Pawning is often seen as a last resort for those in need of quick
cash. Surprisingly, however, it can be a better option than traditional
forms of borrowing like payday loans, credit cards, and over-drafting
bank accounts. All of these may come with hidden fees and conditions
many are unaware of until it’s too late. This is why pawning merchandise
at pawnshops is better than (often) predatory forms of obtaining money.
Pawning is straightforward and easy to understand. This is why people
have used pawn shops for thousands of years!
One significant advantage of pawn shop loans over title loans and
bank loans is the flexibility they offer. When it comes to pawn shop
loans versus bank loans, pawn shops shine. They provide an accessible
avenue for those seeking personal loans to address their immediate
financial needs. Pawn shops understand that everyone's circumstances are
unique, and they tailor their loan amounts and repayment terms
accordingly. Whether you need a small loan to cover an unexpected
expense or a larger sum for a significant financial commitment, pawn
shop loans can accommodate your needs. With a streamlined application
process and quick access to cash, pawn shop loans are the ideal solution
for individuals looking to navigate their personal finances with ease
and efficiency.
Let’s take a look at pawn shops and see why they’re better than other methods of obtaining fast cash:
1. Cash in minutes
If
not wanting to part with your old merchandise forever but still want
fast cash, consider a same-day pawn loan. Simply bring in your item of
value, pawn it, pay off the pawn loan (plus any interest), and then get
your item back! Pawn shops can lend you a considerable amount of money
(depending on the item) and may charge a lower interest rate than you’ll
find elsewhere.
Not to mention, it’s almost impossible to obtain a
small loan from other institutions. For example, you generally cannot go
to a bank and receive a small dollar loan; loans are typically for big
purchases like a house, car, or business. Pawn shops offer cash
solutions that other businesses often cannot. The best part is that
there’s no waiting around to get your money - EZPAWN can give you cash
in as little as five to ten minutes.
2. Lower Interest Rates
Pawn shops typically charge much lower interest rates than payday lenders or credit card companies1. This can save you hundreds or even thousands of dollars in the long run.
3. No Credit Check Required
Pawning
does not require a credit check, making it a great option for those
with bad credit or no credit history. This is one of many reasons
customers choose pawn shops over other forms of lending. If a customer
doesn’t pay off the pawn, then the pawn shop simply keeps the item
instead of the customer going into further debt. Thus, the requirements
aren’t as prohibitive and customers who are unbanked or underbanked can
get access to money they often otherwise couldn’t obtain through
traditional financial institutions. Lastly, you do not need a co-signer,
the transaction is very fast, and you can walk out with cash within
minutes!
4. No Collections
That’s right!
When you pawn an item at EZPAWN but don’t make the scheduled payments,
your credit will not be impacted. Your account is not sent to
collections because a pawn loan is a secured loan – meaning you obtain
funds by providing collateral for it. You must repay the loan in full,
plus a fee, in order to get your item(s) back. To restate, if no
payments are made, you forfeit the item, and the pawn shop is now able
to sell it to recoup the pawn (loan) given to you. And that’s the end of
the transaction; any unpaid pawn loans are not reported to collections.
This is one more reason why pawn loans are ideal when needing cash!
5. Tax Season
Pawning
can be an especially useful option prior to tax season. If you are
expecting a refund, but need cash immediately, you can pawn items to
tide you over until your refund arrives.
Maybe you’ve got bills to
pay or an unforeseen expense, like fixing your car or house. You can
pawn something of value and then pay off the pawn loan prior to the due
date and get the item back once you receive your tax refund and use it
pay off the outstanding balance.
6. Flexibility
In
some states, you’re allowed to pay back only a portion of your pawn
loan if you cannot pay the full amount that is due on the scheduled due
date – this is called an extension. Compared to payday and other lenders
who automatically take the full payment due directly from your bank
account via ACH (payment authorization that gives the lender permission
to electronically take money from your bank, credit union, or prepaid
card account when your payment is due”2),
pawn shops typically do not require ACH payment and provide the option
to pay a lesser amount than what is due. Note that when you pay just a
partial amount due in the form of an extension, you extend the term of
your pawn loan.
So, if you're tired of the limitations and hurdles that come
with traditional lending options like bank loans, payday loans, and
credit cards, look no further than pawn shops. Pawn shops are the unsung
heroes of quick and accessible cash. Pawn shop loans offer a refreshing
alternative to the red tape and stringent requirements of banks. Unlike
the lengthy application process and stringent credit checks of bank
loans, pawn shop loans provide a straightforward and hassle-free
solution. With pawn shop loans, you can borrow money quickly and easily
without the need for a pristine credit history or a lengthy wait.
Overall, pawning can be a better option than traditional
forms of borrowing due to lower interest rates, no credit checks, and
the ability to keep your possessions – once a pawn loan is paid back in
full. Plus, pawning can be an effective way to get cash before tax
season, when many people need extra funds, to then be paid back once tax
refunds are distributed and applied to the loan balance. This makes
pawn shops a great source for those in need of cash, but unable to get
it from a traditional lender! Visit your nearest EZPAWN today to find out more.
1. https://www.incharge.org/debt-relief/how-payday-loans-work/
2. https://www.consumerfinance.gov/ask-cfpb/i-was-asked-to-sign-an-ach-authorization-to-allow-electronic-access-to-my-account-in-order-to-repay-a-payday-loan-what-is-that-en-1569/#:~:text=An%20Automated%20Clearing%20House%20(ACH,You%20can%20revoke%20this%20authorization
