Are you in need of a small loan to pay something off? Looking for a temporary way to make some cash that you can break up the payment for? If so, then you should consider a pawn shop loan.
It allows you to pay off certain things in your own time frame. You no longer have to strap yourself for cash on a month by month basis.
There are several key benefits of pawn shop loans that you might be interested in. See below for several advantages of receiving pawn loans and why you should consider them for your need.
1. Instant Cash
You’ve undoubtedly heard the horror stories associated with getting a loan. The process for most loans is way longer than it needs to be.
Fortunately, pawn loans offer an instantaneous cash option. You simply bring in your form of collateral and bring it to the pawnshop worker. They’ll value your item and exchange it for the money that you need (which will be a certain percentage of the item’s value).
If you agree on the amount that they’re offering you, then they’ll hold on to your item as collateral and give you the amount they offered in cash.
There’s no lengthy application process or interviews that you have to go through. You simply bring in the item and receive the cash that you need.
Be sure to read this article for what you can expect if you’re looking to use a pawn loan for vehicles.
2. Easy to Understand
Yet another reason that most people fear getting involved with many loan providers is because of the intricate details of each loan.
They fear that they’ll sign the dotted line and get sabotaged by a detail in the contract that they missed out on. After all, with so much else to worry about in your life, you won’t always remember the terms of your loan.
Receiving a pawn loan eliminates that risk. Pawn loans are super easy to understand, as they require few details to begin with. Even so, the pawnshop merchant will give you a receipt that includes all the terms of your loan on it.
Most of these terms simply apply to the loan’s amount, payment plan length, and any other terms that you’ve agreed to. You can review the details before you leave, but rest assured, the pawn loan’s specifics will be straightforward and easy to remember.
3. Doesn’t Impact Your Credit Score
Pawnshops are one of the few places that don’t use credit checks. This can help you in several ways. First, you can still receive the cash advance that you need, regardless of your current credit score.
Second, the loan at pawn shops won’t have an impact on your credit rating. if you even so much as have a late payment on a loan with a bank, your credit score will be affected.
Getting a pawn loan will be far more lenient. Sometimes life happens and you can’t make a payment on time. The important thing is working with your loan provider (in this case, the pawnshop) to pay back the loan in a timeframe that works for both sides.
Even if you have a late payment or two, your credit score won’t be affected. However, if you make a habit of late payments on your loan, they have the right to take full ownership of the collateral you used.
4. Short and Sweet
Pawn loans are only used on small cash amounts a majority of the time. The average pawn loan is only about $75 to $100.
They are also only a maximum of 30 days long. Therefore, you’ll get the opportunity to pay that debt off quickly and get your collateral item back that much faster.
In the same time that it takes you to apply and be approved for a loan with most banks, you will be halfway towards paying off your pawn loan.
This allows you the chance to get the cash that you need with a little more time to pay it off. However, you won’t have to expand it so long that interest continues to pile up.
Whether the money is used towards paying off a bill or something in your business, you can pay it off quickly and get back to your normal budget that much faster.
5. They Don’t Jeopardize Your Lending Future
As previously mentioned, life hits hard some times. If you take out a loan with a bank and have complications, it can ruin your chances of lending from a bank for larger loans in the future (such as a mortgage, car loan, etc.).
With pawn loans, you can avoid having to lend from a bank for smaller cash amounts that you need. Better yet, you can take out as many as you need and it won’t ever affect your credit score.
That way, if the time ever comes where you need to lend from a bank, then your credit score will meet their standards. No matter how many pawn loans you’ve taken out, the slate will be cleaned in the bank’s eyes.
Unlock the Benefits of Pawn Shop Loans for Your Needs
Now that you’ve seen the benefits of getting pawn shop loans for your financial needs, it’s time for you to try it out for yourself!
Be sure to consider what items you use as collateral for your pawn shop loan. Don’t use anything that you’d consider invaluable, such as a family heirloom or something else of high sentimental value.
Make sure to browse our website for more articles on receiving loans, as well as many other helpful topics!