How to Deal With Coin Dealers

Understand supply and demand. The more in demand a coin is, the higher the value it has. This typically relates to the supply, because if a certain type of coin is widely available, dealers will lower the price to keep it competitive. Visit online coin collecting resources or books to determine the rarity of a coin before you work with a coin dealer on buying or selling.

Learn about the grading system for coins. Dealers will assign coin values based on condition. In the poorest condition, a coin's details, such as the date, are hard to discern, but in a mintstate coin, the details look like they did when the mint first made it. To understand the grading system some dealers use, look at Sheldon's numerical system, which assigns a numercial value from 1 to 70, with numbers 60 to 70 reserved for mintstate coins.

Consider the circulation status for your coin. A circulated coin is one the mint released into public circulation, giving it a classification of used. The coin gets passed from person to person and vendor to vendor, incurring more damage than uncirculated coins. An uncirculated coin, also called a mintstate coin or a new coin, is one the mint sells directly to a coin collector. In most cases, uncirculated coins aren't used as legal tender.

Understand how coin dealers buy coins to identify the best negotiation techniques. Some dealers own a storefront and attend events where they offer to buy your coins for a set sum. Others work as middlemen and collect a set percentage from the sale as commission. For selling to dealers paying an upfront sum, try to get the highest amount possible for the coin. With commission dealers, you may be able to negotiate the amount of commission to increase your take of the sale.

Research a dealer's reputation. There are a few associations for coin dealers, including the American Numismatic Association and the American Numismatic Society. Most reputable dealers belong to an association. Also consider how long the dealer has been in business. If possible, get references and talk to people who have dealt with the dealer on an ongoing basis.

Get a second opinion. Before you make a deal with a coin dealer, talk to other dealers. You want to get the highest price for your coin if you're selling and the lowest price if you're buying. Use a quote from one dealer to determine whether another dealer will negotiate to be competitive in price.

Check the paperwork that comes with the coins. Most dealers provide documentation stating the value and the condition of the coin. Any coin of value to a collection should have some type of paperwork, even if it's just an indication of the coin's grade. For rare coins, the documentation should provide authentication for the coin. Inspect the documentation prior to completing your transaction.