Making the decision to pawn an item for any reason can often bring up a lot of good and bad emotions. However, stress should never be one of them. So, to ensure you’re as prepared as possible for your visit to the pawn shop, our helpful staff at Traders Loan and Jewelry has put together a special list of six of the most important things you need to know before you come in to pawn your possessions.
- You’ll Need ID
You’d be surprised how many people come in expecting to just unload their stuff without doing any of the paperwork. So, to be clear, if you want to pawn anything with us, you’re going to need some kind of official driver’s license or state ID, and be willing to offer up your thumbprint. We’ll also take a photo of the item you’re pawning to identify your collateral. Just remember, any personal information or details about your item you share with us may be sent to the local authorities for record.
- No Credit Check Required
With a collateral loan (pawning your item in exchange for money in which you intend to pay back in return for your item) you do not have to worry about a credit check since your credit score doesn’t matter. Credit only matters when the borrower poses a risk for the lender, but since in this case a lender will just keep the item you pawn as payment, ergo there is no risk!
- Loan Term Limits Are Set By The State
If you didn’t already know, taking out a loan with a pawn shop still means you have to pay back the money in a certain amount of time, much like a bank. The state of California allows borrowers up to four months the repay everything they owe, with an additional 10-day grace period, at which point the borrower must either renegotiate new terms for the remaining balance, or forfeit their collateral.
- Expect Less Than What You Originally Paid For An Item
Used items worth less than new ones. That means, you can’t expect to go into a pawn shop with a piece of jewelry you paid $10,000 for 10 years ago, and expect to walk out having recouped your initial investment – especially when pawning. Between the fact that the item is used, and its general depreciation since purchase, it’s already worth less than what you paid for it, and when pawning an item you typically only receive 20-50% of the total value as a loan anyway. So please, don’t get upset if the amount you’re offered doesn’t reflect the number you had in mind, we do our best to be as fair as possible.
- Interest Rates Are Set By The State
While most people tend to believe pawn shops are predators, the truth is interest rates for pawning in California are all set by the state based on the approximate value of the item. All fees are then laid out and explained to the borrower, making sure they understand their total repayment costs and deadlines, at which point the borrower can sign on the dotted line and walk away cash in hand, or change their mind. It’s all up to them.
- Read Over Everything
The best way to know exactly what you’re getting into is to make sure you read the fine print yourself. Make sure everything is as discussed, the figures all match up, and that you feel good about the deal you’re making. Remember, until you sign that piece of paper, you can change your mind at any time and walk away. So don’t rush, ask questions if you need to, and clarify things you don’t understand – we’re here to help!
To get your pawning adventure started, come visit us at Traders Loan & Jewelry today at 18505 Sherman Way Reseda, CA 91335, call 818.345.8696 , or simply fill out the form on our contact page if you have any questions.