Every day across California, countless people walk through the doors of their local pawn shop wanting to sell their used jewelry. However, many of them might be surprised to learn that the pawn shop won’t pay them top dollar for their watches, rings, or earrings.
So, how exactly does a Los Angeles used jewelry store determine the value of a piece of jewelry? The answers might surprise you.
The experts at Maxferd are here to explain everything you need to know to ensure you get the most money for your pawned jewelry.
Used Jewelry Mark Ups
Firstly, it’s important to remember that pawn shops are first and foremost small businesses. They don’t exist simply to pay you the full market value of your used jewelry. That’s because pawn shops have to turn a profit by selling gold, jewelry, and other items to keep their doors open.
Pawn brokers don’t always “mark up” the items they purchase from customers. However, they do need to recover the item’s market value. This is especially true if you default on your collateral loan.
For instance, if your necklace has an open market value of $400, a pawn shop won’t be able to offer you a $400 loan. If you can’t pay your loan, the broker needs to resell the jewelry to recoup their losses. That’s why pawn shops will offer you less than full market value for your items.
How Does a Pawn Shop Valuate Jewelry?
Now that you understand how pawn payments work, let’s take a look at how pawn brokers determine the value of your used jewelry.
When evaluating a piece of jewelry and ensuring that it’s real, the pawnbroker will examine its composition, look at any stones it might have, and check its purity.
Let’s take a closer look at a pawn shop’s jewelry evaluation process.
Jewelry Composition and Purity
One of the first things a pawnbroker will do is determine the composition of the used jewelry. The kind of metal it’s made from and the current demand significantly influences the value of the jewelry. For example, you might bring a sterling silver bracelet into a pawn shop that’s in great condition. However, it can’t compete against the value of gold.
If you’re trying to pawn a subset of gold, the subtype will also impact the jewelry’s value. Yellow goal reaps the highest profits. Rose, green, and white gold will be considered less valuable. That’s because yellow gold is the purest of the four subsets.
The purity of gold is measured in karats, which are represented by the letter ‘K.’ Gold jewelry can be 9K, 14K, or 24K. The higher the karat, the higher the value of the gold jewelry. In fact, 24K gold is generally twice as expensive as its 14K counterpart.
Types of Stones
If the jewelry has any stones, they could influence its value. Precious stones such as diamonds, sapphires, rubies, and emeralds are the most sought-after. Semi-precious stones, including pearl, amethyst, jade, and turquoise will also play a role in determining the item’s value.
The stone’s weight and color will also determine the value of the jewelry. One large, heavy stone might be worth more than several smaller ones.
Some additional factors that can determine a piece of jewelry’s value include its craftsmanship, condition, make, and history. A piece that was owned by a notable person and has been authenticated as such or one designed by a renowned jewelry designer can fetch more because of those kinds of associations.
Evaluation vs. Appraisal
One thing that people often get confused about when trying to pawn their used items is the difference between jewelry evaluations and appraisals.
During an evaluation, the pawn broker will refer to the jewelry‘s true market value, or the price it will go for in the marketplace. On the other hand, a jewelry appraisal is used for insurance purposes. Appraisals are based on the approximate replacement cost of the item.
Let Our Experts Evaluate Your Jewelry
If you’re thinking about pawning your used jewelry, contact the experts at Maxferd today. We offer free walk-in jewelry evaluations and will provide you with an accurate quote for the item’s fair market value. We’ll also make you an all-cash offer for the value of your jewelry. You can then get fast cash, obtain a collateral loan, or walk away.
To learn more, contact us today by calling (800) 888-PAWN (7296). We’re proud to serve the communities of Beverly Hills, Lawndale, Van Nuys, Woodland Hills, and San Francisco.