody and London Bullion Market Association approval (mints). Most banks are middlemen between you and a qualified coin dealer, and their certification process takes a long time. You will also shoulder the cost of verification.
- If you’re looking for the best gold prices, you should try another avenue.
How to Sell Your Gold for Maximum Profits: Three Tips from Oxford Gold Group
How can you find the best possible rates if you are one of the fortunate few in the world to own a gold item with the intent to sell it? Here are Oxford Gold Group’s three practical tips for trading your gold items for cold, hard cash:
#1 Identify Your Items Correctly
Americans are fans of gold bars and coins as a hedge against inflation, keeping these items in vaults, safety deposit boxes, or buried in the backyard. Unless you’re a private miner, your gold item will belong to one of four classifications—bars, coins, jewelry, or scraps.
Legitimate gold bars and coins must have serial numbers, purity ratings, and mintmarks from an LBMA-approved mint. Most gold bars and coins have a purity rating of 18 karats and above. If they have a minting of 24 karats, jewelers classify them as gold bullion, which is one of the most highly prized items in the precious metal trade.
- Gold coins are collectibles, and their stamps can make them more valuable than their smelted weight. For example, one 1908 Hungary 100 Korona Gold Coin is typically worth over $1900.
- Gold jewelry and wedding bands from famous fashion houses can also be worth more than their weight.
- Gold scrap is the cheapest form of gold, mostly in the form of ingots and amorphic rocks.
#2 Find Takers for Your Gold Items
You must weigh all gold items before putting them on the market and decide on a payment method. You will find many internet auctions and buy-and-sell groups that accept online payments.
Social Media and Internet Auctions
Many Americans prefer to sell their gold bars, coins, and jewelry online. Websites like eBay, Craigslist, and Facebook host auctions and buy-and-sell groups where anyone can sell their gold to the highest bidder. However, these groups are the most vulnerable to scammers, and establishing the trustworthiness of potential buyers is next to impossible.
Groups on social media sites are also invite-only, so staying connected with a friend who knows about trading precious metals is sometimes beneficial.
If you don’t want to sell gold over social media, a more risk-averse method is a reputable online dealer. You’ll likely need to go through background checks and complete a signup sheet before you can sell your gold, but the extra layer of security is well worth it.
Most online dealers pay for your preferred shipping method and insure your gold items. After you sign up, they will send you an envelope that you can use to mail your gold item to them. They will then quote you a price and payment options and mail the gold item back to you if you are not happy with the arrangement.
Legitimate coin shops are typically the fastest way of selling gold items without shortchanging you like a pawnshop. Their specialists verify the ownership history and purity rating of your gold bars and coins, but it is best to shop around before committing to selling your gold.
Jewelry stores don’t accept gold bars, coins, and ingots. Only wearable items sell. Luxury chains from Chanel and LVMH only take back accessories that were originally from their stores.
#3 Call Oxford Gold Group
Do you need to know more about buying and selling gold or investing in precious metals? The Oxford Gold Group experts aim to help people achieve financial security this way. Our experienced investment team is more than happy to assist you in making informed decisions about gold and any other metal venture.
Call us today at 833-600-4653 and avoid the beginner pitfalls that come with selling precious metal items for what they’re truly worth.