Getting a traditional loan can be challenging, full of paperwork and identification that you need to provide to get approved. A simpler yet effective alternative could be a pawn shop loan. Though this is usually much quicker than securing a traditional loan, there’s still some information you’ll need to know before heading to the pawn shop.
What Is a Pawn Shop Loan?
A pawn shop loan is a type of collateral loan in which you exchange an item for its appraised value. You then receive cash, and the pawn shop keeps your item for a designated amount of time — usually around 30 days to two months — as collateral. The average pawn shop loan is around $150 and is repaid in about 30 days.
If you don’t pay back your loan, then the pawn shop takes ownership of your item. Over time, your loan will accrue interest, which you’ll have to pay back if you want your item back.
How Do Pawn Shop Loans Work?
Pawn shop loans work rather simply. First, head to the pawn shop with your item. At the shop, the pawn broker will examine your item and appraise it, effectively determining its worth. You’ll likely fill out an application with the required information, and then you’ll receive your loan based on the estimated value of your item. You’ll also get a pawn ticket that you’ll need to get your item back.
Pawn shop loans are attractive options for those looking to get quick cash without having to provide a credit score.
What Do You Need to Get a Pawn Shop Loan?
It’s much easier to get a pawn shop loan than a conventional loan, mainly because you’ll be able to forgo a credit check and a prolonged exam of your financial situation. Still, to be approved for a pawn shop loan, you’ll need a few different things.
1. A Valuable
One of the first things you’ll need to attain for your pawn shop loan is the actual object you’ll trade in. This item should be a valuable that you want to exchange for a general price. Your item could be just about anything — something as simple as a TV to an expensive piece of jewelry. Other items you could loan include:
- Cars
- Coins
- Watches
- Precious metals
- Musical instruments
Be sure you set your expectations before you go in — you shouldn’t expect a big loan for something relatively inexpensive. The key is to ensure your item is in good condition and that you have a sense of how much its value is. This will give you a good starting point to work from.
2. Application
You’ll also need to fill out an application at the pawn shop store. The application will include simple information like your name and contact information, such as a phone number or email.
3. Proof of Identity
Part of the application will include proving your identity. You need to be over 18 to get a loan from a pawn shop, so bring your driver’s license or other government identification to qualify.
4. Financial Information
Sometimes, you might have to provide some financial information to a pawn shop, such as proof of employment or income, although policies differ, and some shops may not require it. Still, you should be prepared with this information when you go to get a loan. It’s better to be prepared than to show up unprepared to meet the pawn shop loan requirements.
Benefits of Pawn Shop Loans
Pawn shop loans are popular for several reasons, from convenience and simplicity to low financial risk. Ultimately, they are among the best alternatives to receiving a traditional bank loan. Here’s why it’s beneficial to consider a pawn shop loan.
1. Convenience
A pawn shop loan is one of the easiest ways to receive a loan. All you need is an item to trade in, and you’ll have cash you can use in any transaction. Instead of having to go through the slow and thorough financial questioning and credit checks, all you’ll need to do is fill out an application and proof of identity, and you’ll be on your way.
2. Low Risk
If you’re looking for a low-risk loan that won’t impact your on-the-record financial situation, then a pawn shop loan is the way to go. A pawn shop loan won’t affect your credit score. Even if you don’t pay back your loan, you won’t take a credit hit or be harassed by credit collectors — the pawn broker simply keeps your item. A pawn shop loan doesn’t require much information because it’s backed by the item you place for collateral.
3. Speed
Traditional loans can take several weeks to process. With a pawn shop loan, you get your money instantly and can spend it the same day. This is a great advantage for those looking to get their money quickly.
4. Flexibility
You can get multiple loans from a pawn shop at the same time or throughout the week. Since each loan is based on the collateral of the item you bring, you can get as many loans as you have valuables without penalty. This offers you a lot of freedom that conventional loans don’t allow.
5. Safety
Pawn shops also offer a safe way to exchange your items for cash. Instead of trading your belongings to independent sellers, you can find a trusted pawn shop dealer who can give you cash while also keeping your item in a safe spot.
Contact The Vault
When you’re looking for a quick loan, there’s no better place than a trusted pawn shop that can instantly get you money and keep your item protected. At The Vault Jewelry and Loan, we offer cash loans for as low as $10 or big loans of $25,000 or more.
We’ll keep your items stored safely in coded vaults so you can be confident in their protection. Your privacy is one of our top priorities — The Vault Jewelry and Loans works on a closed system without the need for credit checks or credit reporting. At the end of 30 days, you can retrieve your item without any hassle.
We’re the convenient, reliable alternative to slow and intrusive conventional loans. Just come by our store, and we’ll appraise your item. You’ll have your cash same-day and won’t have to worry about taking a credit hit. Whether you want to buy or sell, The Vault Jewelry and Loans is here to help. Contact us today!
