What is a pawn loan
Pawning, "the other oldest profession"™. The concept of pawning dates back thousands of years. It existed in the Ancient Greek and Roman Empires as well as early Chinese society.
Pawning is not selling. A pawn loan is simply a loan that uses the customer's collateral as a guarantee of payback. In other words, you receive a loan (cash) by allowing the pawnbroker to hold something you own that has value (collateral). Collateral can be almost anything that has value - jewelry, electronics, designer handbags, collectibles, musical instruments and more.
While the details of a pawn loan may vary, the important thing to know is that if you pay back the loan and agreed upon interest within a specified time the collateral is returned to you. If you can't or choose not to pay back the loan you keep the money but the pawnbroker now owns the collateral and may sell it as they please.
That's it! And since both you and the pawnbroker always hold something of value (the money or the collateral) pawn loans are in no way linked to your credit score.
Pawning survives (and thrives!) today because of this simple and logical collateral for loan business model. It's an easy way to turn valuables you don't want to sell into a quick, secure and affordable loan.
- DON'T SELL YOUR ITEMS
Pawning is not the same as selling.
- BORROW MONEY
A pawn loan lets you borrow money against your valuables (collateral) without having to actually sell them.
- GET YOUR ITEMS BACK
Once the loan is paid off your valuables are returned.
- NO CREDIT CHECK
Your credit score is never be affected by a pawn loan.