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Top 5 Myths About Pawn Shops

Top five myths about pawn shops plus one

When someone is looking for inexpensive jewelry or electronics, or they need to sell some of their own items to get some quick money, they might want to visit their neighborhood pawn shop. However, many people are still apprehensive about using pawn shops. There are many myths about pawn shops when it comes to selling, buying or loaning from them. Once you realize these myths are just myths, your pawnbroker can be a great resource. Let us try to debunk some of the common myths about pawn shops:

Myth 1: Pawn shops are unregulated

A lot of people believe that pawn shops operate as they want, that they’re not regulated. The fact is that pawn shops are heavily regulated. Most pawn brokers are required to be licensed at a state or local level. In Connecticut pawn shops are licensed at the local level with each city or town applying their own rules and regulations.

Myth 2: Pawn shops knowingly buy and sell stolen goods

As the first point elaborates, pawn shops must adhere to all local, state and federal regulations. So, the last thing they want is to get into trouble with law for selling stolen goods. The fact is that pawn shops work closely with police to catch thieves. For all transactions, the seller has to provide their personal details and a valid photo id. The products received are catalogued with proper serial numbers for inventory purposes. The police can easily compare the serial numbers against any items reported stolen. In case it is found that the item is stolen, it is returned to the rightful owner.

Myth 3: Pawn shops are normally the last resort for a loan or purchase

A lot of people think that the only people using pawn shops are the ones who have no other options. The reality is that pawn shops see all kinds of customers-bargain hunters, DIYers, parents, small business owners, environmentalists and more. With a lot of Americans living pay check to pay check, pawn shops offer a great way to get a quick loan without too many hassles. For shoppers, it is a good place to buy a pre-owned item at a much-discounted price.

Myth 4: Pawn shop owners don’t want you to come back for your items

This is another misconception that keeps people from using pawn shops. The reality is that it is in the pawn shop’s best interest that the loan is successfully paid back along with the interest. Once you take back your item after paying back the loan, there is always a chance that you may be back to pawn the item again. If someone has not returned the loan, the pawn shop would often call them at least twice before the item is sold off.

Myth 5: You find only used, poor quality items at pawn shops

Anyone who believes this should watch the Pawn Stars on History channel. You will not just find used junk in pawn shops. You can find high end electronics, diamond jewelry, gold,  high-end artifacts and much more at a pawn shop. You will be amazed the kind of things you can buy and the amount of money you can save.

Myth 6: Pawn shops charge huge interest rates

Among the biggest myths about pawn shops is that interest rates are exorbitant. Interest rates on loans are always commensurate with the amount of loan and the level of risk involved. When someone gets a loan from a pawnshop, it is usually for a smaller amount and for a shorter time period. Moreover, your item is your pawn broker’s only collateral. So, the interest rates are high but not unreasonable.

Pawn shops can be of great help for anyone who needs fast cash, and their credit history isn’t particularly impressive. You can also check out the shelves and buy some amazing items at a good discount.