For most people going to a pawnshop for emergency cash is not high on the agenda. It’s not something people look forward to. In fact, next to payday loans, it’s considered a last resort. Be that as it may, pawnshops are just like payday loans. They are neutral financial tools. They only go bad when you abuse this type of financing and use it for wrong reason.
The main drawback, of course, of pawnshop financing is that you get cents on the dollar. For pawning something that may have sentimental value to you, you may think it’s worth a lot of money but the pawnshop would appraise it at a very low rate. If that isn’t bad enough they also charge a high interest rate.
Then if you miss your payments, you won’t get your items back at all nor do you get back the payments you did make. So think twice before using a pawn shop. However, there are three situations where going to a pawn shop makes a lot of sense:
You Need The Money More Than The Item
When you go to the pawnshop to pawn an item, put it in your mind that you are never going to see that thing again. In other words, if you are going to go to the pawn shop and you’re ready to pull that trigger and pawn that thing that you’ve been hanging onto for so long, have the attitude that you’re basically getting rid of it and that you won’t ever see it again.
More than likely that’s what going to happen. So if you have that attitude regarding certain objects around your house, then go ahead and pawn those. You need the money more than you need the item you are pawning anyway.
You Get More From The Pawn Broker
There are many cases when the pawn broker will actually give you more money for the item that you pawn, than if you would have put that item up for sale on Craigslist or eBay. It doesn’t happen all the time but it happens – especially for an item in demand. For example, let’s say it’s summertime and you want to pawn a lawn mower. You’ll get more at the pawn shop for one than you would anywhere else. At Craigslist you’ll have to take pictures and write the ad then wait on people to low-ball you all day. It may not even sell at all. On eBay you’ll deal with eBay fees, PayPal fees and shipping fees.
The great thing about basically using the pawn broker to off-load your property is that the pawn broker will pay you cash and there is no bidding process. The pawn broker will just make a quick assessment and pay you cold hard cash for your item. As long as there is demand for it, the pawn broker will give you money for it.
You Need The Money Right Away
Some items may be worth more if you sold them on your own, but it could be more difficult to sell. For example, if you have a certain antique (let’s say it’s a lamp), you could have trouble selling the item since there is little demand for it. But the pawn shop will buy it on the spot. Sure, it will be for far less than what you want for it, but you will get paid immediately with no hassles.
When you’re in need of cash because of mounting bills, speed is essential and that is exactly what a pawn shop provides.