Need a cash loan?

Financial institutions like banks are reliable places to get loans, but so are pawn shops. While pawn shops typically don’t offer loans above $100,000, they’re a great resource if you need quick cash. Many emergencies fall below this threshold, making pawnshops an excellent option for securing loans. 

Banks and other lenders are notorious for the massive amounts of paperwork needed to process a loan. They also conduct several checks before approving the loan application, making it a lengthy procedure. Fortunately, pawn shops resolve many of these institutions’ pain points and come with numerous benefits. Here are X advantages of taking out a loan from a pawn shop:

They’re Quick to Process

One of the most notable advantages of pawn loans is how processing only takes a few minutes. Bank loans typically take weeks to approve and process loans; meanwhile, pawn loans process and approve them on the spot.

Pawn loans work a bit differently from bank loans. They require collateral, which is an item that you will exchange for the amount you need. The loan is typically a fraction of your item’s value. 

When both you and the pawnshop agree on an amount, they will take your item and immediately hand over the cash. This lightning-speed process will have you walk out with your much-needed loan within the same hour you requested for it.  

They Don’t Check Your Credit

Another reason pawn loans are popular is that pawn shops don’t check your credit score. It doesn’t matter to them if you have a negative credit score; all they care about is the collateral. Most times, they won’t even ask about your credit rating.

The collateral you bring is enough to provide security for the loan. The only requirement you’ll need for a pawn loan is a valuable item, like a diamond ring or a precious vase. These items don’t need to cost millions, especially since pawn shops tend to prefer $100,000 loans. 

They Don’t Impact Your Credit Score

Since pawn shops aren’t concerned about your credit score, pawn loans don’t affect it. Late payments to bank loans and lending institutions reflect on your credit rating, making it more challenging to borrow money. A lower credit score may leave you stranded to look for funding in case of emergencies, which can be incredibly stressful.

Fortunately, that isn’t the case with pawnshops. Since they don’t ask nor care about your credit score, it remains unaffected by all the pawn loans you take. If you want to steer clear of bad credit scores, many recommend using pawnshops instead, especially when small loans are concerned. 

They Offer Multiple Loans

Pawn shops allow you to take as many loans as you want or even each day of the week. The only thing you need to bring with you is new collateral for each loan request, allowing you to ask for a new loan as many times as you want. 

Flexible loaning is usually found in pawnshops. Other lenders won’t approve loans until you pay off the previous one. All pawn shops need is collateral as security, and you can take multiple loans as required.

They Don’t Punish You Like Banks Do

Failing to pay a bank loan at all or on time will negatively impact your credit rating. The impact of this will make it even harder to borrow from other financial institutions, as they’re highly dependent on your credit score. Thankfully, this consequence doesn’t apply to pawnshops. If you don’t pay your loan, the pawnshop will simply take full ownership of your collateral. After selling it, they’ll use the proceeds to cover the amount of your loan.

Since this doesn’t affect your credit score, you won’t have to worry about your rating or any legal consequences. However, you’ll have to accept the loss of your item, mostly if it was a family heirloom. It’s best to pawn an object that’s precious in its price tag but not in its sentimental value.

Conclusion

Sometimes, unexpected events will have you looking for emergency funds. Luckily, pawnshops are a reliable source for small loans regardless of your credit score. With these five exceptional advantages to pawn loans, you’ll have a safe and secure way to get cash in an instant.

If you’re in a pinch and need a cash loan in Owensboro, KY, visit us at River City Pawn! We have pawn shops all over the Bluegrass state, giving you instant access to quick personal loans in Henderson, Madisonville, or Leitchfield. All our stores buy and sell items and offer pawn loans. Find the nearest River City Pawn Shop branch to you today!