Before you pawn an item, there are five simple questions you need to ask.
Why? Why not just barrel in without the answers?
Taking a deep breath, looking at the situation, and making a thoughtful decision before going through with a pawnshop loan can save you time and hassle. Even if money is tight, you shouldn’t approach loans in a way that you’ll regret. As a plus, choosing the right timing can help you get a better loan!
Make sure to tick off these five questions before pawning your stuff.
Questions to Ask Yourself
Can I Live Without This Item?
While this can also be a literal question (don’t try pawning your medication – that’s illegal), this question should be asked more generally.
If you can’t get your stuff back, will you regret it? Did it have sentimental meaning? Will losing it make you feel like your life is lesser without it?
Even if you’re indecisive on the answer to this question, asking it will let you examine why you like it or would like to keep a certain item. It’s better than deciding it after the pawn!
How Much is This Item Worth?
You may need a certain amount of money from a pawnshop loan. So, you need to pick the right item to get you what you need.
If you need a hundred dollars to tide you over until the next paycheck arrives, pawning a TV you bought three years ago might only fetch you fifty dollars at best.
When Am I Expecting Money?
If your goal is to pay back the loan and retrieve your collateral, ask yourself: when will you get your next paycheck, how much is that paycheck, and how much do you have to pay off the loan once you subtract your expenses (like rent, food, and transportation costs)?
Figure out how quickly you can pay back the loan. From there, you can decide whether or not pawning your item is a safe bet.
Questions to Ask the Pawnshop
How Long Do You Have to Repay the Loan?
Know the terms of your contract with the pawnshop. You need to know how long you have to pay back your loan in order to retrieve your collateral.
The last thing you want is to finally scrape together the money, head to the pawnshop, and realize that you no longer have claim to your item. If it’s already sold or is being sold for more than the money you owed, you’re out of luck.
What is the Interest Rate?
Loans aren’t free, so you’ll need to figure out what the interest rate is from the specific pawnshop you’re going to apply to.
This will also help you calculate how much you’ll eventually owe. Better yet, it can let you shop around and see if there are other pawnshops in the area with lower interest rates. Don’t just go for the first option – find the best option for you. Otherwise, you’ll pay more later.
Pawning isn’t for everyone. What are good reasons for not going through with a pawn store loan?
We have you covered.
Here are five simple questions to think over before you commit to pawning an item for a loan. They may be simple, but they’re enough to ensure you know what you’re doing before stepping foot into the pawn shop.
Can You Part with It?
When you pawn an item for a loan, there is always the possibility you’ll never get it back.
Some people feel the need to get a pawn loan because of unexpected expenses, while they’re between paychecks, or because of a gap in their income. Keep in mind that loans come with interest, so if you pawn something for a $200 loan and you know you’ll have an extra $200 at the end of the month to pay off the loan, understand that you won’t be paying off the whole loan.
If the item has a lot of sentimental worth and you have other items you can pawn, consider pawning those instead – or reconsidering pawning altogether. The last thing you want is to lose a family wedding ring because you thought you could pay back the loan in time.
Is It Worth Enough?
Looking up the worth of an item before you go to pawn it is integral to the process if you want to come out satisfied with your loan. If you need $100, pawning a glass terrarium you bought for $80 isn’t likely to cut it as collateral. When it comes to the loan, you need to find something of equal or greater value to the money you want to borrow.
Are You Expecting Money?
If your goal is to pay off the loan to get your collateral back, make sure you have money coming in before the time your item is forfeit. Whether it’s an upcoming paycheck or collecting money a friend owes you, making sure you know you’ll have the money in the future can go a long way to ensure you don’t lose your item.
Can You Prove Authenticity?
If you’re going to pawn a historic or antique piece, you’ll be at a disadvantage to argue for a good deal unless you can prove what it is. This is extremely important for pieces of art like paintings or sculptures. Proving it was made by the actual artist as well that you bought or inherited it can go a long way in getting you the best loan.
Do You Want to Sell or Get It Back?
You can sell an item at a pawn shop instead of using the item as collateral for a loan, and if you’re not interested in getting the item back, it can be better to outright sell than to opt for the loan as you could possibly get more money for selling.
If you’ve taken into consideration all five of these ideas and still decided to pawn an item at a pawnshop, by all means, you should do it. Sometimes things get tight and a pawn shop loan is the only available recourse to help you and your needs.
There are some items that a pawn store owner may outright deny, whether you’re bringing it to sell or pawn for a loan. Among the weird and interesting things they might turn down, items that are too big commonly get rejected.
What’s too big?
