If you need some quick cash to solve an emergency cash shortfall then start by looking at what you have that you can liquidate. Your basement might be full of things that you’ve never used, that someone else would like to own. They say one man’s trash can be another’s treasure. Go through those boxes that have been collecting dust in your basement or the jewellery that has been lying at the very bottom of your goldjewellery box and head on to the pawnshop. They might be able to offer you’re a great price for the stuff you don’t want. The primary business of pawnshops is to offer loans against valuable items. If you have valuable things that you are not ready to part with, you can take pout a pawn loan instead of selling the items to a pawnbroker. There are more people these days who use pawnshops to find solutions to temporary financial issues. If you are a novice, you might want to take a little time to find out more about how pawnshops work.
Don’t believe everything you’ve heard about pawnshops. They aren’t the seedy, scary places that the media often portrays them to be There are legitimate, respectable pawnbrokers who take pride in providing a financial life-line for people when they need it. They aren’t always looking for an angle to get you to pay more for your loan by hiding the real cost of it in obscure fees.
Traditionally, bank loans have a lower interest rate than payday or pawnshop loans but not all pawnbrokers are the same. If you take time to do proper research, you can find a low-interest pawn shop in your area or online.
You can come back to pay the entire balance in full before the deadline. Your loan period could be anything between 30 days and 4 months. If the deadline comes and goes and you don’t show up to pay your loan off, the pawnbroker will keep your items. Unlike personal loans offered by banks and other financial institutions, there are no bad consequences for not paying your loan back except losing your items. If you default, it will not even be reported to credit bureaus. Some pawnbrokers will let you extend the loan period; however, this will come with extra charges.
The interest rates for pawnshops can be confusing because 1) the rules may differ from state to state; 2) The interest rate is not cut-and-dried
You can find a low interest pawnshop that charges as little as 5% month. This rate can go up to 25%. However, in most states, there is an interest rate cap pawnbrokers can charge an additional 20%-per-month service fee or more.
The important thing is: when you take out a pawn loan, you should make sure that the pawnbroker explains all the charges and fees that go into your final payment. Don’t get caught off-guard by the fine print. Make sure you do your research and find pawnshop that not only accepts, what you have to pawn but also offers the most for the least amount of interest and fees.
