When a person needs to sell their valuables for fast cash or wants to buy affordable, high-end jewelry, they might decide to visit their local pawn shop. However, there are many misconceptions about pawn shops floating around out there. These myths could make folks hesitant about buying or selling to a pawn shop.
In reality, pawn shops are legitimate small businesses operated by trustworthy professionals, and the industry itself is heavily regulated. To help put an end to the spread of misleading information, the staff at Maxferd want to discuss the top five pawn shop myths and why they aren’t true.
1. Pawn Shops Buy and Sell Stolen Goods
One of the biggest myths about pawn shops is that they sell or buy stolen items. This couldn’t be further from the truth. On the contrary, pawn shops must closely adhere to all local, state, and federal rules and regulations. Pawnbrokers often collaborate with the police to catch thieves and other troublemakers.
No pawnbroker would put their livelihood or reputation on the line to make a few bucks selling or buying stolen goods as the penalty far outweighs the potential reward.
2. Pawn Shops Sell Outdated or Damaged Merchandise
Another common misconception about pawn shops is that they only sell old, damaged, or outdated items. In reality, pawn shops sell a wide variety of quality merchandise, including rare coins, jewelry, designer handbags, musical instruments, electronics, and more. There are certainly pawn shops that specialize in less expensive items, but this generalization should not be made about the entire industry.
At our San Francisco pawn shop, we offer free walk-in evaluations of your valuable items and jewelry. This ensures we are only selling quality items at our shop.
3. Pawn Shops Are Only for People with Financial Problems
You might have heard that people with hefty financial burdens visit pawn shops as a last resort to get fast cash. While most pawn shops do provide collateral loans and instant cash offers, that doesn’t mean they’re only for financially unstable customers.
In actuality, pawn shops are a convenient way to secure a loan without the risk of negatively impacting your credit score or having to wait for the application process. They offer a convenient, easy way to borrow money for unexpected emergencies, unforeseen expenses, and unplanned events.
4. Pawn Shops Charge Huge Interest Rates on Loans
A problematic myth about pawn shops is that they charge outrageous interest rates on loans. However, this isn’t the case at all. When a person takes out a collateral loan from a pawn shop, they are borrowing against their personal property. If they don’t pay back their loan in full, the pawn shop can try and sell their items to get reimbursed.
At Maxferd, we adhere to the California Financial Code when it comes to our collateral loan services. This means that our loan periods and interest rates are regulated, and you will never be overcharged. We sometimes offer promotional interest rates for new customers and offer the option to “roll over” the loan at the end of four months without paying any additional interest or principal payments.
5. Pawn Shops Only Want to Keep Your Possessions
Many people don’t want to take out a collateral loan from a pawn shop because they think the pawnbroker wants them to fall behind on their payments and forfeit their collateral. On the contrary, it is in the pawn shop’s best interest for you to pay back your loan in full. Pawnbrokers are not slimy con artists who are out to take advantage of their customers. They’d much rather have you make payments on your loan than keep your items than have to go through the hassle of waiting for another customer to purchase them.
Experience the Maxferd Difference
Well, there you have it. There are your five common pawn shop myths debunked. If you want to experience the benefits of doing business with a pawn shop for yourself, visit Maxferd today. Since 1884, our customers have trusted us for jewelry repair and evaluations, collateral loans, and more.