A pawnshop in Russia is a successful credit institution that provides short-term loans secured by vehicles, vehicles, jewelry, equipment and other property. The operating principle of a pawnshop has remained unchanged for five centuries:

1. The borrower needs to obtain an urgent loan.
2. He takes the documents and collateral to the pawnshop.
3. A commercial organization evaluates the collateral and, based on this assessment, makes a decision on the possibility of providing loan funds.

The work of pawnshops can be visually represented as an “equation”:

Need + collateral + documents = short-term loans

Those who are going to use the services of these legal entities for the first time, before applying, need to familiarize themselves with their activities in more detail in order to be sure that this type of lending is the optimal solution to financial problems.

What's the point?

The main operating principle of a pawnshop in Russia, as in any other country, is to make a profit by paying borrowers interest on the loan. Unlike banks, their activities are based on providing only short-term loans with mandatory collateral. The interest rate in this case will be significantly higher, since only a passport is required to obtain loan funds from documents.

Fees for using loans are charged daily, from 1 to 5% per day on average in Russia. For each client, as in banks, individual lending conditions apply, which depend on the client’s reliability, the presence of existing obligations (“open” loans), the desired loan amount, etc.

If this principle of operation of a pawnshop in Russia is acceptable to the client, it is necessary to choose a commercial entity with the most attractive lending conditions. The Internet, outdoor advertising, and reviews from friends will help you make the right choice.

1. The client turns to a pawnshop in order to obtain loan funds for a short period of time. You can use products made of precious metals, valuables, antiques, fur coats, household appliances, cars and real estate as collateral. You must have a passport with you;
2. The pawnshop employee introduces the visitor to the terms of the loan: interest rate, possible amount of collateral, repayment period, accrual of penalties in case of insolvency, etc.;
3. If the client agrees with the principle of operation of the pawnshop, the merchandiser evaluates the collateral: checks for authenticity, operability (for equipment), analyzes the average market price of the product, its condition, demand and date of manufacture. Informs the client about the amount of the deposit;
4. If the borrower agrees with all the conditions, a short-term loan agreement is signed. The client is given a deposit ticket, which specifies all the conditions;
5. From the first day of receiving loan funds until the end of the loan agreement, interest is accrued daily for using the loan.

To avoid delays, you need to make timely payments on your obligations, taking into account all interest. Delays are fraught not so much with the accrual of penalties by the pawnshop, but with the possible loss of expensive property.

What if you don't pay?

What will be the principle of operation of a pawnshop (step by step) in the absence of payment on the loan? Unlike banks, which certainly strive to return borrowed funds by any means through penalties, penalties, arrests and going to court, pawnshops almost completely minimize financial losses, since they issue loans only against the security of citizens’ property. In case of late payment of the loan installment:

• First, pawn shops will inform the client about the need to make a payment on the loan;
• Then penalties and interest will be assessed;
• Ultimately, the collateral property will be put up for sale!

The old owner can now return it only by buying it back at an auction or in an online store, in competition with other buyers. Moreover, the final amount of property will be declared taking into account all penalties and interest in order to fully recoup the company’s financial losses. The period after which the property will be offered as goods is specified in the contract.

Having studied the basic principles of a pawnshop, each client can conclude for himself what is more profitable: to get quick money and worry about returning the collateral, or to try his luck at banks by providing a full package of documents. Each option has its pros and cons, and the final choice depends on how quickly the borrower plans to pay off its obligations.

A pawnshop is an excellent solution as a “loan for a day,” but by signing a contract for a month, the client risks overpaying up to 150% of the loan cost. To avoid the “edge of the financial abyss”, you need to try to buy back the collateral as soon as possible.

Recently, more and more beginners (and experienced entrepreneurs) want to open a pawnshop. Every year the number of pawnshops in Russia increases by 20-25%. At the moment, this is a fairly profitable business with a short payback period.

According to official data, over five hundred pawnshops are registered in the capital. But about 250 companies are actually engaged in this business. 80% of them are private pawnshops, which have supplanted the state network “Mosgorlombard”.

The “promoted” pawnshop is visited by more than 100 people every day. The main contingent is representatives of the middle class. Recently, wealthy people have begun to appear in pawn shops. They usually go there when they urgently need to make another payment on a bank loan - for example, to buy an apartment - but there is not enough cash.

