The trouble with problem rare American coins or world gold coins is that, as the name suggests, they have problems. They have been tampered with in a variety of ways that makes them less than desirable to most collectors.
They have nicks and dings in the rim, or have been scratched, polished, bent, drilled or tampered with along the way at a time when they had no more than their monetary value. They also sometimes have paint, glue, food, grease, tape residue, or some other unidentifiable material on the surface.
This discussion leads me to ask, does a “bad penny” constitute a problem coin? That one I’ll leave open for future debate.
I consider coins made into jewelry to also constitute problem coins. I will pick these up for less than bullion cost, because the seller doesn’t know any better. I then remove the chain or however it was adapted to become jewelry and toss the altered coin in my bullion tube for future disposal.
I fix some low-value coins, silver eagles, or problem bullion coins, because fixing things is in my nature. I’ll buy those troubled coins only if the price is low enough, so I can fix them and throw them in the bullion pile.
I often buy what I consider problem coins at auction and won’t pay very much for them. I am always amazed at how much some people will pay for coins with issues that I consider as having minimal value.
I never expect to appreciably increase the value of a coin with a problem, but it is fun for me to see if I can do anything to give a coin more eye appeal. I’ll remove surface contamination with solvents for example.
Polished rare US gold or silver coins, can have their surfaces returned to a satiny finish, but they will never look mint original. Light scratches can be removed, but not deep ones. I can mitigate some rim damage, but I can’t repair it.
I have never added enough value to a problem coin that would make it worth my time to remove the offense from it. I enjoy the challenge. The coins I keep in my collection are trouble-free to begin with. I enjoy their beauty and admire their easy life.
The biggest trouble with problem coins is the major grading services won’t grade them. They just return them in body bags and charge you as if they had graded them. Sometimes it’s hard for an inexperienced collector to tell there was even a problem with the coin they decide is un-gradable.
The next biggest problem with troubled coins is that they are difficult to sell. You can get them at a bargain price, and when you decide to sell you won’t get any more than a bargain price for them.
Is it worth it to fill a hole in your collection? If the place holder is a rare American coin with an obvious problem, will you eventually want a nice one to replace it? That’s up to you. In my case, I’m holding out for the suitable rare issue coin, and I’ll get a nice version of the really expensive coin missing from an otherwise complete collection.
In the end, my advice is like everyone else’s. Spend more money for a better coin and enjoy its beauty. Leave the problem coins for someone else’s collection.
If your heart goes out to the orphan coins of this world, please adopt them. That’s OK too. But know what you have and why you have them. Don’t be fooled into thinking they’re worth more than they really are.
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If you are interested in learning more about rare American coin, or foreign coin collecting and investing see NumisMaster from Krause Publications.