Let’s find out.
What is “Too Big”?
When talking about “too big”, most people think of the actual size of an item. With physical pawn store locations, the idea is to ensure it can fit into their place of business. Often, this may mean fitting through the front door. While some pawn shops might have a back door or garage for larger items, using a door frame as a general reference would be a good idea.
For online pawn shops, shipping costs are the big problem for large or unusual sized items, as postal services upcharge for such items. Thankfully, online services often take this into account and have size and/or weight restrictions for what they will take.
Weight also plays an important role in understanding what “too big” can mean for an individual item. Is the thing you’re trying to pawn only movable with a large team of people or special equipment? Then it might be too big for a pawn shop to consider a safe or practical investment, in case you default on a loan.
For online pawn shops, weight plays almost as much of a role as size does. Trying to send them five heavy-weight bowling balls in the mail might be too much for what it’s worth to ship them around.
What You Can Pawn
Way Too Big
Despite the ambiguity of what a pawn shop might or might not consider too big, there are some items you could reasonably assume they won’t want to take. This includes:
- Industrial fridge.
- A 20-foot-tall iron sculpture.
- A stalled or otherwise broken car.
- Portable sheds.
Just Big Enough
Some large items might fall into an iffy area, but it’s alright to assume these items will be taken by most pawn shops.
- China cabinets.
- Industrial shelving (especially if you can take it apart).
- Bed frames.
- A tool cabinet.
Don’t forget to ask the pawn shop themselves if what you want to pawn is too big for them. All pawn shops are different and may have different standards for what they will consider too big. Pawn stores that deal in loans on cars may be willing to use a car as collateral, and an art specialty store might be interested in the aforementioned 20-foot-tall iron statue, so long as you can transport it to them at your own expense.
A good rule of thumb is: if you can fit the item in question into the back of a truck reasonably and safely, you’ll be fine. When in doubt, give the pawn shop owner or manager a call just to save yourself a trip.
Before you enter a pawn shop, it’s wise to understand how you can receive the best deal, whether you’re pawning an item for a loan or looking to buy or sell.
Pawn shops are one of the last few places in modern commerce where you can haggle and are expected to protect your own interests. As such, going in without all the information leaves you at a disadvantage.
Before walking in, here’s what you should know:
Research Market Value
- What is the going rate for an item you’re trying to pawn, sell or buy? If you don’t remember what you originally purchased the item for, look up similar items and how much they’re selling for now. Don’t go into a pawn shop unaware of the price you should expect, or you’ll be at a disadvantage.
- Once you have a good idea of pricing, start the haggling process with a slightly higher figure than the general market value. This is done with the expectation of coming down in price and reaching a compromise later.
- Be suspicious if they try to convince you it’s worth a fraction of the price. Even a used or secondhand item shouldn’t lose all its value, so long as it’s in good condition.
Understand Flaws and Fixes
Are you trying to buy something that might have a few flaws in it? Are you trying to sell something that needs to be fixed?
Knowing its flaws and possible fixes helps you understand the item’s value. An unfixable item isn’t worth buying or selling to a pawn shop owner. However, someone may convince you to buy an unfixable item, saying that the flaw is totally fixable. Likewise, they could haggle you down to a lower price by convincing you a minor flaw diminishes the total worth.
Learn How They Operate
What is the interest rate at the pawn shop? How long do you have to pay back the loan before your collateral is forfeit?
Read their rules carefully and completely before engaging in any business. When negotiating, this will help you avoid any confusion and seem knowledgeable to the pawn shop owner.
As a plus, when you don’t have to reiterate the basics, it saves time and makes business go a little smoother.
Know Your Options
Before walking in, you should decide: Can you get a loan, sell your item, or buy a particular item somewhere else?
Whether it’s at an official store or a different pawn shop, it’s wise to shop around. Places that have multiple pawn shops or other venues for buying and selling used goods give you options. You also have the upper hand; if you don’t like their offer, you can take your business somewhere else.
The difference isn’t always significant or drastic. You can’t get away with unreasonable demands just because they have competition. However, you can feel safe in the knowledge that you don’t have to accept the deal; you can go elsewhere
Are online pawn shops better than the brick and mortar kinds?
Yes and no.
Each of these pawn shops have their own pros and cons – which could make them ideal or annoying for you. Which should you choose?
Let’s take a look.
Physical Pawn Shops
Physical pawn shops and locations are easy to access. Taking your stuff to them or buying from them is relatively easy and cheap, if you have the right kind of transportation.
