Everything you thought you knew about pawn shops is wrong.
The rich use high-end pawn shops to pawn or sell Andy Warhol art and 13th-century swords.
More common than these pawn shops are the average pawn shops that cater to people who are looking for pawn loans around $150. Yet, depending on the item, the loan can go as high as several thousand dollars.
Before you think about pawning, it’s a good idea to understand how pawn shops work. Read on for the ultimate guide on everything you need to know about pawning.
How Pawn Shops Work
Pawn shops offer pawn loans to people who need cash. You bring in an object you own. If the pawnbroker is interested, he or she will offer you a loan amount.
Pawn shops take a variety of items. From Playstations to power tools and everything in between.
The pawn shop keeps your item until you pay the loan. Typically, pawn loans are for less than the full value of the item. Your loan will be good for a set period of time, usually one to four months.
The pawn shop will give you a pawn ticket. This is your receipt of the transaction. You need to keep this paper in order to repay the loan and get your item back.
If you use an online pawn shop, you have an account. In these cases, you don’t need a pawn ticket.
Pawnshops sometimes buy items as well. In this case, you don’t have a loan and are parting with your item for good.
Repaying the Pawn Loan
When you are ready, you can pay back the pawn loan in one of two ways.
First, you can return to the pawn shop and pay your loan plus any fees before the loan deadline. The pawn shop will then return your item to you.
Or, you can choose not to repay the loan. In this case, the pawnshop keeps your item to sell it to another customer at a profit.
This option has no negative consequences for you. You won’t get an overdue notice in the mail or be sent to collections.
Some pawn shops will allow you to extend your loan period for an extra fee. You can do this if you need more time to pay the loan.
Now you know how pawn shops work!
Pawning is a great way to get a quick influx of cash with little risk. You don’t need a credit check and the loans are instantaneous.
Pawn shops are also easy places to sell your items without the hassle of the consignment. The benefits of buying and selling at a pawn shop are endless!
At PawnGuru, we pawn, buy and sell. Want to know how much an item is worth? Select a category and we’ll tell you!