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The mistakes gold sellers make most often, and how you can avoid getting the "golden fleece"

7:12 PM, Dec 17, 2009   |    comments
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As the price of gold remains stable in the midst of an unstable economy, some consumers are digging in their jewelry boxes hoping to turn gold into cash for the holidays.

Unless you are a jeweler, it is easy to mistake a treasure for a worthless trinket or vice versa.  But there are a few things you can do to get the most out of your old jewelry.

"I see a lot of people that have, this might be their second time selling, and the first time they realize that they made a mistake," Knox Gold Exchange Co-owner Leanne Murphy said.

Brian and Leanne Murphy own the Knox Gold Exchange in Powell.  They're seeing a rise in customers searching for green for their gold.

"When you see the market saying $1,100 for gold per ounce, that's for 24 karat pure gold," Brian Murphy said.

However, most gold is a mixture of metals and is usually between 10 to 18 karats.

The Murphys use the jewelry to do a scratch test on a stone. Then they use nitric acid on the stone to determine the jewelry's value.

"If I use the 14 kt acid, and it's 14 kt gold, it should stay clear. If I use a stronger acid because the material has less gold content, it will fade and disappear," Brian said.

Gold is weighed by grams or penny weights.  Murphy says customers should watch the entire process and ask to see the scale.

Consumers should not let jewelers apply chemicals to their jewelry to test it or take it apart to weigh it.

"It would be like removing the stones out of their rings to weigh it up and find out what it's worth, and then if they decide not to do it, all their stones and their jewelry is destroyed," Brian said.

Sellers should also shop around.

A WBIR staffer went to three local jewelers with a 30-inch, 14 kt gold chain and medallion.

The high end jewelry store offered $700. A cash for gold business offered $800. Knox Gold Exchange paid $1,100.

The Murphys say research pays off. They recommend going online to research consumer feedback and calling businesses to get detailed information. 

Leanne Murphy says if buyers aren't forthcoming on the phone, they won't be transparent in person either.      

"It's really important that you're speaking to somebody who is giving you the most information that they could possibly give you over the phone," Leanne Murphy said.

On another note, the Murphys say reputable businesses have to report every gold exchange to the police department to make sure it isn't stolen.

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