Bonded?

[xsscx]

I have read that you should buy only bomded diamonds. What is a bonded diamond and is this true?

 

[niceice]

Perhaps the person advising you is referring to diamonds which have been graded by an independent gemological laboratory such as the GIA, AGS or HRD... People often incorrectly refer to lab graded diamonds as being "certified" which is incorrect because the labs are not certifying anything, but rather stating what they believe to be the characteristics of the diamond at the time of grading.

 

[optimized]

I remember hearing about bonded diamonds a while ago. They are pitched heavily by Diamond Cutters International, which I think I can safely assert does NOT enjoy a good reputation here on the forums. "Crook," "scammer" and "convicted felon" are expressions that have been bandied about within the same threads that discuss Mr. Cuellar and his company. Do a search for some of the keywords for more info ("bonded," "cutters" or "fred" will yield lots of info here in the forums).

Anyway, a "bonded" diamond (as described by Mr. Cuellar) is ostensibly a diamond with a bulletproof warranty attached to it. A bonded diamond is supposed to be (among other things) warranted against breakage (free replacement), have a lifetime exchange/trade-in guarantee, be guaranteed to be untreated "natural" diamond, and to even have a "market crash" guarantee that would reimburse you if the diamond ever loses value due to a diamond market crash.

To me, that last one is a huge red flag that screams SCAM to me. What kind of a legitimate business offers such risky assurances? It's a swell idea, but my guess would be that if the market ever crashed, the bonded diamond dealer would be the first one in line at the courthouse to file their bankruptcy protection paperwork, having had the documents at the ready since the day they started offering bonded stones.

Anyway, since bonded diamonds seem to be more expensive than non-bonded diamonds I would avoid them. The benefits are sketchy at best, and in reality many of the supposed perks are already offered by many dealers (trade-in policies, untreated stones, etc.) without the shadiness that seems to accompany the bonded stones.

My $0.02...

-Tim

 

[pricescope]

Xsscx, you probably read about bonded diamonds in Fred Cuellar book. You also might have read about "warped" diamonds.

It is done to scare you and to make you buying only from Fred.

Basically, it's like buying a diamond with extended warranty. It might give you an extra piece of mind but you also have to pay extra for it. You also have to read the fine print in the agreement.

To make a decision you have to educate yourself and compare prices for similar diamonds.

Also try to search for Fred Cuellar on this forum.

 

[niceice]

Fred Cuellar again? How come every time we hear his name we start to think of hosting a book burning beach party?

 

[pricescope]

Fred discribes it like this:

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For starters, only approximately 5% of the jewelers in the world are bonded. Only 1 out of every 20! By "bonded", I'm referring to the fact that they sell bonded diamonds, and bonded diamonds my friend, are the way to go if you can afford them. They typically run 10-15% above non-bonded diamonds. A bonded diamond is just a fancy way of describing a fully warranted diamond.

This is what you get when you buy a bonded diamond:

1. All bonded diamonds come with a lifetime breakage policy. You bust the stone; the jeweler gives you a new one. (One bust per customer) This is a wonderful policy. Since treated stones tend to be brittle. No jeweler would give you this guarantee unless your diamond is 100% natural.

2. And you're going to love this: all bonded stones come with a lifetime buy back policy. Translation, for the life of the diamond, you can take it back to the jewelers and get 100% of your money back on the diamond!! (Mountings and sales tax not included) How wonderful is this! If you're not 100% satisfied for the life of your purchase you get your money back. Now you might ask, "How can a jeweler afford to do this?" How can he not? Great diamonds are in demand, very liquid and easy to resell. Any jeweler worth his salt will be glad to buy back a good diamond. If a jeweler doesn't want to buy back your diamond, then there was probably something wrong with it in the first place.

3. All bonded diamonds come with an unconditional lifetime exchange policy. This is great! If your fiancee ever gets bored with her shape, your jeweler will allow even exchanges. (You have to pay for resetting fees.)

4. Bonded diamonds come with a lifetime trade-in policy with a fixed appreciation rate to keep up with inflation.

5. Bonded diamonds come with a market crash protection policy. If the diamond market ever crashes and your diamond depreciates, the jeweler will refund the difference between what you paid from the new market value.

6. All bonded stones are guaranteed to be natural and untreated.
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So you are paying 10%-15% more (interesting to compare though) to have 100% lifetime return and market crush policy. Latter is questionable because if market will crash who will guarantee the bonded jeweler will still be in business.

The rest of the bonded conditions can be found if you're buying elsewhere without paying 10%-15% extra.

When I bought a TV, the sales guy tried hard to sell me extended warranty. I refused. Next year their nation wide company went out of business. My TV is still working ok.

I read these companies are making more on extended warrantees than on selling the goods.

Internet vendors often work for 5%-10% margin. I assume extra 10%-15% will make a big difference in price.

 

[Iceman]

Its easy when I can sell diamonds locally here for $2,600 and Helzberg in the Mall was selling the same thing for $6,000! they could replace it two times over , actually 2.3 times over. Then you know they well find a loop hole when it comes time to collect.