These Three Tips Will Score You A Good Loan At A Pawn Shop

Posted on: 10 August 2017

Getting a loan at a pawn shop is easy, as long as the item you are planning to use as collateral is genuine, yours, and in a good condition. Still, you don't just walk into a pawn shop and expect a superb deal; you have to negotiate for it just like you would any other loan. Here are four tips you should use to prepare for a good deal at the local pawn shop:

Know the Value of That You Are Selling

The first rule is to know the value of what you are selling. You can do a quick search online to find out what your item is worth so that you can negotiate from an informed point of view. Just confirm that the items to which you are comparing your item are the exact make and model and are also in the same condition. That way you won't waste time negotiating with the pawn shop owner thinking that your watch is worth $5,000 while, in the real sense, the exact model you have is only worth a third of that value.

Aim for Repeat Business

When shopping for a loan, the general idea is to compare different rates to increase your chances of getting the best rate. This advice may not be good for a pawn shop loan, however, because pawn shop owners crave for repeat business. Once a pawn shop owner does business with you, they will want to hook you so that you can always come to them to pawn your items or take loans from them. Therefore, if you have been dealing with the same pawn shop for a long time, it's better to continue dealing with them. They are likely to give you good rates and even loan you a higher percentage (in terms of value) so that you can come back for more business.

Understand the Rates

The laws and rules of pawn shop loans are different from those of conventional lenders such as banks. At the same time, the rules vary by state. This means if you have taken a pawn shop loan in another state, you should not rely on it as a guide when taking a pawn shop loan in another state. For example, some states allow service charges in addition to the actual interest rate, and the latter effectively increases the interest rate you will be expected to pay. It is advisable to understand your state's laws on these rates before setting foot in the pawn shop to avoid unnecessary controversy. Contact a company like Wimpey's Pawn Shop for more information and assistance.