Faced with a financial need, the most common is that people resort to quick solutions. Despite being a very important decision, the reality is that they rarely take the time to carefully analyze their options.
Unfortunately this can lead to serious problems and cause greater financial complications. If you are thinking of pawning your assets to get some cash, you have to read this.
Loans with collateral: what you need to know before working
Not all pawn shops are the same. In our country there are two types of pawn shops: Private Assistance Institutions and private commercial companies. The former operate nonprofit and the latter are private businesses that must be registered with Good Finance.
They must be legally registered
Pawn shops that are registered before the law must have their adhesion contract in a place visible to the public. Similarly, pawnshops are required to register with Good Finance and register with the Public Registry of Pawnbrokers. If it is a financial company, the pawnshop contract must be registered with the GF.
Together with the loan, they should give you your ticket
At the time of giving the money, the pawnbroker has the obligation to give you a ballot describing all the information related to the terms of the loan. This document must include both the clauses of the contract, as well as the dates, amounts and applicable fees.
Loan conditions vary from place to place
Although in theory all pawn shops operate in the same way, conditions can vary greatly from one to another. For this reason it is important that you compare the interest rate, the extra expenses, the percentage of the appraisal, as well as the Total Annual Cost.
There are extra charges
Some pawn shops make additional charges for storage, appraisal, insurance against theft and mishap, etc. Consider these expenses before leaving a pledge under warranty.
You can lose your assets
When you receive a loan through a pawn shop you run the risk of losing your assets. If the payment term is met and you do not have the money to pay off your debt, the pawn shop will sell your things for sale. Always investigate if there is the endorsement option in your contract.
You must move to the branch
Although it seems obvious is an aspect that you should take into account. Receiving money from a pawnshop implies a trip to the branch, which exposes you by taking with you the pledge to pawn.
Before making financial decisions, find out and compare. If you don’t want to put your assets at risk, you better apply for an online loan. With Good Finance you can receive up to $ 8000 without having to present an endorsement. Know the requirements to apply for a loan on our site.