Pawn shop loans are a type of short-term secured loan where ​borrowers can use their personal possessions as collateral. Here's how ​pawn shops like Cash Express’ loans work and when they may make sense:

How it works: You’re stuck and need money quickly. If you want to secure a pawnshop loan, bring in an item of value, such as pottery, coins, watches, electronics, or jewelry, to the pawnshop. If you’re unsure what things the pawn shop may want, look at their online catalogs for inspiration. Or, call the store and ask about “hot ticket” items currently. 

Once you’ve picked out your collateral and arrived at the store, the ​pawnbroker (or a skilled professional employee) inspects the item, assessing its worth and offering a loan. The amount is based on a percentage of its value, typically around 25% to 60%. 

Expert tip: Avoid any items with strong emotional connections. If you lose that piece, you’ll regret it. 

You now have a choice to make. Do you accept the loan terms? If so, there is an immediate receipt of the cash and a pawn ticket, which is evidence of the loan. The loan period is typically 30 days, during which the borrower can repay the loan with interest and redeem their item. 

What happens if you cannot pay? The pawnbroker may sell the item. However, many store owners will reach out before then and try to work out new terms with you. You can also inquire, explaining the circumstances.

When They Make Sense: 

Pawn shop loans can be beneficial in certain situations:

a. No Credit Check: You don’t have to worry about a credit check or verification of income. There will be no impact on your credit score, which is perfect for people with poor credit or no credit history.

b. Quick Cash: Pawn shop loans provide immediate access to funds. If you need money urgently to cover unexpected expenses or short-term financial hardships, a pawn loan can offer a fast solution.

c. No Risk of Debt: Unlike traditional loans, pawn shop loans are collateral-based. If you cannot repay the loan, there is no direct impact on your credit score, and you won't accumulate additional debt since the collateral is used to secure the loan.

d. Negotiable Terms: Pawn shop loans often have more flexible terms than traditional loans. The loan amount, repayment period, and interest rates can often be negotiated with the pawnbroker.

The Downside

Considerations: While pawn shop loans can be helpful in certain situations, there are a few factors to consider:

a. Interest Rates and Fees: Pawn shop loans typically have higher interest rates and fees than traditional loans. Having said that, the interest is over a shorter time than most conventional loans.
b. Value of the Collateral: If you underestimate your collateral’s worth, you may receive a lower loan amount than expected. Do your research before heading to the store.
d. Limited Loan Amounts: The loan amount is typically a percentage of the item's appraised value, which may not provide sufficient funds for larger financial needs. You may need more than one item. 

Getting a Loan

Pawn shop loans, like those we offer at Cash Express, can be a viable option for those needing quick cash, especially if they have poor credit or require a short-term solution. You can call us at 215-922-1580 if you have any questions about how to proceed. You can also use our contact form to open discussions on particular items.