What is a pawn broker?
A pawnbroker is a person or a business who offers loan to people who needs to borrow money in exchange for items set as a collateral. Collateral is also called pawned item or pledges. There are many pawnbrokers in Patchogue, NY who realize the advantages of being a pawnbroker that made them decide to establish this type of business.
Once the pawned item is received by the pawnbroker, he must secure a contract signed by him and the borrower that serves as a written agreement. The contract contains the terms and conditions or returns policy. Included on it is the date of the coverage of the contract, the interest rate on the borrowed money that should be paid every month, the type and description of the item pawned, and many other important details both parties should agree upon.
You must also keep a copy of the contract and a receipt so you can identify the item easily once you claimed it or if you can already return the money you borrowed. If you cannot pay the loan back to the borrower, he can sell the item to recover the money you borrowed. Most of the time, the item can be sold to another person more than what you originally owe.
Some pawn shops may agree to extend the contract provided that you consistently paid the interest rate of the loan. The pawnbroker will quote you the interest rate and you are required to pay this amount together with the amount you borrowed from him. Normally, you need to pay the total amount you loan instead of breaking it into installment basis.
You can either pay for the loan before the contract ends so it will not be a burden for you to pay for interest rate every month. When you have to borrow money from pawnbrokers, they do not need to conduct a credit or background check. This is easiest for both of you as it does not require more paper works or waiting time before you receive the money.
As soon as you provided the item and receive the money, the contract automatically takes effect. It is a quick and hassle-free way to borrow a money instead of going through bank transactions and strict compliance of background and credibility checks. He can also allow you to redeem the item anytime within the contract provided that you paid the full amount of loan as well as the interest rate.
It is also risk-free for you because the pawnbroker is responsible for evaluating if the pawned item is pure or not. Nowadays, through the power of the latest technology, pawnbrokers can easily identify of the pawned item is pure or not because they also invested for advanced tools to make the evaluation easier and quicker for them.
This is risky for pawnbrokers so investing for a tool is very important because if the item is proven wrong, then it cannot recover the cost of the debt. Skillful and expert jewelers may not realize the importance of a tool but it is still better to be cautious.