Top 5 Myths About Pawn Shops- Debunked!

Pawn Shop

Liquifying luxury goods can be a challenging decision to make, especially when your Jewelry is such a personal item to you. A pawn shop is the first thing that comes to mind when you want a fair price to help you get some short term cash flow relief.

However, the myths that haunt the market often make it difficult for people to put their faith in pawn shops.

Here are some of the most popular myths about pawn shops along with why they’re myths and not facts!


Myth 1: Pawn Shops Charge Absurd Interest Rates

One of the most common myths is that pawn shops have ridiculously high interest rates. While it is true that some pawn shops, particularly those that are in the state of Florida, charge interest rates as high as 20 percent, many Pawn shops are regulated by the banking industry.

In the state of Pennsylvania, pawnshops are subject to the same guidelines and interest rates that banks charge which can be quite reasonable and as low as half of a percent per month.


Myth 2: Pawn Shops Function Based On Their Individual Policies and The Rules Set By Them

A lot of people believe that the working pattern of pawn shops is highly unregulated. The common notion is that every pawn shop has its own diverse policies and ways of working- which is not completely true!

The pawn industry is strict and most pawn brokers operate in a heavily regulated industry. All pawn shops must be licensed at a local or state level and their transactions are closely monitored- similar to that of the banking industry.


Myth 3: Pawn Shops Are Pros At Cheating!

The price of second-hand goods always fluctuates depending on the items and their current market status. If we talk specifically about gold and diamond jewelry, they are measured based on the current scrap value of gold and a percentage of the wholesale value of diamonds. Because of the fluctuating values, the amount offered to you on a purchase or a loan may significantly vary within short intervals of time.

Additionally, a pawn shop can only loan based on the wholesale value of an item. Depending on which retailer sold the item there can be a large and legitimate difference between the wholesale value and a branded retail value.

A good pawn shop will always explain to you how and why they came up with their offer and what factors influence the amount of money offered to you.


Myth 4: There’s A High Risk Of Not Getting Your Goods Back

A very common misconception is that pawn brokers make money by selling goods, whereas they actually make money through the lending process. Pawn shops will always want you to repay your loan and re-acquire your goods because the interest you pay is their actual profit!

The more money they lend out, the more profit they make! Pawn brokers are more interested in seeing you become a happy customer who will return to pawn items again.

A good pawn shop will always take care of your item(s) and return them gladly!


Myth 5: Pawning Is A Complicated, Tedious Process

Getting a loan from a pawn shop is much easier compared to getting a loan from the bank! All you need is a driver’s license or a state-issued ID and the items you wish to pawn.

Pawning your items allows you to maintain ownership of your precious items while still getting the money you need!

The best part about pawning your items is that you might get a higher price for your items compared to how much you bought them for- depending on the current market status.

A good pawn broker will always educate you about the industry before talking about his ways of working. Before you decide to proceed with a particular pawn shop, make sure you do a thorough research about its reputation and its policies and read their reviews.

Don’t forget to keep your options open! Always explore the market and compare the amounts offered to you. Broff’s Diamond & Loan Co. is renowned for offering industry-best amounts and has been ruling the industry since 1931.


What Makes Broff’s The Best Pawn Shop In Pittsburgh And Around?

Experience speaks volumes! Broff’s has been a leading pawn shop in Pittsburgh since 1931 and attracts customers from all over Pennsylvania and the Nation because of its simple interest rates and also because of the high amounts they offer.

Broff’s Diamond & Loan Co. is part of a group of companies including a Diamond and Manufacturing Wholesale Company as well as Independent jewelry retailers in the US. Combined there is a global reach from Israel to China allowing us to pay handsomely for your valuables as we sell many items to our global network or back to the end consumer.

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