Pawn Shop Loan Questions

June 29, 2022
Pawn Shop Loan Questions

If you need quick cash and have an item of value to put up as collateral, you may qualify to obtain a pawn shop loan. These short-term loans can be a quick, easy solution if you run into financial stress. To follow are a few answers to some of your pawn shop loan questions.

At Lending Bear, as a state-licensed lender with an A+ Better Business Bureau rating, we offer no-hassle, transparent, and accessible loans to borrowers with all types of credit history. In this guide, we offer some answers to frequently asked pawn loan questions.

What is a Pawn Shop Loan?

A pawn loan is also known as a collateral loan. The borrower puts up a valuable item as collateral for the duration of the loan. The lender assesses the value of the item and keeps it in a secure location until the loan is repaid in full.

A pawn loan is different from a title loan since the borrower is usually able to remain in possession of the vehicle for the duration of the loan. At Lending Bear, we only obtain possession of the vehicle if the borrower fails to repay the loan amount.

Who Qualifies for a Pawn Loan?

If you own a valuable item and are at least 18 years old, you can use that item as collateral for a pawn loan. These loans are short-term and not low-interest, but they typically don’t require credit or work history checks.

How Do I Apply for a Pawn Loan?

To apply for a pawn loan, you’ll need to bring your ID and collateral item with you to the lender. At Lending Bear, a collateral expert will inspect your item, and determine its value. This value will help determine the loan amount you can receive.

Once approved, you will receive your cash and the lender will keep the item in a secure location until the loan amount is repaid or the item becomes the property of the lender.

When Should I Consider a Pawn Loan?

Pawn loans typically have terms of 30 days, so these loans are good for borrowers who need quick cash on a short-term loan. If you own an item of value that won’t disrupt your life to have in the lender’s storage, then you can obtain quick cash without a hassle. If you have poor or limited credit, pawn loans can be a solid option as credit and work history checks are not typically required.

Make sure you have a plan to pay back the loan on time, in full, including interests. These are not low-interest loans, so factor this into your repayment plan.

What Items Can Be Used for Collateral?

You can put up practically any item you own of value to put up as collateral. This can include jewelry, electronics, machines, tools, instruments, and for some lenders, firearms.

At Lending Bear, we are a state-licensed lender and licensed firearms dealer, so we can accept legally owned firearms as collateral. At our locations, firearms are safely secured with cable locks in designated storage areas.

What Happens to My Item During the Loan Duration?

During the duration of the loan, typically for 30 days, the collateral item is stored in a secure location owned by the lender.

At Lending Bear, our storage locations are securely protected and we are insured for the costs of the valuables we store. Once the loan is repaid in full, the lender returns your item to you safe and sound.

What Happens If I Need More Time to Repay the Title Loan?

Some lenders offer payment extensions for your title loans. At Lending Bear, we offer the option of extending your title loan another 30 days after the end of your loan term.

However, if you don’t seek an extension or pay back the loan, we can collect your item as payment for your loan.

Contact the Pros at Lending Bear

At Lending Bear, we offer safe, secure pawn loans to borrowers with all kinds of credit, including poor or no credit history. We hope this pawn loan FAQ has been helpful, and if you own an item of value and need quick cash, contact us today.