Life is full of uncertainties and you never know when one problem befalls you. Well, when everything seems to be going well, suddenly you may be surrounded by problems such as down with a major disease, your car requiring major repairs, approaching wedding ceremony and so on. For all of these situations, you’ll not only need financial assistance but also need it fast. Thus, a pawn loan is the best accessible option to receive the funds and quickly too. Moreover, pawnbrokers are also gold buyers and you have an option to pawn or sell your gold jewellery to them.
Sure, you can get the loan from banks and other financial institutions as well but the procedure is quite lengthy and there is no assurance that you’ll receive the funds. These traditional financial institutions will look at your past credit history, income proof and other details and if they’re satisfied with all the scrutiny and documentation, they will proceed further to ascertain the maximum limit (loan amount) that they can approve. You’ll have to go through all of these processes, which may take at least over a week’s time and wait patiently to receive the loan amount without any guarantee whatsoever.
That’s why if you have a valuable item or two, getting the pawn loan is the best option, as you’re guaranteed to receive the funds on the same day itself. Besides, you don’t have to show your income proof or worry about your credit record. All you need is have a valuable item that can be pawned, valid photo identification and must have attained at least 18+ years of age.
Keep in mind, the loan amount will be based on a certain percentage of the value of your pawned item (and not on the item’s current market value). When availing the pawn loan, you have the option to recover your item; however, you will have to pay off the loan amount and interest at the time of loan’s expiry. If you’re wondering what will happen to your pawned item when you don’t revert to claim your item back as per the agreed timelines or forget then here is what you need to know:
- YOU HAVE A CHOICE
- PAYING OFF YOUR LOAN
- EXTENDING THE LOAN DURATION
- REFRAIN TO PAY THE LOAN ON THE DUE DATE
- SURRENDERING YOUR PAWNED ITEM
Unlike other loans, you have different alternatives when a pawn loan is due. You can make the choice of paying or not paying the loan.
You can pay back your loan in full with interest on or before the due date and get back the possession of your valuable item.
On the loan’s expiry or due date, if you’re not in a position to repay the loan but you’re keen on reclaiming your valuable pawned item then you can extend the term of your loan by one month just by paying one month’s interest to the pawnbroker.
If you don’t turn up and pay the loan on the due date or extend the loan duration or forget to pay or default it willingly; in all these cases, the pawnshop will place your pawned item for sale, to recover the loan amount, interest and also book a small profit to survive in this business.
If you don’t have enough money to claim your pawned item back or you don’t want to recover it, you can willingly surrender your pawned item by choosing not to pay the loan back.
Related: What to Expect When Pawning Your Gold Jewellery
THE BOTTOM LINE
Unlike other loans, non-payment (default) of a pawn loan won’t affect your credit standing whatsoever. Apart from availing a pawn loan from pawnbrokers, you can also sell second hand goods of value unto them and obtain instant cash. What a wonderful way to clear the clutter from your home and earn some quick bucks too!