Types of these establishments

Based on the principle of operation, Moscow pawnshops can be divided into two groups.

The first one is classic pawnshops, the profit of which consists of interest on the use of the loan. Their owners are extremely interested in clients purchasing their items, and the percentage of unclaimed balances is minimal - no more than 5-10%. Classic pawnshops, living on interest, prefer to work in “dormitory” areas.

The second group of collateral institutions are those disguised as pawnshops. jewelry buying points. With their help, jewelry companies replenish their stocks with finished products or scrap gold. These pawn shops deliberately price things low and charge high interest rates for the loan. Thus, customers are encouraged not to repurchase their item.

How do pawnshops beat banks?

Firstly, unlike a bank, you can get money from a pawnshop for a very a short time– from 2 minutes to 2 hours, and without guarantors and a bunch of certificates that a bank usually requires. Secondly, banks do not issue microloans, but at a pawnshop you can borrow any amount. True, if a client takes an amount over 600 thousand rubles, the pawnshop is obliged to inform the Financial Monitoring Committee about this.

The work of these establishments is described in the following video story:

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How much can you earn?

A pawnshop with two years of experience in a residential area of ​​Moscow with a population of 60-80 thousand people, specializing in collateral for jewelry, can receive average monthly profit 4 thousand dollars (excluding ). The amount of loans issued should reach $110-120 thousand.

Initial opening costs?

Creating a full-fledged pawnshop requires 1-1.5 million rubles.

Main costs will require covering it with a grille made of special metal wire (from 1 dollar per sq. m), installing an alarm system, and an “alarm” button. At the same time, pawnshops specializing in household appliances and clothing will require special racks for storing collateral, and car pawnshops will need guarded parking. There must be at least two safes in the room - for short-term (no more than one day) and long-term storage of things.

Payback period

The investor must be prepared for the fact that the created pawnshop will be available only after six months of existence, and all investments no earlier than after 1.5 years. By the way, the sixth month is a crisis moment for the existence of most pawnshops. It is at this stage that up to 30% of open institutions cease their work.

Almost all pawnshops that are more than two years old are profitable - unprofitable businesses are closed earlier in their existence.

The following webinar will tell you how to increase the profit of your pawnshop:

How does a pawnshop work?

The loan period is usually one month. Average rate for a loan in Moscow pawnshops ranges from 4.5% to 15% per month.

Interest for using the loan, fees for appraisal and storage of property are charged for the entire period that the items are in the pawnshop when the loan is repaid. If after the expiration of a month the pledgor was unable to redeem the pledged items, then he has the right remortgage them, having previously paid interest on the loan and the cost of storage services for the past period. In this case, the pawnshop stores the pledged items for another month. In this case, a higher percentage is charged for storing and using the loan.

A thing that, after a certain period of time not bought out and not remortgaged, the institution is obliged to keep it for one month, after which a public auction must be held. Moreover, the pledge turns out to be the full property of the pawnshop only after it failed to be sold at both the first and second auctions.

However, a certain part of pawnshops do not use public auctions at all in their work - the collateral is sold through the sales network upon expiration of the appropriate period from the date of non-repayment of the loan amount. True, when selling a pledge, the rule of law applies: the thing cannot go on sale without the executive signature of a notary.

The vast majority of pawnshops specialize in work with jewelry and diamonds. Secured by jewelry, pawnshops issue loans in the amount of 90-95% of their appraised value. First of all, the weight and purity of the precious metal are valued, then the weight and quality of the diamonds. Other precious stones are not valued in such institutions; their weight is subtracted from the total weight of the product. By the way, the weight of precious metal in a pawnshop is measured with scales accurate to the second digit. If the product is not entirely made of gold, then all non-gold components are deducted from the weight: inserts, enamels, lock springs, mechanisms and watch straps.

Compared to “jewelry,” household appliances, computers and natural fur coats occupy a small share of pawnshop turnover. Pawnshops work with this group of goods out of necessity in order to attract more customers, because the more groups of goods a pawnshop accepts, the more attractive it is. As for the benefits from using household appliances, they are small. Technology tends to become obsolete. Therefore, pawnshops give no more than 25-60% of the appraised value for it.

