Remember That Prices Are Negotiable
Pawnbrokers have the luxury of choosing their prices and appraisals, and you have the privilege to negotiate. Your item is ultimately yours to decide what to do with, and most pawnbrokers are respectful of your decision.
If a pawnbroker offers you an amount far below your items estimated value, you can counteract that offer with a higher value and support your claim using research or documentation. The pawnbroker will work with you until you come to a dollar amount thats fair to both parties.
You Can Pawn Almost Anything
Interior of a pawn shop | PawnGuru
Guns and gold might be some of the more common items people think of pawning when they need some cash, but in theory, you can pawn almost anything. You just need to find a pawn shop that thinks it would be able to sell your stuff. Different stores specialize in different types of items, which is one reason to shop around using PawnGuru. Not every store might be interested in what youre offering or have the knowledge to give you a fair price.
Although pawn shops are interested in anything of value they can eventually sell, some categories of items do tend to do better than others. I would say that jewelry, musical instruments, and game consoles plus high-end electronics that arent phones do well, whereas digital accessories and electronics that go obsolete really quick dont do so hot, Birnholtz said.
Many Pawn Shop Users Are Unemployed
A recent PawnGuru survey confirmed what many people probably assumed about pawn shop users: A significant number are unemployed or underemployed. Fewer than half of pawn shop customers had full-time jobs, the survey found. Young and old pawn shop users were most likely to be out of work. Forty-seven percent of people over 50 who used pawn shops were unemployed, while 42% of those between 18 and 25 didnt have a job.
The same PawnGuru survey found people generally start using pawn shops at two points in their life: either when theyre relatively young or when theyre in or nearing retirement age. Some of the older first-time pawn shop users might be turning to pawning to supplement limited or fixed incomes, PawnGuru speculated.
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Understand Your Pawnbrokers Position
Most local pawnbrokers like Central Mega Pawn are experts in their communities; they know what will sell better in Ontario than in, say, Upland, Chino, or Pomona. Dont take it personally if they decline your item or offer less than you expected. You can either negotiate or ask where they think you might get more for your money.
For more information feel free to contact one of our pawn professionals at
Get A Competitive Appraisal Or Loan Amount At The Vault Jewelry And Loan
Our professional associates at The Vault Jewelry and Loan strive to reinvent the pawn shop experience. When you visit one of our seven Virginia locations, our team will get to know you and suggest the best option to get the most money in your pocket. Our prices and appraisals are flexible. Were open to negotiating a price thats fair for you and your luxury items.
Talk to one of our associates by contacting us online;or giving us a call at . We look forward to working with you!
Jamie Furman
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What Can I Pawn
How much is my stuff worth?
When we assess the value of the item we look at its current value but we make the pawn loan based on the resale value of the item. The type of item being pawned and its condition makes a difference in the loan value as well. Some of the higher value loan items include:
- Gold, high end watches and jewellery
- Up to date electronics
- Quality guitars and musical instruments
- Collectibles
These items bring higher loans, but almost any item can be pawned including household goods, entertainment systems, tools, costume jewellery, and more. The basic rule is that if it is not illegal, and we dont have to feed it or water it, we can likely give a loan on it.
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Pros Of Pawnshop Loans
- Quick funding: You can walk out of the pawnshop with the money in a matter of minutes.
- Doesnt affect your credit: You dont need good credit to get a loan. And if you dont pay, you also wont see a hit to your credit score either.
- No hassles from creditors if you dont pay: You wont be referred to collections or hounded by creditors if you dont pay the loan. In that case, the pawnbroker simply claims ownership of your pawn and sells it to recoup the cash.
Pawnshop Loans Interest Rates
Interest rates on pawnshop loans differ from shop to shop which presents them as fees.; It is more useful to compare loans in terms of annual percentage rates.; Pawnshops do charge to more than 200% for their loans.
Interest rates and other fees by pawnshops vary by state.; For example, in South Carolina, the APR can range from 65.40% on a $15,000 loan to 300.00% on a $50 loan.; Thats on top to the financing charge, which normally ranges from $817.50 to $12.50 for those amounts, respectively.
The State of Indiana capped the interest rate at 35% PR or 3% per month.; However, pawnshops can charge an additional 20%-monthly service charge.; Effectively, the allowable finance charge can reach 23% per month.
Thats far higher than what traditional lenders charge but its still better than payday loans and car title loans.; They normally top 400% APR or more.; Also, theres no risk of affecting your credit score or experiencing harassment from debt collectors or lawsuits.
