FILLING THE GAP

The Consumer Federation of America found that more than 50% of Americans are living paycheck-to-paycheck. When it comes to financial alternatives, pawn customers do not have many safe, convenient, regulated choices. Pawnbrokers offer the consumer a quick, convenient and confidential way to borrow money. In short, the pawn loan is often the cheapest, easiest way to fill the gap … when the consumer comes up $50-100 short.

To provide their service, all lenders must charge rates commensurate with the size and duration of the loan, collateral, risk and recourse. Pawnbrokers offer non-recourse loans, looking only to the item being pledged to recover their investment if the borrower chooses not to repay the loan. Pawn transactions are small-dollar, short-term loans with no hidden charges. A short term cash need can be met with no credit check or legal consequences if the loan is not repaid. Pawn loans do not cause people to overextend their credit or go into bankruptcy.

Secured short term loans from pawnbrokers are highly regulated,  and all the terms of business are clearly stated in a state-regulated contract.  In today’s society, many people depend on pawnbrokers to help them meet daily financial needs not offered by other institutions. Pawn customers represent the working families of America who periodically experience an unexpected need for short-term funds. Pawn loans keep the electricity on, the rent paid and cars running with full tanks of gas.

This growing, competitive industry is constantly working to enhance the image of pawnbrokers, while offering needed services to their communities. Today’s pawn stores are attractive, welcoming places to do business. Most of them are family-owned and operated stores that offer superb customer service. Although pawnbrokers are primarily small business owners… they can also be larger, publicly traded companies that help to add to the professional status of the industry.

Working with law enforcement helps ensure the safety of pawn customers and their property. Pawnbrokers comply with all federal, state and local regulations and laws. In most jurisdictions, they provide local law enforcement with data on all transactions on a daily basis.

Put simply—customers pledge property as collateral, and in return, pawnbrokers lend them money. When customers pay back the loan, their merchandise is returned to them. Pawn loans are made on everything from jewelry to electronics. If the customer elects not to redeem his or her collateral, there is no credit consequence to the borrower and the items are sold at a value price to retail consumers.