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What Can I Use as Collateral for a Secured Personal Loan?

Jun 8, 2008
People often think they don't have anything valuable to use as collateral for a small secured personal loan - like you might get at a pawn shop. The fact is, the average person's house is crawling with junk that a pawn shop would be happy to hold onto, if you just know where to look. Here are some of the things pawn shops love to lend money for:

Electronics
Pawn shops love electronics, and they are probably the most common thing people use to pawn or as collateral for a loan. Some examples of electronics equipment to use as collateral are: CD Players or CDs, Computer systems, Laptops or notebook computers, DVD players and DVD movies, Video Game Consoles and Video Game Software, Cameras (digital and analog, still frame and video), and Televisions. Because of the common nature of electronics in pawn shops, however, you need to be ready to prove that the item in question is in good, working condition, and that all the necessary parts are included. As with any other item, the lender is likely to decline if the item you'd like to use as collateral is broken, in need of repair, or just overly dirty.

Musical Instruments
Musical instruments are another great item. Guitars nearly always go well, assuming that they are in working order, and all strings are attached and in good shape. Electric, Acoustic, and Bass guitars all are good examples of musical instruments that could be used as collateral. Accessories like effects pedals, P.A. Instruments, and speakers do will also, along with Keyboards, microphones, Orchestral instruments, or drums.

Jewelry
Jewelry is a staple of small secured loans collateral - its small, valuable, and it almost never breaks. Items like diamonds of any size, gold in any form, pocket watches, Silver (in any form), or wrist watches all will do fine. Furthermore, fine china or crystal service is often accepted as well.

Sporting Goods
Sporting goods work exceptionally well for quite a few people - some items can be difficult to use as collateral because the lender is likely to require the property stay on site for the duration of the loan. As such, practical items like vehicles aren't always a good choice to use. However, sporting goods are items that are required only for leisure activities. Giving them up for a while won't likely make much of an impact on your day to day routine, and since you're short on money in the first place, you wouldn't likely be using them anyway. Some of the items in this category are: Bicycles, Boats and boat motors, fishing equipment, golf clubs, jet skis, snow skis, and knives or swords, Guns are often accepted as well, but its important to note that guns require proper paperwork and id.

Vehicles
Lastly, vehicles are nearly always accepted as collateral - its a simple equation for the lender: vehicles are very practical items, and nearly everyone needs one, so no matter what, he'll likely be able to sell the item should you stop making your payments. As noted above, in many situations the lender is required to keep the vehicle on premises for the duration of the loan, so this can be an impractical solution for some. Other related items often used are Motorcycles, Trailers, Go-Carts, Golf Carts, or Four Wheelers.
About the Author
Mike helps people understand small secured personal loans and other secured personal loans
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