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Its Not Like What You See On Pawn Stars
Rick Harrison from Pawn Stars examines a piece of jewelry. | Ethan Miller/Getty Images
Pawn shops might not be the dens of vice some think they are, but theyre also not quite like what you see on TV shows, such as Pawn Stars. The mega-popular History Channel program thrust pawn shops into the spotlight and helped normalize pawning, Birnholtz said. The scenes you see on the show, however, are unlikely to play out in your neighborhood pawn shop, which is more likely to be stocked with gold jewelry, electronics, and gently used musical instruments than rare rock memorabilia or Star Wars collectibles.
Pawn Stars is not necessarily representative of how most people use pawn shops because they deal in really, really specialized items, Birnholtz said. Theyre a big shop with probably pretty good margins, so they can afford to pay lots of money for lots of unique items. Whereas most pawn shops cant do that.
You Could Lose Your Belongings
While the National Pawnbrokers Association estimates that nearly 80% of all pawn loans are eventually paid back, there are places in the country where the pickup rate for pawned items is far lower. That means many people who give up their belongings for quick cash are not able to get them back. Ask yourself: Is it worth risking sentimental family heirlooms for a small cash loan?
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The Appeal Of Pawning
Weve all been here once or twice: You need money now, but payday is still weeks away. Your credit isnt great, which means you dont qualify for any of those cash back credit cards, and your bills were due yesterday. It might seem like a good time to take that pearl necklace you inherited from your grandmother to the pawn shop and get a loan but is it worth your trouble?
With pawnshop loans, you stand to lose the item you left with the pawnbroker.;
Depending on what you put up for collateral, that could be a big loss for you. If youre a freelancer who trades in their laptop, for example, you may not be able to work if youre unable to pay back your loan. Give up something of sentimental value like a family heirloom, and you could be kicking yourself for defaulting on that loan for the rest of your life.
While a pawn shop loan might seem like a good idea in theory, in practice it can be an expensive and risky proposition. If youre considering taking out a pawn shop loan, do yourself a favor and read up on the risks first. Here are five reasons you may want to keep your belongings out of a pawnbrokers hands.
Some Pawnbrokers Operate Illegally
Most states have strengthened pawn shop loan regulation, but that doesnt mean all pawnbrokers are following those laws. In recent years, there have been many reports of pawn shops charging more than the allowed APR rates, asking people to sign illegal contracts, and deceiving customers about the actual price of their loans.
In fact, in January 2017, the U.S. Consumer Financial Protection Bureau accused three pawn shops in Virginias Fredericksburg area of operating outside the law. An article from Fredricksburg.com said the companies in question understated the annual interest rates on their loan contracts by as much as half, according to three separate lawsuits filed in the U.S. District Court for the Eastern District of Virginia.
A lawsuit was then filed against the pawn shops by Virginia Attorney General Mark Herring, and two out of three settled in March 2017, agreeing to pay more than $62,000 in refunds to more than 1,000 former customers.
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Reasons To Avoid Pawn Shop Loans
If youre looking to buy a diamond necklace at a reasonable price, heading to a pawn shop isnt a bad plan. But selling to a pawn shop is a whole other story.
In addition to selling a vast selection of engagement rings, discarded musical instruments, mismatched tools, and old tech items, pawn shops offer cash loans in exchange for your belongings.;
Heres how pawn shop loans work: You bring in an item as collateral, and the pawnbroker will determine the value of the item, give you a loan based on its cost, and then hang on to your collateral until youve paid off the loan. In a nutshell, it is one way to get a personal loan without a credit check.;
There Are Better Alternatives
When you find yourself in a tight personal finance spot, it might seem like you have an obligation to take out a costly pawn shop loan if your options are limited. But you deserve better than a pawn shop loan, and chances are, you dont have to settle.
Even people with bad or no credit may be able to qualify for an online personal installment loans, which are a more strategic alternative to other types of loans. Personal installment loans may be a better alternative for a number of reasons:
- First, they can help improve your credit, as on-time payments are typically reported to the credit bureaus.;
- Unlike with payday, title or pawn shop loans, installment loans typically have longer terms and set payment that you can actually afford.;
- Youll know before you sign any contract how much you have to pay every month and how long it will take to pay off the loan.
Dont risk losing your precious property. Educate yourself before you jump into a pawn shop loan, and make a choice that will benefit both your family and your bank account.
This blog post was updated April 26, 2018, and again December 14, 2019.
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Get Low Interest Loans From Pawnshops
Many low to moderate income families are turning to pawn shops for short term loans. The locations, most of which are state regulated, will either allow the person to sell the item on an outright basis to raise the money or the customer can apply for a collateral based loan based on their possessions. Both of the options available from pawnbrokers provide households the ability to raise emergency cash in a short amount of time.
As with many non-traditional lenders, the interest rate that is involved from a pawnbroker is fairly high. The rates are generally much higher than on a credit card, but lower than a typical payday lender. So pawn shops listed below do offer struggling families another way to raise money in a short period of time for paying certain bills, but this source of financing will also have pros and cons involved.
