A pawn shop is a regular business that offers secured loans on items people bring in. These assets, referred to as collateral, can range from gold and silver jewelry to collector’s items or paintings. Unlike selling the item, a pawn loan does not require a credit check and you still remain the owner of the asset. More info https://valuepawnandjewelry.com
Pawn shops have a long history of helping people get out of tough financial situations. Typically, you will receive four months plus a 30-day grace period to pay back the debt and reclaim your item. You may also have the option to extend your term (where allowed) and pay additional fees for storage, insurance or renewal of the pawn loan.
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However, pawn shops do have their issues, as shown by legal actions against them for not being transparent about interest rates and other terms. If you are looking for alternatives, consider a payday alternative loan or an unsecured personal loan from a credit union.
When you bring an item to a pawn shop, the pawnbroker will appraise it and offer a cash loan based on its value. You walk away with the cash (which averages around $150) and a pawn ticket, which you must keep somewhere safe — as you will need it to reclaim your item. The pawnshop is backed by the item you brought in as collateral, so they don’t report the debt to your credit bureaus. In contrast, defaulting on a payday loan could cause your credit score to plummet.