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Dealers buying raw coins at fractions of real value
logger7
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I've seen a number of dealers who have unknowledgeable sellers walk into shops and sell high end coins, even uncertified ones at fractions of actual value. Is there a good way around this problem when the inheritors of an estate stop at buyer's shops oblivious to potential value? The ethical way to buy would be to tell the owners that offers should be made after the coins are certified and the market for those coins is assessed; rather what I usually see is that potential gems are bought for low MS value.
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It is called ethics.... and not all people in the business/hobby have them. Cheers, RickO
One should liquidate his coins in enjoying life - travel, cars, sugar baby before this would be a possibility faced by his heirs.
Raw coins are always a risk, bidders will bid low factor this in. Sadly many ignorant sellers may get ripped. A guy in coin club once purchased estate from his church at 10- 20c on Dollar vs MV.
I'd just sell stuff on ebay and split it all (less the capital gains and fees).
The 10% loss is a fraction of the loss you'll take, with the risk of a scheister.
Besides, dealers already have two of everything in better shape and they don't sell, but they could give a fraction of that. And no you can't see the other two they're in the safe. If you walk out the door, your pennies-on-the-dollar offer expires! You'll never get a better one, act now!
How does getting a coin certified prevent low-ball bids?
This happened more than you can even fathom, two other dealers here in the area, smoke people who are uneducated, and most of the time, its most because they inherited it.
When you mix ethics with making a profit, you get all sorts of outcomes.
On one hand, in a perfect world, the dealer should be upfront with the value of the goods and offer an honest, fair price.
On the other hand, if the seller is ignorant of his or her other options (Ebay, certification or doing one's own research), then you could say, 'hey, it's a free country and I (as a dealer) will try to buy this as low as possible'.
You choose.......either outcomes happens.
I can't sit high on my soap box and put down the dealer that chooses to pay as little as possible.
We're hypocrates if we do.
Why? Because we all do it to some extent.
Look at all the posts of how we cherrypick items off of Ebay for such low prices when the coin is worth so much more.
Not to get religious but 'let he without sin cast the first stone'.
"“Those who sacrifice liberty for security/safety deserve neither.“(Benjamin Franklin)
"I only golf on days that end in 'Y'" (DE59)
Sorry, pet peeve. Any legitimate buying is done at a fraction of the value. For example, if a coin is worth $100, a dealer may pay $80, to make a $20 profit. That is a fraction 4/5ths of the value. If the dealer paid $99 for a coin worth $100, the dealer will not be in business long, but still paid just a fraction of the coins value, in this case 99/100ths.
Like the shills for paying back taxes, PAY JUST A FRACTION. If you owe $10,000 and pay the IRS $9,999, that is still a fraction.
You need to define a fraction that is acceptable, then the fight will begin over how high or low is fair.
Oh Boy, another let's clean up everything wrong with society thread.
I'll play along. The GOVERNMENT could regulate the buy and sell prices and anyone selling for more or buying for less would be branded on the forehead with a 
.
If the dealer says the coins are worth an inappropriately low price; that is different than saying, I am wIlling to offer you X. I would expect someone to ask about values by multiple sources. Lots of things are sold at higher prices than they are valued at. I think of my sister in laws store, she acquires things at a price then marks up 50%. She does not tell her customers her acquisition cost, no store does, it is up to the customer to decide if the product is worth the price. I believe the same is true with the OP question. Whether you are making money on the acquisition or the selling of the product there is responsibility in all the groups to come out the way they want. I think it is unethical to tell someone your coins are not worth much to acquire at a low price, but it is not unethical to offer a low price.
As someone else has stated cherry-pickers of this hobby are in trouble, people who buy ngc to turn to pcgs for profit, people who send to cac to profit from the bean. Should we be telling the person we are buying coins from our plans to profit from them?
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The way money is made in coins and other collectibles is by being able to "read" the seller and pay as little as possible. Most heirs of such collections want only one thing ... fast cash. They know nothing about the collectible and just want it gone as quickly as possible.
Don't die with your collection.
A few examples; the family comes in with an earlier Bust half that has few marks, is fully lustrous with the earmarks of a full gem; a Lewis and Clark gold dollar, same story, the spread between MS64 to 65 or higher is huge, you pay $1000 for the raw coin it comes back as a 65 with a likely cac future with a value over $5000. A Trade dollar that looks gem, you buy it as a BU. Even HA and Rarcoa have their numerical grade gold sheets, vs. the BU pricing. There may be no good way to give the customer 70% of real market before grading. They inherit stocks, bonds, real estate, etc. not realizing these collections properly marketed could represent a lot more money.
