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Pawnshop Loans: Exploring The Pros And Cons

27 April 2015

Howard Jones

One of the fastest ways to get the extra money you need is to obtain a pawnshop loan. In most cases, these loans can be obtained in a matter of minutes and will require you to meet minimal qualification requirements. However, like all loan products, there are both pros and cons that come along with choosing to obtain a pawnshop loan. By taking the time to review the pros and cons outlined below, you will be able to make a truly informed decision regarding whether or not a pawnshop loan is right for you.

The Pros

There are several unique benefits that come along with choosing to obtain a pawnshop loan. These benefits include:

1. No Credit Or Income Required - There is no need to pass a credit check or submit proof of income in order to qualify for a pawnshop loan. Consequently, these loan swill often be ideal for individuals who are have recently lost their primary income or who have experienced significant financial difficulty in the recent past.
2. Ability To Extend - Many pawnshops will provide you with the ability to extend the length of your loan by simply paying a small financing fee before your original loan term comes to an end. This can be extremely beneficial for individuals who require a bit more time to repay their loan than other short term financing options are able to offer.
3. Widely Available - Pawnshops are located in every state in the country. In fact, most cities will have multiple pawnshops to choose from. This means that no matter where you live, you will be able to find a nearby location where you can obtain a pawnshop loan.

The Cons

There are also some disadvantages that accompany the decision to get a pawnshop loan. These disadvantages include:

1. Short Term - Pawnshop loans are meant to be short term loans. In most cases, these loans will need to be repaid within a matter of weeks. While it is possible to extend the life of your loan, most pawnshops will put a limit on how many times your loan can be extended.
2. Requires Collateral - Pawnshop loans must be secured by the use of collateral, such as jewelry or electronics. If you do not have any collateral to offer the pawnshop, you will not be able to obtain a loan.
3. Limited Funds - The value of your pawnshop loan will be limited by the value of your collateral. This can be a serious problem if you require a large amount of money in a short period of time.

The Bottom Line

If you have valuable collateral and are confident in your ability to repay your loan prior to the original due date, a pawnshop loan from Desert Jewelry Mart & Coins can be the perfect solution to a short term financial problem. However, in the absence of collateral, you will find that this loan option is not available to you despite your ability to repay the loan.

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