Banks refuse to do business with about 15 percent of the people who live in the United States. When these people need money, they do not have credit cards or access to bank loans. If they have physical assets, they may turn to a pawn store in Chicago area to get the needed cash. Unlike payday loans that limit the loan amount to the person’s income, a pawn shop loan is limited by the asset that the person puts up as collateral for the loan. The person usually has between 30 and 90 days to pay the loan back. If they fail to make the payments, then the pawn shop owner takes the collateral.
Pawn shop owners are expert appraisers. They will inspect an item and offer an instant appraisal on the item. A Pawn Store has to hold items for 30 days before they can sell them. This gives the police time to contact the pawn shop owner, if the item has been stolen. Because of the need to store items, pawn shops prefer smaller items that hold their value. Gold and silver jewelry, watches, coins and musical instruments are items that pawn shops are usually pleased to see. After the amount of the loan is determined, the pawn broker will also explain the interest rate and the fee that it charges. While the interest rate may be high, it is usually not as high as the late fee charge by a utility or credit card company for a late payment.
There is no credit check because the Pawn Store in Chicago owner has the collateral to secure the loan. The loan is completely confidential, and it will not affect the person’s credit report in any way. People who want to borrow money without anyone knowing about the transaction often use pawn shops. If the pawn shop owner takes the collateral, he does not report it to any of the credit rating companies. There will be no threatening phone calls demanding payment. The borrower does not have to worry about compounding interest rates and paying back a loan amount that increases daily. While he may lose a treasured item, the financial transaction is over.
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