The same goes for clothes. There is no less hassle with it: for example, to store natural furs in a pawnshop you need to equip a special refrigerator.

Place

It is interesting that in Moscow pawnshop establishments bring the greatest profit, located in residential areas, and in most other regions of Russia, firms located in the central part of the locality benefit. Obviously, the difference in living standards has an effect - outside of Moscow, the middle class is most often concentrated in the city centers.

To get as much money as possible in the form of interest, the pawnshop must create conditions, in which it would be profitable for a person to borrow money. What are the conditions? - These are lending rates.

In an area with a population of 20 thousand people, you can work “plus” only with loan rates of at least 25% per month. This is a very high threshold that will drive customers away. But a pawnshop, which has a potential audience of 100 thousand people, can already afford to work at lower rates - from 4%. Therefore, a street with intense human traffic is what is needed for a new pawnshop.

Optimal area premises for a pawnshop - 50-100 sq. m. For a pawnshop planning to accept only jewelry, 20-30 sq. m. will be enough. m.

Equipment

Basic equipment- laboratory scales of a high accuracy class (up to 0.01 grams), which must be certified by the Assay Office. For assessments jewelry requires special equipment, for example, gold and diamond detectors.

For household appliances you will need equipment to check the “technical” pledge: all kinds of testers, sound speakers, headphones, cassettes, disks of all kinds, adapters, adapters, batteries.

Also, for the successful operation of a pawnshop, appropriate software- it significantly reduces the time required to issue a loan and simplifies management accounting.

Staff

Pawnshop staff usually include security guards, a commodity appraiser, an accountant and a manager. One of the key figures in any pawnshop is commodity appraiser. It is he who determines the value of the property accepted as collateral - any mistake of this specialist leads to a decrease in the company's profit.

In addition, the appraiser must be aware of current market prices for precious items, then he can give a loan for the item that is profitable for the pawnshop.

Advertising

As practice shows, the most difficult in a pawnshop’s work are the first three months, during which it is necessary to attract the first customers. If this task is completed, then the pawnshop will begin to bring in the first money and gradually acquire more customers.

Attract visitors A pawnshop company will be helped by low-budget advertising distributed at the company's location. As a rule, such businesses actively use outdoor advertising, as well as advertising in public transport - primarily in the subway and on buses. A pawnshop's advertising budget rarely exceeds 2.5 - 3 thousand dollars per month.

Seasonality

As a rule, traffic to pawn shops increases by 5-10% in autumn and spring. Most often, people mortgage property before and immediately after the summer holiday season, as well as in the period before and after the holidays.

Inevitable risks

The main risks of this business are related to the reception and storage of rental property. Especially a lot problems arise with jewelry. There is a lot of gold on the market that does not match the hallmark applied to it. If the outside of the ring is covered with gold plating, and the inside is cheap metal, it is very difficult to recognize a fake. An equally pressing problem is stolen gold. It is difficult to determine the criminal origin of “jewelry,” so any item is accepted as collateral. If stolen gold is confiscated, the pawnshop's costs are not reimbursed in any way.

The same risks apply to car pawnshop. It is not always possible to establish the purity of the origin of the car; it happens that already during storage, information appears that the car has not been properly cleared by customs or is listed as stolen. To resolve such issues, it is important for the pawnshop manager to have good connections with the traffic police, the prosecutor's office, the court and customs.

In addition, property stored in a pawnshop may become unusable. Computer and cell phone batteries run out, car electronics fail, etc. The owner is responsible for all this. To protect yourself, it is better to insure all possible risks.

An interview with the owner of a large network of pawn shops is presented in the following video material:

In the current conditions of the financial crisis, many people are faced with the acute problem of lack of money. Realizing that a certain amount is missing for an urgent purchase, most apply for a bank loan or borrow from friends and acquaintances. But there is another category of people who go to a pawnshop for a loan secured by jewelry or other valuables. They rightly believe that a pawnshop is the best opportunity to quickly get a short-term loan. After all, not everyone has additional or generous relatives who can provide assistance at the right time.

What is a pawnshop?

Those who do not know what financial difficulties are are unlikely to be able to understand why people go to pawn shops. Of course, if a person urgently needs money and has no one to borrow it from, you can sell some of the things. But not everyone wants to part with their favorite things, and then people give them as collateral with the possibility of later redemption.

