When liquidity is needed, the impulse to sell an asset can be strong. It seems like the quickest path to cash. However, when you analyze the true costs of selling—both financial and emotional—the picture changes.
First, consider the transaction costs. Auction houses charge seller’s premiums; consignment shops take hefty percentages; and online marketplaces have fees and shipping risks. You might lose 15% to 30% of your asset’s value simply in the transaction process.
Second, consider the opportunity cost. If you sell a rapidly appreciating asset like a vintage Rolex or a classic car, you miss out on all future gains. You are capping your upside permanently.
Finally, there is the permanence. Once it is gone, it is gone.
A collateral loan from Borro solves the liquidity problem without these downsides. You pay interest only for the time you borrow. There are no seller’s fees. Most importantly, you retain the asset. You are renting liquidity, not selling your legacy. For the strategic wealth manager, borrowing is often the far more efficient path to capital.