For example, buying an old piano from a physical pawn shop is far easier and cheaper if you own (or have a friend who owns) a truck. Paying for the shipping costs would be unreasonable. Even renting a truck to drive for a couple of miles is often cheaper than buying a large, oddly shaped item from an online seller.
Bigger Collection (Literally)
For this reason, many online pawn shops might not accept large items to buy or sell. A physical pawn shop will have a more varied collection, with furniture, heavy tools, and even vehicles to choose from.
A physical pawn shop may also be a faster experience. If you walk in, find something you like, and buy it, you can walk out with it immediately. No waiting for shipping time or bank processing. The same applies to selling and loans.
The cost of renting or owning a physical business is often passed down in the prices, how much they’re willing to pay sellers, and the loans they’re willing to give. In addition, a physical shop needs at least one employee at all times in order to operate, so those expenses add up fast.
Online Pawn Shops
Lower Base Prices
There’s no need to hire full-time employees, there’s no rent to pay, and there are generally fewer licenses to have. All this adds up, so online pawn shops can save on operating costs – and therefore lower their prices.
The novelty of the internet is accessibility. You can visit an online pawn shop from anywhere, at any time – even from the comfort of your home! You can browse at your leisure, explore different online pawn shops without moving from one locale to the next, and save items for later viewing.
Can’t Physically Assess Items
For the consumer, an online pawn shop might not always be the best option. If you’re attempting to buy jewelry or clothes, you don’t have the luxury of trying something on.
Can’t Double Check Quality
For other items, like paintings or antique furniture, you’ll have to rely on the assessment of the online pawn shop. They will say what the value of the item is; you can’t get up close to inspect the hinges, check for any chips in the paint, or assess the general construction.
While they may be incentivized by the fear of bad online reviews to be as upfront as possible, this may also encourage them to exaggerate items’ quality. After all, they have to rank well on Google – not just please their customers. If they don’t have a return policy, you may feel cheated out of your money.
Everything comes with a pros and cons list, and jewelry specialty pawn shops are no exception.
These shops can be a great choice when you’re searching for secondhand rings, necklaces, watches, or other luxury items. However, you may also find they don’t always outperform general pawn shops or professional jewelry stores.
Should you pay one a visit? Let’s take a look.
Since they only deal in jewelry, these specialty shops will have a much wider selection of options and styles. You won’t have to go from pawn store to pawn store in the hopes of finding something you like that also fits your budget.
Cheaper than Jewelry Stores
The nature of secondhand lends itself to cheaper prices. Pawn shops, even though they might raise the price enough to make a small profit, don’t mark up their items as much as retailers do – just for the luxury of owning something first.
Doesn’t Support the Jewelry Industry
There are plenty of reasons you may not want to support the jewelry industry, from their unreasonable markup on diamonds to their labor practices. But that leaves a common problem: Where do you find jewelry if you dislike the industry as a whole?
The good thing about secondhand jewelry is that none of the profits go to the original company, so your money won’t be used to support the practice of making new jewelry.
Reusing is always better than recycling. Whenever something doesn’t have to go through the process of being picked apart, melted down, and remade, the world benefits. Why wait for something to be recycled just to have something new, when you can get something cheaper with history and a unique flair?
Lack of Expertise
Though pawn shop owners may take several precautions in identifying jewelry, so as to sell them correctly, the fact remains: they are not a trained jeweler and can make mistakes. You can ask for verification of their claims, but they’re not obligated to provide a certified jeweler just to sate your curiosity or calm your nerves; that can be very expensive.
Slightly Pricier than Normal Pawn Shops
Because they handle objects of higher value, they have a few more expenses to pay than a typical pawn shop. This ranges from specialized equipment to higher security and specialized casing. They may also have higher insurance premiums and deductibles, due to the nature of what they sell. These factors can raise the prices at least a little when compared to general pawn shops.
Sellers Don’t Benefit More
For people looking to pawn their jewelry, a jewelry-only pawn shop doesn’t always mean a better deal. If you sell to a proper jewelry store, you’re likely to find a better profit on your items. Most of the benefits go to the pawn shop and the new buyers, instead of to the people taking out a loan or selling their goods. A jewelry-only pawn shop might be more likely to take more expensive items, but that’s about the extent of the benefits.
Craigslist has become very popular as a digital place to sell and buy used goods for the last 24 years, but there are plenty of reasons to stick with a traditional brick and mortar pawn shop.
Looking to sell? Then here’s why you should choose a pawn shop.