A pawnshop is a legal commercial institution whose activities are based on mortgage principles. Everything here is quite simple: a person in need of money, in exchange for a certain amount, leaves a value belonging to him as collateral. Upon completion of the pre-agreed terms, the mortgagor has the right to redeem his property by paying for it the previously received amount and the interest accrued during this time. Only personal items can be left as collateral, including precious metals, household appliances, vehicles, electronics and jewelry. Recently, the so-called watch pawnshop has become especially popular, providing an opportunity to profitably pawn or sell luxury Swiss watches.

What do we give and what do we receive?

You can only get money for things that have a certain value. The amount of cash issued by a pawnshop is determined taking into account the real value of the collateral provided. Obviously, the assessed value will be several times lower than the amount you paid when purchasing the rental property. Before you pawn your favorite item, you need to think it over carefully. Indeed, if the mortgagor fails to pay the agreed amount, the establishment will have to sell the collateral, and this is associated with many ongoing expenses. Therefore, you should not naively expect that for your brand new tablet worth 500 dollars you will get at least 400. In reality, the amount will be much less, and in different pawn shops the estimated value of the same thing can differ significantly.

When returning the collateral, the borrower will have to pay not only the previously received amount, but also a certain percentage. The terms of payment and the rate for using money in different pawn shops can vary greatly, and this needs to be found out in advance. It is worth noting that the interest rate is quite high, therefore it is beneficial to cooperate with such institutions only in case of a short-term loan.

Pros and cons of going to a pawnshop

One of the main advantages of going to a pawnshop is the speed of the transaction. To receive the required amount, it is enough to have some valuables and a passport. It takes no more than half an hour to complete the documents. The second argument in favor of such cooperation is accessibility and simplicity. This is especially true for people who work without official confirmation of income or have a bad reputation in banking institutions.

In addition to the above advantages, working with pawn shops also has a number of significant disadvantages, one of which is the high interest rate charged for using a loan. However, if we are talking about that amount will not be too large. In addition, the equipment pawnshop does not issue large loans.

Rights and obligations of the borrower

To use the services of a pawnshop, you need to provide not only collateral, but also a passport. Upon completion of the assessment procedure, an agreement is concluded with the client. The pledgor receives cash and a pledge ticket - a document that allows you to redeem the abandoned item. It must indicate the address of the pawnshop, by whom and to whom the ticket was issued, a description of the pledged property, the amount received by the client and the timing of its return.

If, after the agreed time, the client does not redeem his item, then a month after the end of the contract, it becomes the property of the establishment.

How to get money without becoming a victim of fraud?

Before concluding an agreement, you must make sure that the pawnshop has all the permits. There must be money in the cash register. Their absence should be a reason to refuse to deal with such an establishment. The level of work and environment of the pawnshop plays an important role. Many modern institutions have payment machines.

In addition, one of the common tricks that an unscrupulous pawnshop resorts to is increasing the interest rate. Therefore, it is very important to read it carefully before signing the contract.

Today the “Pawnshop” sign can be seen in almost every block. The onset of the crisis contributed to the growing popularity of pawnshop organizations that are ready to quickly and without unnecessary red tape lend money against collateral. There are almost 20 thousand retail distribution points throughout the country, owned by about 7.5 thousand companies - legal entities. Analysts predict a doubling of the number of such facilities by 2020. There are now about 35 thousand bank offices.

The House of Lombardi, the first loan and collateral bureau, which gave its name to pawnshop establishments, was opened in Brussels in 1618 by moneylenders who came from the Italian province. In the Russian Empire, private points appeared towards the endXIX century. The nationalization of the banking sector after the 1917 revolution led to the liquidation of the pawnshop business. 70 years later, since the 1990s, pawn shops have reopened in the country.

Principle of operation

Pawnshops, private or public, issue loans to citizens secured by any property. The borrower receives money for the appraised item and uses it at his own discretion. Upon expiration of the appointed period, he must repay the debt and pay the cost of lending services (interest, commission), then the deposit will be returned. If the client does not purchase the property, it will be sold. You can also re-mortgage the item for a new term.

Pawnshop institutions operate in accordance with the law “On Pawnshops” with mandatory licensing of the conditions of financial activity. At each dispensing point the following must be placed in a visible place:

• license (registration data);
• text of the law;
• management contacts;
• price-list.

