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Loans are available for people who want to raise money quickly. However, depending on where you apply, the approval periods may vary and sometimes take a long time. If you need a quick and safe cash source, you can seek a money-lending agreement with a pawn shop. Here are a few things to know before securing a pawn loan.

What Is a Pawn Loan? 

A pawn loan is a collateral-based loan. You need to provide the pawn shop with a piece of valuable personal property in exchange for cash. Some common items accepted include jewelry made of gold or diamonds, electronics, and coins. Because you have given the shop collateral, there is no credit consequence should you fail to pay.

When Are They Useful? 

In some cases, it can take weeks before hearing news about a loan application from a bank or another lender. A pawn loan can save you the trouble of lengthy loan processes, especially if you need cash fast. You don’t need to worry about credit history with this kind of transaction. As long as you can provide an adequate item as a security measure, you can get a loan and immediately acquire cash.

How Does the Process Work? 

Bring Valuables in 

Check if the items pawn shopyou plan to bring have substantial value and that you won’t need them anytime soon. Remember that you have to leave these items in the shop. Moreover, you can lose them by failing to pay on time.

Get a Quote

Have the items checked and assessed by the broker. A reputable pawn shop will give a loan that is somewhat commensurate with the value of the item. However, the shop can refuse to provide a loan if they find the collateral unsellable. If approved, you will receive a pawn ticket that should be secured for safekeeping. This ticket contains all the information about the transaction, such as the payment deadline, loan amount, fees, item description, and other essential information.

Understand the Payment Process

A pawn shop may set the deadline a month or four months after the transaction. Before the set date, you have to pay the balance, including the interest and processing fee. After a successful payment, you can get the collateral item back. Conversely, you may incur high-interest rates when you miss a payment. Moreover, if you fail to pay altogether, the pawn shop automatically takes ownership of the item.

 

Follow this guide for a stress-free pawn loan. For secure and reliable transactions, contact Pawn World. The family-owned and –operated pawn shop has been serving clients in Kingsman, AZ, for over 25 years. They also provide low-interest rates and a free quote for loans. Moreover, they offer quality items such as tools and firearms for sale. For more information, call them at (928) 753-3700 or send them a message online.

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