Why would someone go to a pawnshop to get a loan?
Response: Pawnshops offer the consumer a quick, convenient and confidential way to borrow money. A short-term cash need can be met with no credit check or legal consequences if the loan is not repaid. A customer receives a percentage of the value the broker believes the collateral would bring in a sale. Although the loan-to-collateral ratio varies over time and across pawnshops, a loan of about 50 percent of the resale value of the collateral is typical. In other words, pawnbrokers feel their loan is “paid in full” at the time it is made. When a customer pawns an item, the terms of the loan are printed on a pawn ticket that is given to the customer. The ticket states the customer’s name, address, type of identification provided to the pawnbroker, a description of the item, amount lent, maturity date, interest rate and amount that must be paid to redeem the item. Most states regulate pawnshop interest rates and other charges, such as storage or insurance fees.
• What is the foreclosure procedure? • Do most pawning customers lose their merchandise? • How can I be sure the merchandise I purchase at a pawnshop isn’t stolen? • Are there firearms in pawnshops? • Are pawnshop rates excessive? How does a pawnshop work? Pawnbrokers lend money on items of value ranging from gold and diamond jewelry to household items, etc. Items such as jewelry maintain their value over a reasonable period of time. Customers provide collateral, eliminating the need to distinguish high risk from low risk borrowers. Typically, loans are small but can reach as high as several thousand dollars depending on the value of the collateral. Contracts vary from state to state, but the average loan period is 90 days. Interest rates will vary with the amount of the loan. The process is much the same as any other lending institution, with the primary difference being the size of the loan, the collateral and the holding of the merchandise until the interest or the loan has been rep
Pawnshops offer the consumer a quick, convenient and confidential way to borrow money. A customer receives a percentage of the value the broker believes the collateral would bring in a sale. Although the loan to collateral ratio varies over time and across pawnshops, a loan of about 50 percent of the resale value of the collateral is typical. In other words, pawnbrokers feel their loan is “paid in full” at the time it is made. Most states regulate pawnshop interest rates and other charges, such as storage or insurance fees.
Pawnshops offer the consumer a quick, convenient and confidential way to borrow money. A short-term cash need can be met with no credit check or legal consequences if the loan is not repaid. A customer receives a percentage of the value the broker believes the collateral would bring in a sale. Although the loan to collateral ratio varies over time and across pawnshops, a loan of about 50 percent of the resale value of the collateral is typical. In other words, pawnbrokers feel their loan is “paid in full'” at the time it is made. When a customer pawns an item, terms of the loan are printed on a pawn ticket that is given to the customer. The ticket states the customers name, address, type of identification provided to the pawnbroker, a description of the item, amount lent, maturity date, interest rate and amount that must be paid to redeem the item. Most states regulate pawnshop interest rates and other charges, such as storage or insurance fees.
Pawnshops offer the consumer a quick, convenient and confidential way to borrow money. A customer receives a percentage of the value the pawnbroker believes the collateral would bring in a sale. Also you decide how long to keep the loan, if you want longer than 30 days, you just have to pay the storage fee due.
