San Francisco, CA (PRWEB) January 29, 2015
Best Collateral pawn shop in San Francisco recently published answers to questions posed by consumers interested in visiting a pawn shop for the first time. San Francisco pawn shops, like Best Collateral, provide pawn loans to consumers everyday who find themselves in need of a little extra cash. Pawn shops are a vital alternative to conventional bank loans and have helped many families in San Francisco and the Bay Area in difficult economic times.
Unlike loans from banks or other lenders, a pawn loan can never affect a consumer’s credit. No employment verification is required, and the process of obtaining a loan is fast and easy. Yet, many remain unclear as to how pawn shops work and why they are a viable option for meeting financial needs. On their website http://www.bestcollateral.com/stores/San-Francisco/, Best Collateral has several video’s that provide more details on how a pawn loan can help consumers in need of short-term cash.
For consumers looking to visit a San Francisco pawn shop, here are brief answers from Best Collateral on how pawn shops work and how to get a pawn loan:
How do pawn shops work?
People often need to borrow small amounts of money that other lenders are not willing to provide. As with many other loan products, a pawn loan is based on the collateral provided to support the loan. Best Collateral lends money on items of value ranging from gold and diamond jewelry to musical instruments, televisions, tools, household items, video games and more. For loans below $ 2,500, interest and fees are fully regulated by the State of California. For loans of $ 2,500 or more, fees are regulated but interest is negotiated between the borrower and the pawn shop.
The statutory loan period in California is 4 months, with the borrower having the flexibility to renew or redeem the loan at any time. During this loan period, ownership to the property stays with the borrower – the pawn shop merely stores the property until the loan is repaid or the customer decides to not repay the loan. At the end of the loan period, California statutes require a “10-day” grace period “Default Notice” be mailed to the borrower. To enhance a borrowers’ ability to manage their loans in a timely manner, Best Collateral offers a free email reminder service and provides its customers with a 15 day grace period. Best Collateral also provides a 10-day grace period between the sending of the email and the mailing of the official notice. This affords Best Collateral borrowers a loan period of 4 months and 25 days, whereas California statutes amount to a 4 month and 10 day loan period.
If a customer prefers to sell their property or trade it for an item for sale in a pawn shop, Best Collateral pawn shop in San Francisco can outright purchase the item; thereby saving the consumer the hassle and risk of trying to sell the item themselves. The goal of Best Collateral is to be competitive with the “net” value a consumer would get by selling the item on an internet sales sites or reducing the risk of meeting unknown buyers.
How much money can I borrow from a pawn shop?
Pawn loans can be as small as $ 10 or as high as several thousand dollars, depending on the need of the borrower and the value of the collateral. Customers tend to only borrow what they need. The average loan is between $ 70 and $ 150.
How does a pawnbroker determine how much my item is worth?
Best Collateral staff begin the process with understanding how much a borrower needs in order to solve their short-term cash requirements. Our professional staff then assess the value of the collateral—its current appraised value based on its current condition and our ability to resell the item should the borrower not retain ownership at the end of the loan period. We use all the research tools we have at our disposal to determine an item’s value and do our utmost to meet the customers’ cash needs. Just like when someone takes out a loan on a house or a car, if the collateral provided supports the cash needed, we offer to lend the amount desired by the customer. If the collateral is not sufficient to support the amount needed, Best Collateral staff offer suggestions on how the customer may provide additional collateral to support the loan or ask if a lower valued loan will still meet their needs. In the end, it is the goal of Best Collateral staff to find a way to say “yes” to making a loan and satisfy each customer’s needs.
How much interest will I have to pay at a pawn shop in San Francisco?
Pawn loan interest rates are regulated by the State of California and are calculated on a sliding scale based on the loan amount. Usually, the more you borrow, the lower the interested rate. On average, the interest paid on a pawn loan often amounts to less than bank overdraft fees, bounced check fees or utility bill late fees. As an example (based on rates applicable in January 2015), a 4 month, 25 day loan of $ 150.00 with Best Collateral will cost just over $ 5.00 a month. A 4 month, 25 day loan of $ 300.00 will cost just over $ 8.00 a month.
What happens if I can’t pay back the money from my pawn loan?
It is important to understand that for the payment of the interest and fees, a borrower may enter into a new loan contract and have an additional 4 months and 10 days (4 months and 25 day with Best Collateral) to gather the funds to pay the loan in full. This option is available to the borrower for as many loan periods as they need to pay the loan in full. If for any reason the borrower decides they are unable to repay the loan in full, their credit can never be affected. That’s because the item has been used as collateral to secure the loan and the pawn shop may only look to the value of the collateral to recoup the money they loaned. Only after the 4 month and 10 day loan period (4 month and 25 days for Best Collateral) has expired does the collateral becomes the property of the pawn shop and can be sold. Upon expiration of the full loan period, the borrower has no further obligation to the pawnbroker.
For more information about how pawn shops work, contact Best Collateral. Best Collateral has 8 locations in Northern California, with 2 pawn shops located in the heart of San Francisco.
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