@291 fifth said: Most heirs of such collections want only one thing ... fast cash. They know nothing about the collectible and just want it gone as quickly as possible. Don't die with your collection.
Why not? I built my collection for my own satisfaction, with money that I earned. If my heirs don't want to become knowledgeable about the values, what concern is that of mine? They can consider themselves fortunate enough simply to be named as heirs. I'm not responsible for maximizing their windfall.
I knew it would happen.
I would not say a word. As an ignorant young coin collector in a man's coin shop, I learned the hard way to mind my own business.
I have met many coin collectors who play the same games when trying to buy a coin from another collector.
RMR: 'Wer, wenn ich schriee, hörte mich denn aus der Engel Ordnungen?'
CJ: 'No one!' [Ain't no angels in the coin biz]
It doesn't. But the collector who has gone to the effort to get his stuff slabbed is .....more likely...... to have some sort of plan to dispose of the stuff.
these things all work out for both sides, all a dealer has to do is assess value, price off the GreySheet while factoring in his margin and follow with an offer.
we had two different people bring in collections this week that we made offers on and both of them walked, one an inherited estate and the other a collector. the offers were good and the benefit for us was a little over a half day of wasted time. people "shop around" and it wastes a dealers time because most often they won't return even if they sell for less to someone else. they are to prideful and embarrassed. most dealers talk, so they know what goes where in a local area.
another thing that happens is as follows -- a guy comes in with a VF 1921 Morgan, we offer him $15 and he becomes irate because he saw one online that sold for $400. we explain about grading and tell him we'll sell the coin for about $17-18, if he wants to buy some at that price we'll show him. nobody ever looks, they're either PO'd or embarrassed and they leave.
I just this morning offered a woman $14 for a 1921 Morgan that might grade F/VF and she said the guy down the road offered her $27. I suggested she go back and sell it to him.
What I always liked was the "kid" (about 19-25) with the sniffles who would come in and furtively hand me a slabbed coin and when asked where he got it would answer some BS stuff like, "My ...GRANDMOTHER....gave it to me."
Where are all these numismatic Grammaws?
Nothing new. Slabs just help prevent people from using steel wool on the coins to make them "shiny."
I had a numismatic 'Grammaw', and still have some of her coins and numismatic books.
RMR: 'Wer, wenn ich schriee, hörte mich denn aus der Engel Ordnungen?'
CJ: 'No one!' [Ain't no angels in the coin biz]
most inheritors are happy with whatever they can get, but a dealer should still pay fair.
Not likely. Folks who inherit slabs are like everyone else. At the recent FUN show, a lady and her husband came to the table with a box of raw coins and dollar rolls they inherited. Nothing special. But we picked out a dozen or so that were worth slabbing so they would not get ripped off. They said they had more for me the next day. The next day they came in with what turned out to be over $100K of gold in PCGS and NGC slabs. They had tried to value them with no real luck. One of our employees got the PCGS Price guide and put values on a sheet for them. This is a typical experience I've had with people who inherit things. They have no clue and must go through lots of trouble. BTW, I think we all should like to have that kind of "trouble" in our lives. These folks were fortunate, A week after the show they called to thank us as they had sold that first batch of coins.
Two dealers had low-balled them big time without knowing the folks had a reasonable price guide to consider. They sold to a dealer who offered them almost what a dealer would pay to another dealer! They are going back to him to sell more coins.
My granmaw left me some firearms, no coins. After the post about the dealer being gunned down, I would not deny a dealer a fair profit. He is risking his money, even his life, and I agree a fraction can mean anything from 99/100 to 1/100.
Try not to look too furtive.
Leave instructions with the right sellers for your heirs. My daughter knows which coins she will sell in a Heritage FUN auction, through private sale by Onlyroosies, and on eBay through Greattoning.
rainbowroosie April 1, 2003
So many thoughts . . . . . . so many anecdotal stories.
I used to be the ANA Sec 25 Rep, back when they cared about such stuff. I felt it was my duty to evaluate, assess, and in some cases fully appraise collections without "a dog in the fight" . . . . . i.e. free. I have enough income streams . . .I don't need to do a number on an old lady who has only me to give her the straight story. Also . . after evaluating perhaps 50 collections over a large number of years (just did another for a friend last week) I have really only found a few interesting pieces. That is why RARE coins are RARE . . .they don't normally show up in an accumulation at the bottom of a Whitman Blue folder. I DID find an S-VDB for a fellow teacher . . . . a full original roll of 1949-S Frankies, and a 1913-S Barber Dime in AU, but the 45,000 other coins I looked at were basically spendable or melt.