Whether it’s Craigslist or a pawn shop, you’re expected to haggle and negotiate. However, you’re far more likely to come out on top at a pawn shop. To the buyer on Craigslist, you’re trying to get rid of your stuff, and to the pawn shop owner, you’re relinquishing your sellable goods. When you negotiate with a Craigslist buyer, the situation also comes with the cost-sunk fallacy.
Avoiding the Cost-Sunk Fallacy
Typically, negotiations for a Craigslist listing happen while you’re meeting (likely in a public place, such as a store’s parking lot) and, at that point, you’ve already driven out to meet them half-way. They expect you to sell even if it’s a little less than what you want. In this situation, they’re probably the only person that corresponded or the only one that followed through. You’ll feel that getting selling your stuff now is better than having to go through the process all over again.
With a pawn shop, you can take your stuff away and go on to the next pawn shop in hopes for a better deal, and the owner knows this. If they really like what you’re selling, they’ll offer you a better price if you’re not yet satisfied with the number you’ve been given.
While there are many legitimate buyers and sellers on Craigslist, the anonymity of the digital interface lends itself well to scammers and theft. As a seller, you may not run into as many problems as a buyer might, but your potential buyers might insist on giving you a bad check, attempt to run off with your stuff, or meet at a sketchy location.
Don’t Wait for a Buyer
With a pawn shop, you don’t have to wait for the right person that wants what you’re selling. Though the pawn shop does take a bit of the cut, it pays for itself by removing the hassle of waiting, checking your email, and corresponding with someone that might just ghost you at the end of it anyway.
Selling Niche Goods
Depending on what you’re selling, the target audience you’re looking for might not be looking around your area’s Craigslist. On top of that, it’s a difficult platform to sort through and your ad could get buried under plenty of newer ones if you’re not proactive in re-listing every so often.
Buyers at pawn shops can call ahead and ask for particular items, making it a lot easier to find a specific item – especially if they have to expand their radius far out of their own city in order to find it. If you think your stuff might appeal to a smaller audience, don’t wait on Craigslist for those people to randomly find your ad.
Quality jewelry is expensive, and the issue is made even worse by jewelry stores. By now, it’s common knowledge to most people that diamonds aren’t as rare as they’re made out to be. Yet, their price tag hardly seems to reflect that fact.
Other than superstition or social pressure, there’s nothing wrong in buying a secondhand engagement ring. Think about it for a second. If every couple had a brand new engagement ring and no one ever bought secondhand, we’d have an abundance of engagement rings being melted down or scrapped as parts.
If you’re environmentally conscious, you’ll know that it’s better to reuse than to recycle. So, here’s how to buy an engagement ring responsibly.
Engagement rings that are no longer used or wanted (unless they’re sent off to be scrapped or passed on to family) tend to find their way to pawn shops.
Sometimes this isn’t for positive reasons, such as someone defaulting on a loan where they offered their ring as collateral. However, it could also be that family members have sold it after a loved one passed away.
Whatever the reason, a ring found at the pawn shop is almost always cheaper than one bought on consignment from a jeweler.
Find a Specialist
If possible, try to find a pawn shop that specializes in jewelry. Often times, these places make sure to carefully verify the nature of any and all items they have.
If the items are set up as collateral, this ensures the shop won’t be scammed and that the ring is properly cared for.
As a bonus to you, the rings you shop for here are guaranteed as quality, and the shop knows exactly what they’re worth – which is accurately reflected in the price. On one hand, you may not find a hidden treasure going for pennies, but you also won’t buy a cheap ring that’s overpriced.
While it’s typically more expensive to buy from a jeweler than a pawn shop, it can give peace of mind to those who are worried about getting bamboozled.
However, that peace of mind isn’t always cheap. While secondhand stores and jewelry consignment stores are cheaper than buying new jewelry, they often employ more highly trained staff. Additionally, they may have more security, as their whole shop is full of jewelry as opposed to the smaller jewelry collection of a pawn shop. These kinds of additional expenses can reflect in the price tag of the jewelry.
Overall, any of these options are much cheaper than buying from a jewelry store. It’s similar to how buying a used car is always significantly cheaper than buying a new car.
The “Poor Man’s Engagement Ring”
If you’re uncomfortable buying secondhand, there is (what some people refer to as) the “poor man’s engagement ring.” This is comprised of a sterling silver band with a synthetic (or “created”) sapphire. The price tag can hover somewhere around $200, depending on where you buy it.
Though the concept of a diamond engagement ring isn’t as expected in modern days, there’s no shame in hiding the fact that you bought or own a white sapphire instead of a diamond. Most people will never know the difference.
Most people have a good idea of what a pawn shop is, but there are subtle variations to the concept as a whole. This includes online pawn shops, specialty pawn shops, pawn shops that offer auto title loans, and more.