Pawn Shops Are A Financial Lifeline For Some
While people from all walks of life use pawn shops, theyre especially popular among those outside the financial mainstream. More than one-quarter of U.S. households are;unbanked or underbanked, according to the Federal Deposit Insurance Corp. And these families rely on services, such as payday loans, auto title loans, rent-to-own stores, and check cashing, for all or some of their day-to-day financial transactions. Forty percent of these households have also used pawn shops, according to the National Pawnbrokers Association.
The pawn-shop loans are an attractive proposition for those on the financial fringes for a couple of reasons. Not only can a pawn loan be obtained without a credit check, but the debt is relatively low-risk. If you cant repay your pawnbroker, you lose the item, but you wont receive a black mark on your credit report. Compare that to high-interest payday loans, which can easily trap consumers in a spiraling cycle of debt.
People would not need pawn shops to make ends meet in an ideal world. But its a much better alternative for a low-income or unbanked person with a financial emergency than a payday lender, Birnholtz said. It sucks to lose your item, but its a lot better than being trapped for years and thousands of dollars of onerous, hard to understand fees.
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Advantages Of Pawn Shop Businesses
Pawn shops are a good choice for those who need a small amount of cash quickly but are wary of the debt associated with high-interest short-term loans. In addition, pawn shops typically do not perform credit checks because they already have collateral and failure to repay results only in the loss of the item. As an option for small-business owners, a pawn shop requires few skills apart from appraising the value of merchandise.
Be Prepared For Red Tape
The pawnbroker is legally obligated to confirm that you are the legal owner of the property.
They will ask you enough questions about your property to become comfortable with the fact that you own it, says Krupnik. Do not be offended; the pawnbroker is just trying to make sure that both you and the property are legitimate.
Also, if you do business with the pawnbroker, expect to have to show a government-issued ID. It is required by law.
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Redemption Of Pawned Property
If you are one of the fortunate few who pays a pawn loan back in full within the time specified by your loan terms, you do have legal rights that protect you. You have the right of redemption. This right is governed by state law and basically means that if the pawn loan or title loan is paid in full within a certain period of time, the property will be released back to you. This right of redemption is usually outlined in the pawn contract you sign when you enter into a loan agreement. Unfortunately, most pawn transactions end with the person losing their pawned property because the interest rates are very high and paying the loan back is nearly impossible within the time frame allowed.
How Pawn Shops Work
At a pawn shop, you leave your propertythe most commonly pawned items are jewelry, electronic and photography equipment, musical instruments, and firearms. In return, the pawnbroker typically lends you approximately 25% to 60% of the item’s resale value.
The average amount of a pawn shop loan is about $75$100. You’re given a short time, typically a few months, to repay the loan and are charged interest, often at a very high rate.
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Interest Rates On Our Pawn Loans
When searching for the best pawn loan for you, its important to compare a few crucial factors.
- The interest rate
- The service fee
- How much time you have to pay off the loan
Most pawn shops charge an average fixed rate of 13%. This means if you borrow $100, you will pay an additional $13 in interest. Pawn shops also typically charge a small service fee of $5. Lastly, most shops will allow you a period of just three months to pay off the loan. There is often little flexibility here.
At Johns Pawn Shop, we only charge an 8% interest rate.
Additionally, we can give you up to four months to pay off the loan instead of just three.
The Interest Rate Explained
The dollars and cents of pawnshop loans get a little complicated because: a) rules regarding the fees vary widely from state to state, and b) its not a cut-and-dried interest rate.
The term interest rate can be very confusing, so its better to think of the total allowable finance charge, says Steve Krupnik of South Bend, Indiana, creator of the Pawn Shop Advisor coaching program and author of the book Pawnonomics.
Pawnshop loans are nearly all state-regulated, and finance charges can vary from 5% per month to 25% per month. In Indiana, the interest rate is capped at 36% APR or 3% per month, but pawnshops can charge an additional 20%-per-month service charge, making the total allowable finance charge 23% per month, says Krupnik.
However, Krupnik says, The pawn industry is evolving rapidly and these maximum finance charges are voluntarily being reduced by many operators, especially on larger pawn loans that are now becoming the new norm.’
A personal loan is a good alternative for those who need money for travel or a home renovation. Find the best rates at Bankrate.com.
These are what we call safety net loans and are usually for life emergencies, Murphy says. The typical fee, he adds, is often lower than the cost of a bounced check or a disconnected utility.
The bottom line: Make sure the pawnbroker clearly explains all the fees involved in your loan before you finalize the transaction. These terms also should be listed on your pawn ticket.
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