However . . . . a dear and trusted friend who is a dealer was asked to look at a tube sock that had some 'coins'. His excuse is "I had no loupe and couldn't see much". A group (16) of S-Mint Barber dimes in AU55-MS63 from 1900-S-1906-S. 20 Indian Cents . . . XF-AU, but including 2 1908-S. Got the whole group for about $80. After certifying, he made about $8000 on the deal. Point? I love the guy . . . and his ethics are normally above question. Still . . this hobby really accentuates those who have knowledge from those who may not.
I prefer to stay out of it. I serve as a professional educator . . . . and whether it is English, Sports Psychology, or my hobby of numismatics . . . . . . I think I would rather have my integrity than a few bucks.
Drunner
Good vs Evil.
Due diligence
"..this hobby really accentuates those who have knowledge from those who may not."
Indeed. This should be the primary lesson learned by every budding coin collector on day one.
RMR: 'Wer, wenn ich schriee, hörte mich denn aus der Engel Ordnungen?'
CJ: 'No one!' [Ain't no angels in the coin biz]
The collector has an obligation to sell their collection before they die or he/she should have contingency plans in place upon their death. If a collector has hundreds/thousands of raw or low value slabbed coins I don’t see too many good endings.
The best way around this in my humble opinion is to tell your heirs that they need to understand a couple of things.
First it's a negotiating game between them and the dealer(s). The dealer is trying to get the collection as cheap as possible to maximize his or her return. That's their job. The heir is trying to get as much as they can from the inheritance. Be patient, no one is twisting anyone's arm to accept the first offer.
Second, they will need to work and do some research if they want to maximize their windfall. If they don't want to waste a lot of time and do a bunch of research then I would recommend they go to a good coin show. A large regional or national show if possible. This way they will get many offers (lowballs & decent) in a short period of time that they can compare without wasting weeks or months going to local shops.
You have to work for the extra money and shop things around. If your lazy or don't want to do any work you will get less. I did that with my coins 25 years ago and more recently with my PSA graded cards, where I was lazy and accepted less because I did not want to waste my time (which was/is more important to me) then shopping my coins and cards around to get the best deal.
I've explained this to my heirs. If they want more out of my collection they can do a little work for it and hopefully I've given them enough info that they will know what to do.
Edited for grammar.
Donato
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IT IS WHAT IT IS and something will NEVER CHANGE
If your dead who cares?
Don't you care about Linde?
Worry is the interest you pay on a debt you may not owe.
If you care for something take care of it and nurture it, educate those you care about i.e. heirs.
People are generally in a hurry to dispose of inherited material. They don't do much if any research. It just Dad's hobby stuff. It's a shame for sure that they are so lazy.
My Realtor called me one day and said he's working with two kids who inherited Mom and Dads home here in my neighborhood. Said they also got some coins that they needed to be rid of. I met him and them at the house and found two very competent, educated and managerial type kids. Sharp as tacks. In their 50's.
They pulled the coins out and I proceeded to go through them, writing it all down on a yellow pad...da da da da.
The collections was small and typical with a few silver dollars, lots of Kennedy's, tons of wheaties, some Red seal paper, etc etc. Nothing of real value, nothing rare, scarce or such.
Then I went to the gold. Modern AGE's from 1/10 to 1/2 oz. No boxes, no paperwork, just about a dozen or so pieces. I was giving prices as we went along. The prices on the gold floored them and they could not believe that a little gold coin was worth $125! She commented and he agreed that they figured a few bucks each on the gold! When all was said and done they had smiles on their faces and I was pleased as well. I don't know what my local shop would have done and won't speculate, but what I do know is that it was really easy to see they knew nothing of coins or silver and gold. NOTHING. It would have been soooo easy to cheat the heck out of them and they would have still had smiles.
I sleep well at night.
bob
So, since they are ignorant of pricing and value, they spend money to get something graded that isn't even worth the grading fees. How is that good for them?
I work in a camera store that deals with used equipment all the time. We try to be fair and pay a good price for stuff, but at the same time we are the ones taking on the risk as well. We have overhead of course, plus with used equipment there is always the chance we will have to pay for repairs since we offer a warranty. Some things also move much quicker. If we can flip it fast we don't need to make as much on the item, if it is going to sit for months waiting for that one buyer that wants it, we need to make a little more to compensate for our money being tied up for months at a time. Generally common sense things, at least if you are used to running a business.
