Well here is one of those questions that I get all the time and I can’t really blame anyone for asking it because it seems like a pretty important question to have if you are thinking about pawning something for a short term loan.
That is, to be specific, how much do pawn shops offer for you items and how do they figure out those prices?
Well, before I get to the meat and potatoes of that answer, lets first talk about the fact that pawn shops typically aren’t large retail chain or big box stores with heavily established guidelines and practices that everyone follows like a robot.
Pawn shops are typically owned by small independent business owners and they are all going to operate a little differently. They will slightly different rules and practices that they follow for establishing just how much they are willing to offer you for your merchandise or against your valuables.
So with that in mind, let’s talk about some very basic principles that a lot of pawn shops and pawn brokers may follow when attempting to establish an accurate used value for your items and determining just how much they can offer you for a loan or as a sale for your item(s).
How much pawn shops offer you will depend on the items you bring in and what the potential resale value of them is.
How Pawn Shops Figure Out Prices
Okay, a lot of this is going to depend on what kind of items that you bring into the pawn shop to begin with as there are a lot of different little rules that they may follow to come up with accurate prices for the used value of your merchandise. Let’s take a couple different examples and work with those to explain the whole process.
Gold Jewelry – Okay, lets talk about something that is made out of gold. How do pawn shops figure out how much they can offer against that?
Well, gold as a precious metal is traded on the open market and a commodity that you can buy and trade around a fixed market price.
Now the price of gold moves every minute of every day for the most part. It goes up and down and is established by demand and the strength of your local currency. Lately the price of gold has been pretty high so that works in your favor.
What a pawn broker is going to do is weigh your item and determine based on it’s weight and the karat of the metal just how much actual gold is there. Based on that amount they will determine a figure that they can loan you and that will typically be based around 40-60% of the market value of the gold which is a pretty common industry standard.
Some pawn shops may pay more, just like some pawn shops may pay less but you can typically figure that average as a good estimate for what you can expect on gold overall.
Now if there are diamonds involved then they are going to figure into the entire calculation depending on their size, color and clarity. Obviously one bigger diamond is going to worth a lot more than a bunch of smaller stones of equal weight because when it comes to diamonds, the small stones don’t really matter too much – they are everywhere.
So if you have a ring with “2 Carats Of Diamonds” in it but they are all 1 and 2 point stones, it won’t mean much. If however you have a ring with a single 2 Carat Solitaire, that is going to be worth quite a bit!
Consumer Goods – Now let’s take another item for instance like smaller consumer goods and electronics.
These are a lot easier for pawn shops to work with because all they need to do is establish a valid used, 2nd hand value for those items in similar condition and completeness.
To do this most pawn shops have learned to use sites like eBay and Amazon to see what items just like yours have sold for in the past and established a good idea what they would be able to sell you item for if you had to forfeit it or if you just sold it outright.
Now once they have this value and pawn shops will typically offer you between 40-60% of that value depending on what it is and whether or not you were making a loan on it versus selling it.
If you are making a loan on an item, there are additional costs involved in holding and storing your item so pawn shops will probably offer you something close to the 40-50% range for your items.
However if you are just selling your items outright then you might expect to get something along the lines of 50-60% for your merchandise because the pawn shop will know exactly what it’s cost is when it buys your item and there are no additional storage expenses that they have to worry about.
The Bottom Line
A pawn shop has to figure out what they could potential sell your item for before they can figure out how much they can offer you on a loan or for a sale on it.
They will then take that value and offer you a percentage of it, something between 40-60% give or take.
As always, because pawn shops are operated by a lot of individual pawn brokers, you can expect these prices and practices to vary somewhat. That’s just the nature of this industry but you can use this information as a guideline for what you might expect to be offered for your items when you take them into the local pawn shop in your area.
Mandy Dormain started working for Pawn Nerd in 2020. Mandy grew up in a small town in northern Tennessee. But moved to New York for university. Before joining Pawn Nerd, Mandy briefly worked as a freelance journalist for several radio stations. She covers politics and economy stories.