Which is right for you?
Here’s everything you should know about different pawn shop types.
Generalist Pawn Shops
When most people hear the term ‘pawn shop,’ they typically imagine a non-descript building with an assortment of items randomly strewn about on shelves or standing on their own along the floor. They can often feel a little cluttered, depending on the shop and how they run it. However, they can also inspire a bit of adventure in looking to see what hidden treasures wait to be found.
This is known as a generalist pawn shop. As the name implies, they sell a general assortment of items – ranging from expensive and deluxe, to average and unexciting. If you’re looking to browse for interesting items or household objects, a generalist pawn shop has you covered.
These pawn shops buy and sell items, as well as offer loans with items used as collateral. If the loan isn’t paid in time, the collateral is kept and sold.
Online Pawn Shops
Online pawn shops vary only slightly from the typical kind. They function similarly, but allow customers to conduct business from their homes. Whether it’s to sell or offer an item as collateral, the customer will ship the item and receive their payment or loan if the sale/loan is approved.
Items collected by these shops will then be showcased online to potential buyers, similar to any other e-commerce website. This allows for pawn shops to keep up with the online shift of retail and cut back on expenses (such as a store front). Buyers may also appreciate an easier way to browse through a pawn shop’s content.
Specialty Pawn Shops
Most pawn shops take any item as collateral for a loan, but, occasionally you’ll find pawn shops that have a specialty. Generally, the owner is an expert or they employ an expert in a certain field to verify the legitimacy of items.
This is often seen with jewelry. Why? Because it takes special tools and a trained eye to tell real from fake, or natural from synthetic.
You may also find the occasional gun, classic car, or antique pawn shop. These varieties are more popular in larger cities, which can support such specific pursuits.
Auto Title Loans
Pawn shops are very different from banks when it comes to passing out loans. Customers don’t need a credit score to secure a loan – just something to offer as collateral.
An auto title loan from a pawn shop is like taking out a second mortgage on a house, where you place your car up for collateral, but you can continue to own and use it.
This can be appealing to those without many valuable items. However, it has the downside of potentially losing your mode of transportation if you default on the loan.
Buying secondhand jewelry can be more interesting and fiscally responsible than buying new jewelry.
Though not a one-to-one comparison, it’s like buying a used car: the price of being new is marked up by the company and often not reflective of the actual value.
But there are more factors than just price when buying secondhand!
Are you in search of more bling? Then here are other great reasons to check out antique stores, pawn shops, or jewelry stores that sell secondhand.
A Better Deal
There’s this prevalent idea in modern culture that the value of jewelry is reflected in its price. So, obviously, if the jewelry is cheap, then the quality is poor. Right?
Not true! Buying secondhand jewelry from a pawn shop, thrift store, garage sale, or other kind of secondhand seller shouldn’t be viewed as a lesser way of purchasing jewelry.
Because they’re older (and sometimes less desired than certain modern designs), the price gets significantly marked down. A similar item at a jewelry store could be much cheaper at a pawn shop. If you’re looking for a wedding ring, a gift, or something for yourself, a good piece of jewelry doesn’t have to break the bank.
Sustainable and Ecofriendly
Not all jewelry can be or should be melted down and recycled into new jewelry. Because it’s made with precious and semi-precious resources, it can last quite a while and will end up in a store to be sold again.
Buying these older pieces (instead of putting in the energy and resources to melt them down to make something new) is much more environmentally friendly for the world-conscientious consumer.
Additionally, buying secondhand jewelry allows someone to buy jewelry without supporting the companies that strip-mine or provide poor working conditions for miners, like the mining of “blood diamonds.”
Though there’s a chance that a piece bought secondhand was made by a company that dealt in these practices, they don’t get a cut of the sale when resold. So, you wouldn’t be actively supporting them.
Jewelry goes through fashion cycles, just like clothes and hair styles do. This means that certain a style of jewelry can go out of fashion in jewelry stores. To find something a little more unique or not currently available in stores, buying secondhand increases the variety of pieces to choose from.
Additionally, many of these older pieces bring with them this aura of history, depending on how old they are.
Another term for secondhand (depending on age and perhaps a few other arbitrary factors) can be “antique.” Antique can describe your grandmother’s wedding ring or a locket found in a trunk dating back to the American Civil War.
Not all antique pieces need history to them, though it can be romantic and fun to know the history of a piece that has traveled the years. It’s maybe been around longer than you have! This added value can make a wedding ring or congratulatory set of earrings all the more meaningful.