Perhaps you’ve heard of a pawn loan or maybe you haven’t. To give you a basic idea, a pawn loan is essentially a way to borrow money from a pawn shop. Rarely are there credit checks or hassles involved as when you borrow from a bank. But many people are skeptical of pawn loans; this is because if you do not choose carefully it is easy to be scammed. So here’s some info on what pawn loans are and how they work.
We live in a time where the economy is not the best and money is losing its value. That’s how a pawn loan could be helpful to you.
Pawn Loans are a simple way to get cash you need. There are no credit checks or loan applications and you use the valuables you already have in your home for an instant cash loan. Just because you have valuables doesn’t mean you are quite ready to part with them and you may not be ready to sell; this is where a pawn loan can be useful.
Most pawn shops use a three step process:
- Bring your valuables
- Receive a quote from a professional within minutes
- Get your cash
Depending on state laws, typical pawn loans may have a term length of a month and a grace period to pay back the loan with interest, while others offer as long as 4 months. They will store your item in a safe, secure location for the duration of your loan. By repaying your loan plus interest in full on or before the expiration of the loan period, you can reclaim your item.
Also depending on the pawn shop you work with they may offer you extra time, and if you decide you do not want your valuables back, you can surrender them to the shop. This all depends on the pawn shop you use and where you live.
So what types of items do pawn shops accept for loans?
- Jewelry (Diamond Rings, Watches, Bracelets, Earrings, etc)
- Electronics (TVs, Laptops, Projectors, iPods, Cell phones, etc)
- Antiques & Collectibles (Paintings, Memorabilia, Medals, etc)
It’s important to remember that if you work with a reputable pawn shop, your items will be stored in a safe and secure location, so you don’t have to worry about something happening to them while being stored.
The money you receive will depend on the appraisal value of the item. For example, if it’s a TV, the item would be evaluated based on a number of factors, including age, condition, etc. It’s possible to do a little research ahead of time to get the best price for your item. Another example is jewelry; this has to be evaluated differently. Many pawn shops have techniques such as scales and tools they use to check for authenticity and the current value.
It’s important that the condition is always taken into consideration. General merchandise will be tested to ensure it’s in working condition. For example, using a TV again, the pawn shop will likely do more than just look at the physical appearance. They will plug it in and turn it on then take note of any accessories, such as a remote.
The better the condition of the item, the more money you are loaned. Testing and evaluating items are beneficial to you and for the pawn shop.
Remember to research your area for pawn shops. Use the internet as your friend and read reviews on pawn shops as well. Ultimately with pawn loans you get the cash you need right away and you are able to keep your personal items.
Ashlyn Kirk lives in Atlanta, Georgia and is a recent graduate from The University of West Georgia. She loves writing for The Gold Standard as her interests range from jewelry to electronics.
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