This might seem like a silly question to people that understand what pawnshops do and what pawnshops really are.
That having been said not everyone has a pawn shop in the past nor do they know exactly what it is that pawn shops do on a daily basis.
For a lot of people they just think of pawnshops as places were you go to sell things or turn around and buy them.
While it is true that you can sell things at a pawn shop and that you can buy things in their retail spaces, pawnshops exist for an entirely different reason.
When we are talking about a pawn shop what we are talking about are pawns themselves.
The pawn is otherwise known as a “Pawn loan,” that is a temporary loan made against some items that you bring into the pawn shop as collateral for that loan.
The pawn shop will hang onto these items to secure the loan. When you are able to pay back the loan, plus any interest attached to that loan, the pawn shop will give you back the items that you brought it in the same condition that you brought them in as.
Are Pawn Loans Affordable
Pawn loans are extremely affordable.
The interest rate attached to pawn loans are regulated on a state-by-state basis. While it is true there are some states where pawn loans are more expensive, or that is that they charge a higher interest rate, oftentimes pawn loans are going to be a much more affordable option that something like a cash advance, or payday loan.
Pawn loans are often sought out by individuals who can’t get loans through other traditional sources such as banks or secondary lending institutions.
Additionally pawn loans provide you a great degree of flexibility depending on the state that you reside in.
Most states give you at least 30 days to pay back the loan, with many states giving up two 90-120 days to pay back the loan at minimum.
In addition if you make your interest payments on a regular basis you can often extend the loans is often and as frequently as you need to for as long as you need to until you are able to afford to pay back the principal balance of the loan and get your items back.
Are Pawn Loans Safe
Pawn loans are extremely safe in most cases. It is the responsibility of the pawnbroker to ensure that your items are safely and securely stored while you have them in on loan.
In addition to that, should you forfeit on the pawn loan you are protected by the fact that they are known as “No recourse” loans.
What that means is if you cannot afford to pay back the loan, the pawn shop won’t turn around and sue you at a later date.
Because of that there is really no risk in making a pawn loan other than the possibility of losing your item should you not be able to afford to pay back the loan.
There’s no risk to your credit record or other financial statements based on pawn loans either.
How Easy Is It To Get A Pawn Loan
Pawn loans are extremely easy to get. They are purely based on the materials, or merchandise, that you bring into the pawnshop to make a loan with.
The amount that you get loan will he determined by the value of your items, in their current condition, when compared to the used market place for those items.
Often times these comparisons are made on sites like eBay and Amazon.
In the case of precious metals, the price will be mostly determine by the current spot price of that metal per troy ounce.
Making a pawn loan will usually take you less than 5 to 10 minutes to complete.