If you want to know what it is that a pawn shop charges for a cash loan, this is actually something that is very easy to find out.
The first thing that you need to know is that the fees and interest associated with cash loans from pawn shops are regulated by state and local laws in your area.
It is not as if pawn shops just make up these fees and interest rates as they go.
In fact on shops are so tightly regulated in most states that any deviation from the laws specifically prohibited.
That having been said, in higher interest states, it is not uncommon for pawn shops to offer their customers a rate that is below the state limit in an attempt to steal customers away from their competition.
This is perfectly fair, and is a common practice depending on how competitive the pawn market is an area in which you live.
That having been said, don’t plan on this being the case.
Most pawn shops across the country will keep their interest rates even across their entire customer base so as to not show favoritism to any one customer.
Additionally, this simplifies the process of calculating fees and charges for all customers as there are no individual deviations among the customer base.
Taking all of this in mind, there are a variety of fees and associated costs that a pawn shop may be able to charge you when you are getting a cash loan from them.
What Are Some Of The Fees That A Pawn Shop May Charge You When You Get A Cash Loan From Them
You have to understand that all of the fees and charges that a pawn shop charges for a cash loan is completely dependent on state laws in your area.
Because of that, these fees and charges are going to be standardized across all of the pawn shops that you may work with.
Some of the fees that pawn shops may charge can be things such as a set up or initialization fee.
Typically, this fee is a one time fee that you can charge upfront and will pay the first month of the loan as an expense associated with originating the loan, or doing the initial paperwork for the loan itself.
This can otherwise be thought of as a filing fee. It’s just a way that a pawn shop compensates for the time associated with inspecting your items and setting up the paperwork for the loan.
Another fee that a pawn shop might be able to charge you for a cash loan is what is known as a storage fee.
A storage fee will typically be charged on a monthly basis and will not often exceed four or five dollars a month depending on what the state laws in your area set forth.
This is a fee that is associated with the cost of storing your items safely while they are in on loan at the pawn shop.
Another fee that a pawn shop may be able to charge you is what is known as a ticket fee.
A ticket fee will often be charged if you lose your original consulate report ticket and need a replacement. This fee is usually not more than a couple dollars and is simply to reimburse the pawn shop for the cost of replacing your ticket.
Then of course, there is always the interest fee. This is the percentage that a pawn shop charges you on the principle of your loan, which is the amount of money that you borrow.
Interest rates can vary from 2% up to 25% depending on state. What that means is depending on where you live for every hundred dollars you borrow you may be paying between $2 and $25 a month for the loan.
So Is Getting A Cash Loan From A Pawn Shop Truly An Affordable Option
The truth of the matter is, that cash loans from pawn shops are some of the most affordable short-term loans that you will find on the market today.
They are often much more affordable than cash advances. They are much more affordable than payday loans or other forms of consumer finance loans.
That having been said, the amount that you pay for your cash loan at a pawn shop will be completely dependent on the state and local laws in your area.
If you happen to live in an area that allows pawn shops to charge a high interest rate, then it is suggested that you shop around to see if a pawn shop will offer you a better rate than their competitors.
WordPress junkie, music lover, and consumer of all things pizza-oriented. I’ve run pawn shops and check cashing operations for years. I developed the most successful digital marketing marketing strategy for pawn shops known to date, and flip items on eBay for fun.