Bank loan for domains

[mitok]

I would like to ask, if anyone knows does anywhere in world exist any bank which gives loans if you put you premium domain(s) as a mortgage?
And if not, do you know why? What are the reasons that banks dont do that?
I would appreciate some answers, infos, and small discussion about this subject. Thank you.

 

[siga]

I'm sure the more experienced members will be able to give you further info and perhaps alternatives.
The one I'm aware of is not a bank but more of a pawn shop.

Rick Latona operates Digi Pawn which does something akin to what your looking for.

 

[SpareDomains]

http://www.domaincapital.com/
http://www.digipawn.com/

 

[mitok]

I heard for DomainEquity.com and DomainCapital.com, but i was wondering if there is any official bank which gives such a product, and if not, why is that? Are there any restrictions or banks are just not into that a finds that too risky. Or is a problem how to legal give a credit to someone in U.S. if bank is located in some European country only.

 

[dotnom]

I heard them too but i never read any experience from actual users
How these 2 work ?

I have US and European customers that maybe interested (if the interest rate is logical)

 

[mitok]

I am just asking if that exist anywhere in the world. I think that could be a great thing for domain industry if you could be able to use your domains as a real mortgage.
The most, i am interested if any official bank allowing those kind of credits, and second thing would be if there is any restrictions for that by ICANN or anyone else, and how would be legal solved credits to citizens in for example U.S. from bank which operates just in one country, and it is on other continent.

 

[bmugford]

I am not sure if your question is referring to buying a domain with a loan, or taking a loan with a domain as collateral.

I am assuming you mean collateral when you are saying mortgage.

Anything can be used as collateral that a bank judges as having value. However, unless you can show some finite value of a domain to the bank I don't think in general they are going to be open to that.

Brad

 

[mitok]

I am not sure if your question is referring to buying a domain with a loan, or taking a loan with a domain as collateral.

I am assuming you mean collateral when you are saying mortgage.

Anything can be used as collateral that a bank judges as having value. However, unless you can show some finite value of a domain to the bank I don't think in general they are going to be open to that.

Brad

Yes, probably collateral. English is not my first language so i have some problems.
Every bank must be sure that they will cover money which they eventualy gives to customers as credit, loan. So domains could be mortgage, insurance, collateral. Banks could take as collateral houses, villas, land, car etc......but have anyone here ever heard that any bank in the world ever took a domain name as collateral?

 

[dotnom]

Many banks are not specialized to appraise the value of domains plus that the liquid entity of the domain makes it even harder.

 

[bmugford]

I am sure with high enough quality domains, and a track record you could convince most banks to the value of a domain. The problem a bank would have is how to judge value. Domains don't have set prices like many assets, and there are not steady comps in general like with real estate.

It is hard to quantify the value of most domains.

Brad

Yes, probably collateral. English is not my first language so i have some problems.
Every bank must be sure that they will cover money which they eventualy gives to customers as credit, loan. So domains could be mortgage, insurance, collateral. Banks could take as collateral houses, villas, land, car etc......but have anyone here ever heard that any bank in the world ever took a domain name as collateral?

 

[mitok]

Yes, but for some domains is well known what is the lowest range what seller could get anytime for it, i mean anytime.
Please write here if you have ever heard that any bank in the world ever took some domain name as collateral. Or if not, and you know the exact reason why this is not possible, also write here please.

 

[bmugford]

I am sure you could get a loan with a domain like TV.com as collateral. However, for most domains I don't think most banks would be interested.

Most domains are not liquid enough of an asset.

Brad

Yes, but for some domains is well known what is the lowest range what seller could get anytime for it, i mean anytime.
Please write here if you have ever heard that any bank in the world ever took some domain name as collateral. Or if not, and you know the exact reason why this is not possible, also write here please.

 

[mitok]

I am sure you could get a loan with a domain like TV.com as collateral. However, for most domains I don't think most banks would be interested.

Most domains are not liquid enough of an asset.

Brad

I agree, but have you ever heard that any bank ever grant any credit or loan for some domain quality like TV.com ? Of course, i cant even imagine thank banks would grant loan for some generic 2 or 3 word .com domain, other extension i would not mention at all.

 

[dotnom]

Banks created a pile of different loan categories, like car loans, vacation loans, marriage loans apart the known to all real estate/business loans

As far as i know there is no bank that offers a domain loan

I suggested to a friend of mine that is a bank executive of a well known bank to create a similar loan and he replied that they don't have the right persons for this and they're not interested because there is no positive interest from customers

 

[theuniverse]

contact your bank with your idea of giving loans to domains with detailed explanation,they may think about your idea and they may setup a system in future to give loans to domains.this will be useful to you and others.

 

[dotnom]

contact your bank with your idea of giving loans to domains with detailed explanation,they may think about your idea and they may setup a system in future to give loans to domains.this will be useful to you and others.

I prepared a 20 page analysis and i have a friend at the board and still were not interested. I even showed them part of my LL.com and LLL.com portfolio, my QWA.com sale at Sedo but that wasn't inspiring for them.

That was before the economic crisis and with current condition to continue i don't see many thinking to launch a totally new product when they don't grant loans even for the basic types.

 

[mitok]

dotnom, you have PM.

Its a big problem that bank need risk free collateral, and domain names have not fixed value. Second problem could be that domainers would might not accept for example $3k loan and obligation to give in custody for it domain name which is worth some $xx.xxx amount. Also, i dont know is it possible for banks to credit non resident.

 

[dbtbandit67]

if you have a proven track record as a domainer and you make an excellent case for a particular domain, i don't see why you couldn't apply for a small business loan using domains as the business model.

which should be easier these days since the President recently increased federal funding for the Small Business Administration.

 

[mitok]

I belive some banks would allow that for VIP customers, but in separeted cases.......but i am interested in massive product, with defined conditions. I dont know for any such case in the world

 

[plaggypig]

Another issue is the legal ambiguity of whether or not domain names are property or service agreements. IANAL but I would think that this creates implications on using domain names as collateral for securitised loans. Don't know how DigiPawn and DomainCapital overcome this?

Still, I think the overriding problem is just the sheer difficulty of appraising value.. the banks can't even properly value mortgage securities