The following is a guest post
If you’re a bit stuck for money, then going to a pawnbroker could seem like a quick and easy way to make some cash. There are lots of them out there on the high street, like H&T Pawnbrokers, but how exactly does it work?
Well, you have two options. You can either sell the things that you take with you to the pawn shop, or instead you can deposit a valuable item that can act as security for a loan you take out with a broker.
If you choose to pawn your items to the pawn broker then make sure that you ask them what the fees and interest rates are so that you know the full amount that you will have to repay. The pawn broker should value your item and give you a ‘pre contract information document’. Then you will be given a document that details how long you have to pay back the money that you borrowed. The repayment period will typically be a time frame of six months, and this is usually always the minimum amount of time you will be given to pay off a loan. You have 14 days to withdraw from the agreement, and you can also may early repayments if you wish.
You will then be given a ticket which proves that you own the items that you are pawning. When you get given a ticket for the item that you are using to secure your loan, it is important that you keep this so that you can get your things back after you have paid back the money.
Be sure to also check if the store operates a lost ticket or receipt fee before you agree, in case you lose this.
If you do not it pay back in time, the broker could then sell the items, after giving you written notice, to make back the cash that they will have lost. If this doesn’t cover the full amount which you owe, you will still have to pay of the remaining money. However, if the money raised is more than what you owe, then the excess will be returned to you, unless the loan was less than £75 over a period of six months.
It is advised that if you do decide to use a pawnshop, that you choose one that is part of the National Pawn Brokers Association, because they have guidelines for all of their members to follow.