Pawnshops do not cooperate with credit bureaus and do not transmit any information about borrowers to them. So users can rest assured that possible delays on pawn loans will not affect their credit reputation in any way.

What do they take?

You can pledge a wide variety of valuable property:

• jewelry, jewelry, precious stones, precious metals;
• leather and fur products;
• objects of art;
• silver plate;
• crystal and porcelain dishes;
• antiques;
• cars;
• electronics, household appliances.

Most pawn shops only deal with jewelry. In the last couple of years, the number of specialized car pawnshops has increased, today their share is about 10 percent. Approximately the same proportion of points are engaged in furs and equipment.

There are very few pawn shops that evaluate and accept precious stones, due to the low possibility of selling these products in the future. Stones can be severely damaged, and reprocessing to prepare for sale is difficult and unsafe for the quality of the product. Some pawn shops accept diamonds for appraisal.

Rarely do any points accept art objects, antiques, artistic products, since there are very few qualified specialists who can correctly evaluate these things. Mostly, oversized items are accepted as collateral, which can also be easily sold if necessary. And of course, you shouldn’t carry unnecessary, low-value items; pawnshops don’t accept junk.

Who uses the services

Users can be divided into two categories: those who urgently need money for some urgent needs, and migrants. There are regular customers who regularly pawn and buy back their belongings, and there are those who resort to the services of pawnbrokers very rarely. Entrepreneurs, businessmen, realtors, pensioners, students, collectors, and resellers take loans against collateral. Sometimes visitors come to evaluate the value of gifts from ex-boyfriends, so that they can later pawn or sell these things.

Seasonal influxes of customers occur on the eve of the New Year and during the holiday season from late spring to early summer and September. During the week, the most visitors are on Mondays and Saturdays.

Who evaluates it and how?

The value of the collateral is determined depending on various indicators. The merchandising expert focuses on the market value of similar items, the brand; takes into account the degree of wear, relevance, etc. The client should be prepared that the item brought will not be valued at the same price as it was purchased for. The appraiser can name a much smaller amount - 1.5–2 times or more.

Jewelry is usually assessed only taking into account the cost of gold itself per 1 g, without stones. The reference point is the price of the metal on the London Stock Exchange. There are several methods for diagnosing a product. In each organization, the manager himself determines which one to use. Most often, precious metals are diagnosed by applying alkaline or acidic reagents to the cleaned area or to a cut on the product.

When handing over antiques, the client may be offered three options for receiving money. The first is the loan itself, i.e. the amount borrowed against collateral. The second is a slightly higher price at which the pawnshop will buy the item immediately for cash. Well, the third is how much the product can be put up for sale in a store. In the latter case, the price will be most favorable for the owner of the antique, but the receiver cannot know exactly when the item will be bought. The client will receive his money only after the sale and minus commissions. The difference between the prices of these three options can sometimes be twofold.

According to the rules of operation of pawnshops, receivers must have certain knowledge and skills both in the legal framework of the activities of pawnshop institutions and document flow, and in specific industries - gemology, physical chemistry of metals, and also be able to work with clients. The specialist must be able to apply all this in 10–30 minutes of working with the visitor. In reality, unfortunately, the personnel problem is very acute. Today, there is only one organization in the country that trains expert appraisers. At the same time, not all workers, and their managers too, are ready to engage in education. Therefore, quite often things can be valued incorrectly, including at a loss to the pawnshop.

Documentation

To receive a loan, you need to come with the item intended to be pledged and your passport. After evaluating the product, a contract is concluded with the client. The document is drawn up in two copies: one - to the borrower, the other - remains at the reception point. The “Pledge Ticket” indicates:

• borrower data;
• pawnshop details;
• product description;
• the amount at which the item is valued and the loan amount;
• interest rate;
• dates of loan issuance and repayment.

When repaying the loan and purchasing the product, the client must present a passport and a deposit ticket.

Price issue

The Central Bank limits the daily interest rate for pawnshops - today it should not be higher than 0.46%, which in annual terms is 167.9%. For comparison: annual rates on bank loans for consumer needs do not exceed 30%.

