Pawn shops...

swindled

Wasn't sure where to put this, and a bit of a hypothetical for myself, but just wondering as distant family have used pawn shops in the past for temporary loans with what's called 'buy-back' where you can pay off the loan and get your goods back afterwards.

Typically the interest rate is a usurious 80-100% APR, but there must be a fair few people who default and lose their goods.

Obviously if you have bought jewellery insured and independently valued at £500, they aren't going to give you the full £500 worth in cash as you wouldn't pay them back £600 (£500 plus approximate £100 in interest after six months) if your item is only worth £500 in the first place. Also, I'm sure they would very much prefer to get repaid in cash rather than take the trouble to have your item sold.

So approximately what fractional value of the item would a pawn shop typically lend you, that ensures they make a profit if you default and they have to sell your item, or you have repaid the loan with interest?

[Deleted User]

It's usually about 25% of its resell value. Might get a bit more if it's a particularly easy thing to sell, like a Rolex.

Richey_

Any monies left though after they have sold your property and paid off what you owe must be returned to you

DigForVictory

Swindled, google cash converters etc and their ilk (& ulp what a lot there are) & ask what rate are they charging?

You no longer need to go in to ask, thought when you do take Aunt Nelly's wristwatch you'll need ID etc as well as a physical presence & ideally be a bloke as women get quoted lower values.

Honestly, talk to a credit union instead?

bris

Insured values are far to high, the true worth is usually half that. They will offer a quarter of the true value.


Desperate people use pawn shops, they know this so offer a fraction of what it's value is. If they get stuck with it they want to sell it quick, not be stuck with an item they need to sell for it real value to get their money back.