Get the Cash You Need With Pawnbrokers Loans - By: Gareth Hoyle1

Pawnbrokers are basically businesses that will loan you money. This can be a very fast and easy way to get the cash you need without having to spend time applying for a conventional loan. With a pawnbroker loan you will need to leave a valuable item as security against the money you will borrow. You will then be able to ‘buy’ the item back again by paying off the full amount of the loan plus any interest and fees.

How Does It Work?

Anyone can use a pawnbroker service as long as they have items of value that they can leave in exchange for cash. Some pawnbrokers will specialize in certain items such as jewelry and collectibles and others will accept a wide range of goods including cameras, watches, computers, cars and even endowment policies. You need to take your item into the pawnbroker and they will then value it for you. There are no credit checks or references required and the broker will offer you a loan based on the item (or items) as security. Once you have agreed a price you will sign a credit agreement and receive a pawn receipt. You must keep receipt as you will need it to reclaim the item. If you lose your receipt then you may have to sign a statement to this effect which may need to be witnessed by a solicitor.

The pawnbroker will then keep your item safe until you have finished paying off your loan. You will have a certain amount of time to pay off the loan (known as the term) which would typically be around 6 months on any loan under £1,000. In some cases you will be able to get an extension on the loan but this will be up to the pawnbroker.

How much will you get?

This will depend on the item you have to pawn. The pawnbroker will only offer you a percentage of the items total worth. This will typically be around two thirds of the estimated value so if you were to take in an item valued at £1000 you would get around £1500 to £1750 as your loan amount. The pawnbroker will charge an arrangement fee as well as interest so you do need to check all the costs involved before you sign the credit agreement. The interest on the loan and the charges will mean you will have to pay back more in the long run than you originally borrowed.

What happens if you can't repay the loan?

Because you have left your valuables as security against the loan if you cannot repay the money you have borrowed (plus the interest and fees) by the time the term has ended then the pawnbroker is entitled to sell the item. This means that you will not be able to get your item back.

About the Author

Pawnbrokers are regulated businesses that can offer a fast way to get access to the cash you need. There are no credit checks to go through so even if you have a bad credit rating you can still get a loan by using your valuables as security.

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