For example, the borrower brought an item worth 10,000 rubles, for which he was given 5,000 rubles. for 10 days at 0.5%. After the appointed period, the client will be able to pick up his property by paying 5,000 + 5,000 x 0.005 x 10 = 5,250 rubles. The service fee is 250 rubles. The longer the loan term, the higher it is.

If a person does not redeem the pledge by the appointed date, he can re-pledge the item by issuing a new pledge ticket. And after using the money you will need to pay interest.

Secured loans are issued for different periods, even for a year, but most often it is a week or a month. If the client does not pay the pawnshop on time, then there will be a grace period for another month during which the pawned item can be redeemed.

If the deposit is not redeemed

You won't be able to forget about debt. A few days after the borrower missed the date for returning the money, the pawnshop will send him a notice with a reminder. However, not all items handed over are bought back by the owners. In 10–30% of cases, property remains unclaimed. If the client does not pay anything to the pawnshop and does not take back his item, then the parties to the transaction will each have their own things: the unredeemed collateral will become the property of the pawnshop, and the borrower will have the loan funds.

Lenders, of course, are interested in the client repurchasing the collateral, since they make money on loan interest. Otherwise, they have to spend money on selling the collateral. When the cost of the product is less than 30,000 rubles. the pawnshop can sell it at its discretion. To sell more expensive items, public auctions are required.

If the item being auctioned is sold at auction at a price exceeding the loan amount, the borrower must be returned the difference minus interest and commissions. When selling at the minimum price, the client will receive nothing. But in any case, debt obligations to the pawnshop will be cancelled. The owner of the pledge himself can take part in the auction; perhaps he will be able to profitably purchase the pledged item. You can try to purchase an item at an auction at a low price with the help of friends in order to get the item back with a win in money and closure of obligations. However, the likelihood of such a trading outcome is difficult to predict.

Pawnshops can sell unredeemed jewelry from their counters or through stores. If the product turns out to not meet the requirements (without the manufacturer’s mark, part of the whole, etc.), it will be sold as scrap precious metal to a refinery. But items offered for sale from pawn shops in 90% of cases are new, without signs of use, and of good quality, because they are checked during evaluation, and low-quality items are not accepted. But their prices are significantly lower than store prices. For example, gold at initial retail costs 5,000 rubles. for 1 g, and pawnshop - 2,000 rubles. Among the unredeemed items, you sometimes come across designer, vintage, and antique items.

Buyers can simply be private individuals purchasing items they like for themselves. There are also enterprising people who buy products for resale. Craftsmen buy jewelry to first restore, alter or repair it, replace the stone or, conversely, use it for another product, and then sell it.

What about stolen goods?

The opinion about the criminality of the pawnshop business has been around for a long time, but today it has little in common with the true state of affairs. Several years ago, pawnshops, in response to accusations from the Central Bank of the Russian Federation of buying stolen goods and limiting operating hours from 8-00 to 20-00, conducted an analysis and found out that stolen goods are handed over in no more than 2% of cases. The operating rules of pawnshops are similar to banking ones in the sense that clients are checked and serviced with the obligatory provision of a passport, an agreement is concluded, and the borrower is notified of the terms of repayment of the debt. Such requirements and conditions are unlikely to suit scammers.

The main complaint against pawnshops, with which citizens turn to human rights services, is non-compliance with the grace period for purchasing items. Sometimes loan and pledge offices violate the deadline during which they do not have the right to sell the pledged property.

Since 2014, the activities of pawnshops as financial institutions have been regulated by the Central Bank. During this period, as in the banking market, there is a consolidation of organizations and the departure of participants that do not meet the standards of the Central Bank of the Russian Federation. If gross violations of the law are detected, pawn shops are liquidated. This may be failure to comply with the instructions of regulatory authorities, failure to provide reporting on activities. Today, all requirements are unified and reporting is unified, the security and convenience of providing services have become much higher.

Advantages and disadvantages

Negative points include:

• high borrowing costs;
• small amounts;
• short loan terms;
• receiving precious metals at very low prices.

