A short-term problem with income or an unexpected household or medical emergency is a situation that most Americans have faced in the past or will face at some point in the future. When this type of situation occurs, having fast access to some extra cash is often the best way to resolve it.
For generations, reputable pawn shops have provided their customers with loans to help with life's little emergencies. If you are currently considering a visit to a local pawn shop for the purpose of obtaining a small loan to solve a pressing financial need, this information will help you better understand the process.
Collateral is required
The first thing to know about pawn shop loan services is that any loan made will require collateral. The proprietor of the pawn shop, sometimes called a pawnbroker, will examine the item or items you are using for collateral to determine their approximate value. If they choose, they can then offer you a loan based on a percentage of the item's value.
Loan offers are not guaranteed
If you are interested in obtaining a loan from a pawn shop, you should also know that there is no guarantee that you will be offered a loan against your item. The pawn shop is a business that will need to be able to easily resell any pawned items that are forfeited, so loans will most often be granted based on how valuable your item is and how easily the pawn shop feels it can be resold.
The loan will be for a short term
Most loans obtained through pawn shops are for very short-term loans, typically with just a term of a few weeks or months. Borrowers who return to the pawn shop and repay the full loan amount, plus any fees agreed to in the loan agreement, prior to the deadline of their loan will have their collateral returned to them at that time. Some pawn shops will also allow the loan term to be extended, with an additional fee.
You must keep pawn tickets safe
When you agree to a loan from a pawn shop, you will be given a pawn ticket that serves as a receipt for your item. The pawn ticket also outlines the terms of your loan agreement with the pawn broker. It is important that borrowers keep their pawn ticket safe because it may not be possible to retrieve their collateral without it.
Some pawn shops may also be interested in purchasing the item you are planning to use for collateral, instead of making a loan on it. To learn more about the pawn shop loan services or a possible sale, take time to discuss your situation with a reputable pawn shop in your area.
Share27 October 2020
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