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According to the History Channel, the pawn shops of today operate as mini-banks for millions of unbanked Americans and they also serve places for people of all backgrounds to buy and sell items. America’s 12,000 or so pawn shops deal with a huge variety of items including musical instruments, jewelry, and electronics.
“Pawning” means that you give the pawn shop an item in exchange for a cash loan. For example, you might give them your mountain bike as collateral for a $75 loan. If you repay the loan by a certain date, typically 90 to 120 days after you pawn the item, you can retrieve your bike. The loan repayment amount will include interest and fees that are regulated by the state.
If you don’t repay the money on time, the pawn shop takes ownership of the bike and can offer it for resale. Most of the items pawned (about 70%) are reclaimed by their owners and according to the National Pawnbrokers Association’s 2010 Trend Survey, the average pawn loan is $100. Pawn shops also purchase items outright to resell.
Working with a pawn shops can be a good deal for both a seller and buyer, but not always. Following are some tips for selling and buying at a pawn shop.
Tips if you have items to pawn
Tips if you want to buy a pawned item
Finally, whether you’re a seller or a buyer, it is worth your time to consider your other options before going to the pawn shop. While working with a pawn shop may be convenient, you might be able to get a better deal on Craigslist, eBay, or even in a garage sale.
I did not know about pawn shops. This will help me. Thank you!
Probably you should pay a fee every month just to extend your pawn. Something like that may have in the contract.
My college room-mate was always pawning stuff and reclaiming later. For him it worked well, as it probably does for many others. This advice seems good and I've never seen it on other personal financial advice sites.
I love the show pawn stars, but I was never good at getting great deals at a pawn shop. I usually try calling around to see what offer is the best. Thanks for this article. It will definitely help me in the future.
Can a pawn shop take your item. If you had a hold placed on it. I was given a hold date on the 20th of August 2012 for September,5 2012. When I came in on the 5th of September.The pawn shop sad they sold my item on August,22 2012. Can they just steal my item like that. I think it was a inside job. Can someone please give me some feedback on this please.
Thanks for the share. I recently have run into some finical troubles and have been looking into getting a pawn shop loan for quite some time. This article definitely answered a bunch of questions I had regarding the whole process. Thanks again!
I have always thought that most pawn transactions (true pawn, not selling to a pawn shop) could be done away with if only people could manage their cash just a little bit better. I think there are people who just live their lives pawning and claiming the same items over and over again, all because of some minor timing differences between their cash out and their cash in. It would be nice if there were a way to counsel these people so that they could break the cycle, but I guess there's no money in that, is there...
This is a great set of tips. I have a friend who has been considering trying out the whole "pawn scene", and our pawn shop in Calumet City IL probably has the best reputation I've heard of any pawn shop. This should really help, thanks!
The effectiveness of pawning will always depend on the customer. That's all!! :)
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