Compared to other options for obtaining borrowed funds, pawnshops have a number of advantages:

1. Fast and easy. No certificates, additional documents, filling out forms or applications, only a passport; registration time is no more than half an hour.
2. The state of your credit history does not matter for obtaining a loan.
3. An opportunity to receive a small amount for a short period of time, which cannot be done in a bank.
4. Rates are lower than in microfinance organizations.
5. Early repayment at no additional cost.
6. Almost one hundred percent approval. Banks have a high failure rate.
7. In case of non-payment, your credit history will not be affected.
8. Can be used instead of a safe deposit box for short-term storage of valuables. Pawnshop services will cost less than renting a safe deposit box at a bank.
9. Pawn shops do not collect debts and do not terrorize borrowers.

Prospects

Due to banks tightening requirements for applicants for loan financing, many citizens have turned their attention to pawnshops and microfinance organizations. Here you can borrow money much easier and faster, although you will have to pay much more.

Pawnbrokers are confident that they will not be left without work in the near future. A reduction in the number of pawnshops is possible, perhaps, in the event of a sharp tightening of regulation by the Central Bank. Or if the credit situation improves so much that consumer loans, credit cards and POS loans will again be issued to everyone. However, given the current state of the domestic economy, such a scenario is unlikely in the coming years.

There are often times in our lives when the need for money arises here and now.

This problem can be solved in completely different ways. If you don’t want to ask friends or relatives for money, there are several more options to choose from.

You can go to a bank and get a loan, become a member of a credit union and use its services, or take money from a microfinance organization. But the most common way out of the situation is to use the services of pawnshops.

We will talk about the advantages and what can be sold to a pawnshop with maximum profit.

A pawnshop is a legal and financial organization that provides short-term loans secured by movable assets and real estate.

The name itself comes from the Italian “Lombardy”, this was the name of the province in Italy, it was its residents who opened the first pawnshops in Europe.

At that time, only jewelry was provided as collateral, but over time, the range of collateral expanded.

The operating scheme of all pawnshops is very simple and understandable to everyone. A person brings an item that he is ready to pledge, and the pawnshop, having assessed the value, issues money. Therefore, before you go for a loan, you should make sure that the item you are renting is worth the money you are expecting.

With great success, the pawnshop accepts new and expensive items, this also includes jewelry, the weight and fineness of which must be established before putting them on bail. After the assessment, loan repayment terms and interest rates are agreed upon.

All items that are handed over to the pawnshop must be in good condition. This is especially true for phones, all household appliances and watches. The list of valuables that meet the requirements of pawnshops is quite large, but basically it looks like this:

Not only the items, but also the borrower himself must meet the requirements of the pawnshop. This must be a person who is 18 years old at the time of the transaction. You must have your passport with you. Otherwise, the pawnshop will refuse to accept the deposit.

To ensure that your trip to the pawnshop is not in vain, you should familiarize yourself with the list of items that cannot be returned. These rules are supported by legislation, so there is no point in trying to rent out the property listed below:

Real estate pledge

This option is relevant if the bank refuses to issue a loan secured by property. There are a number of pros and cons of working with a pawnshop in this case. The advantage is that you can withdraw the money the very next day. There is no need to collect a huge amount of documents, and also, the pawnshop accepts apartments or houses that are still unfinished.

Of the minuses, it is worth emphasizing that the interest on the loan will be much higher than in a bank, and the repayment period will be very short. Similar conditions will await those who decide to mortgage their land plot; in this case, the following documents will be needed:

• certificate of absence of encumbrances on the site;
• Cadastral extract;
• documentation that confirms the identity of people associated with the site;
• copies of government acts on property rights.

The main advantage of each pawnshop will be the speed of registration and issuance of money immediately after the property is assessed. In addition, the client has the right to return his things immediately after he has established his financial affairs.

No bank can boast of such efficiency and the minimum number of documents provided by the borrower.

The entire financial component of the issue lies in the shortcomings. Interest on the loan will be mercilessly high, but not critical, from 0.5 to 1% per day, and the terms for repaying the money are short. But, for paying a certain percentage, the client has the right to extend the contract and retain the right to buy back his valuables.

conclusions

Lately, pawnshops have significantly improved the level of their service. Some of them are already competing with the banking service sector and microfinance companies.

Their activities are closely monitored by government control services, so it has become much more difficult to be deceived, which is another plus for the borrower.

To successfully work with a pawnshop, you should always soberly assess your capabilities and understand the principles of operation of such organizations. Taking into account all these subtleties, any person will solve his temporary financial difficulties with the help of a pawnshop.