The prevailing dire economic situation has forces many households to find venues of making extra money where ever they can. One of these venues which has recently been seeing a surge in popularity is to sell a piece of jewelry or a valuable item for cash. However, there are some valuable items in the house that have enormous sentimental value and obviously people don’t want to part with them on a permanent basis. If you are faced with such a situation the securing a pawn loan may be the best option for you.
Before going into an agreement with a pawn shop, you must do the necessary research in order to understand how the phenomenon works.
The terms and conditions in a pawn shop are different from that of a jeweler. The first and the most important benefit of a pawn shop is that there is a professional appraiser at these establishments who appraises your valuable. The appraiser also lets you know the price of the item. You will also get to know the rate of interest on the loan as well as the terms and condition that must be fulfilled.
If you don’t like the terms and conditions, you can simply refuse the loan, however if you agree, you will get the cash as per the agreement. Your valuable belonging becomes the collateral against the loan. Most of the pawn shops would lend you money for a period of two to three months.
When you repay the loan and the accrued interest on the loan, you can have your valuable belonging as it is. However, if you are unable to repay the loan, that item will become the property of the pawn shop.
The pawn shop’s another benefit is that if a person is unable to repay the loaned amount, that person may apply for an extension in the repayment time rather than surrendering the valuable to the shop. The same loan may also be renewed after paying a portion of the accrued interest.
Of course, as stated earlier, people do have sentimental attachments with a particular piece of jewelry or another valuable item. The pawn loan is a very convenient alternative to an outright sale of the cherished item. Moreover, if you apply for a bank loan, you may not qualify for it. The pawn shop would grant the loan based on the market price of the item being pawned rather than your credit rating. For the past few years, the banks and other financial institutions have tightened their criteria for granting loans. A pawn shop become very convenient in this condition when you are in urgent need of money for a short period.
Most of the pawn shop are licensed. They are also being regulated by competent authorities. Pan shops are also insured. Your valuable item is safe with them.
With the help of the appraiser at the pawn shop, you also get to know the actual current price of your item rather than having to guess it market price.