Introduction to Pawn Shops
A pawn broker, or pawn shop allows you to borrow money against an item you own, or sell it outright. Pawnbrokers and pawn shops can access money fast when you need it most. Items pawned to the broker are called pledges, pawns, or simply collateral.
Process of Pawning
When borrowers bring in items of value, the pawn broker assesses worth and offers a loan based on a percentage of that value. The borrower receives cash, and the item is held as collateral. The borrower has a set period to repay the loan plus interest. If not, the pawn broker can sell the item.
Benefits of Using Pawn Brokers
Pawn brokers offer quick loans without requiring credit checks or income verification, helping those who may not qualify for bank loans or need immediate cash. They also buy back pawned items if the borrower’s finances improve.
Conclusion
A pawnbroker is an individual or business that offers secured loans to people, with items of personal property used as collateral. If an item is pawned for a loan, within a time period the pawner may redeem it for the loan amount plus interest.