I agree though that it's hard to have sympathy for people when they don't take the 10 minutes to type in the name of their item on eBay and see what it sells for. Usually it's the opposite problem, they don't recognize the difference between what people are asking for an item, vs what they actually sell for. In that case though, they should assume it's more valuable, not less! If they aren't going to take the couple minutes to do the barest minimum of research, well that's their fault.
As far as being a customer in a store and over hearing things, my advice is generally to just stay out of it. Nothing pisses us off more when people interrupt our dealings with fellow customers. I know often they are trying to be helpful but that's rarely the case. I had one customer that interrupted to tell the person they could get more money on eBay. After the people left he asked if we had a couple cameras he could look at. I said no sorry, they're all on eBay. He got the point. I had another customer that was completely pissed and accused me of trying to take advantage of her. I'd told her we were not interested in her camera and would not buy it. Another customer was in the store and interrupted to call her out and ask her how exactly we were taking advantage of her when we said no and made no offer! I didn't mind the customer chiming in that time
Collector of randomness. Photographer at PCGS. Lover of Harry Potter.
You wanna know horror stories.......just go ask crazyhounddog. He can tell you horror stories about the dealer in his area. We aren't talking about a coin worth 100 and a dealer offering 60-80, were talking about straight up ripping them off.
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I'm gonna stick to guns. I seem to miss with a lot more posts than shots.
I do understand topstuf. He is saying that if a person inherits raw stuff and has the presence of mind to get them graded, then that particular person is probably going to learn other things along the way too, which should help them when/if they get a low ball bid.
One would hope that is so, but having slabbed Coins is still no vaccination against low-ball bids.
I find myself in agreement with topstuf almost always, but sometimes I gotta read his posts several times over.
I despise spellchecker.
Average $70 sounds fair to me. Stamps are often bought for less than 20% of their catalog value. We are possibly forgetting that the hoarded, coin accumulator, and collector probably had lots of enjoyment from his stuff. When dead,, he has no control over it even if he left appraisals, and notes on his costs, or even slabs.
At this point in time, NO ONE can tell someone what to offer for a coin. "They" have made attempts to control what things should be sold for by prosecuting folks who have gone well over the limits - even past the TV sales.
As with so many things in life, the answer is education.
If you can’t be bothered, I don’t feel sorry for you.
Some people are legitimately hindered in this regard (emotional distress, learning disabilities, low IQ, mental illness, dementia) and this is where solid ethics ethics are the last defense.
if you inherit a collection and don't know anything about coins it will be hard to know what to have encapsulated. I think that is poor advice to give someone.
When many offer 40% percent back of bid (or whatever they call it now) for decent certified coins, what did you expect the numbers would look like for raw coins?
Ah, 60% back?
=
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Not QUITE exactly. My premise was that if a deceased COLLECTOR had been one who collected slabbed coins ....or... had his coins slabbed. HE (or she) would ...PROBABLY.... be one who cared enough about his (or her
) collection to take steps to prevent his heirs from being ....."ripped."
At least I ...think... that's what I meant.
I have to rewind my brain every 3 hours.
I am not suggesting that any appreciable number of inheritors of raw coins would have either the knowledge or foresight to have the remains slabbed....
POST MORTEM... heh
Agreed, Smudge, and sadly most heir don't care.
If you walk into a store with a flashy dipped-out 1896 $1 NGC PF67CAM, the discounted value from a PCGS PR67CAM CAC could easily be 40% or more. The same two coins raw and the spread is even wider. In a shop and an auction and on the bourse floor too. True in a significant number of different series across multiple grade ranges.
On the raw coin vs. certified coin (assuming PCGS, NGC and/or cac); remember that PCGS ad a few years ago, about a raw coin vs. certified as "wishful thinking" in terms of pricing? It really comes down to accurate pricing and how can you do that with a raw rare coin which may go 65, 66, or 67 when the dealer does not want to stick their neck out and make offers accordingly? And then there are Anacs or ICG certfied coins that you don't know whether they will cross or not into real market grades--Heritage and other major dealers regard those as "raw" coins.
PMG dealers are supposed to adhere to good ethics on buying coins: "To refrain from any of the following in dealing with non-professional customers: (a) buying or selling at unreasonable prices." https://pngdealers.org/code-of-ethics/
Many inheritors and sellers that go into shops do not have analytical minds. May not have the rational faculties to assess value on an esoteric area like collectible coins even with the internet and other tools. Some are "old school" and don't do much with tech. anyway. People get a referral to a certain dealer that they are "highly recommended" even if they don't follow rigorous pricing before buying since grading is an art not a science anyway according to some.
One way I have heard dealers handling it is buying them with conditions on how they grade, and selling them through GC for example, and working on a percentage, 10-20% or so.