There’s an important economic role that the pawn shop industry plays in many communities. Although it does not necessarily have an effect on the country’s economic status, the industry helps individual consumers cope with the financial demands of daily living. Pawn shops have, in fact, proven that they are significant in the lives of many.
Not everyone has dealt with pawn shops, but many are aware that they exist and that they provide financial solutions to quick cash needs. It should be stressed, however, that these pawn shops are not all the same. To familiarize you with these business establishments so that you can decide whether or not they will be beneficial to you today or in the future, here is a quick rundown on their features, differences, and services:
Features of a Pawn Shop
A Pawn Shop is a business establishment that lends its customers with cash in exchange for items that are left in the store for safekeeping until such time that the loaned cash is paid back. The need for such services remains even with the development of high technology and internet marketing simply because they continue to cater to people’s needs. Pawn shops have actually tapped into the recent developments and have gone online in the face of touch commercial competition.
The appeal of pawn shops is that they do things quick and easy. They do not require a lot of paperwork and do not take a long time to approve the loans that they grant. Recently, pawn shops have also expanded their services not only to pawning but also to buying and selling various items of value. They deal with items such as jewelry, watches, smartphones, and laptops among others. The down side is that these business establishments do not usually grant cash loans that are equal or more than the value of the item being pawned.
Another major advantage of pawn shops over other lending institutions is that they are open all days of the week and are easily accessible. It’s almost instant, you walk in with your items, it gets appraised, you sign the papers, and you walk out with the cash. The entire transaction can be done in a matter of minutes and you can have the cash that you need for your emergency expense.
Differences in Pawn Shops
There are differences in the way pawn shops operate. For instance, they have different ways of appraising the items taken in for pawning. There are some pawn shops that only accept items that are in good condition. Some pawn shops, however, like MajorPawn accept even items like watches and jewelry that are broken. There are also those that require contracts, while others practice so-called “no strings attached” policies. Like other lending institutions, however, all pawn shops charge interest rates on the cash they lend to their customers.
Services Offered by a Pawn Shop
The two major transactions that are done in a pawn shop are: granting loans on pawned items and selling pawned items on unpaid loans. In both these services, the money is easily and quickly given to the customer.
• Granting loans on pawned items
If you urgently need a quick short-term loan, bringing one of your valuable items is one solution that you can consider. You can get the cash right away and then come back to get your item back anytime by repaying your loan. Your item remains in exactly the same condition as when you brought it in.
• Selling of pawned items on unpaid loans
A loan obviously has to be paid. When the customer is not able to repay his loan, the pawned items that served as the loan’s collateral becomes the property of the shop. It can be sold in an auction or in any other means and venue that the shop owner chooses.
There are instances when customers come in to directly sell items of value to the shop. In such cases, there is no loan granted. The equivalent of the appraised value of the item is given to the customer and the customer does not have the obligation to pay it back nor does he have the right to claim the item he sold anymore.
Dealing with Pawn Shops Safely
Transactions in pawn shops are safe and secure. The items that are pawned are kept in sealed containers and are locked away in vaults to ensure that they are not damaged or do not get lost. This is an assurance to their customers that their items will be there for them when they come back to claim them.