Month: January 2017

Pawnshop Loans: Are They Good for You?

More and more people may be turning to pawnshop loans for extra cash to fill in the long void between paychecks. A pawnshop loan may be given when a person brings in an item of value that the pawnshop feels it can sell for equal or greater value. The item is collateral for the loan.

The person who receives the loan will usually have 30 days to buy back their item from the pawnshop otherwise it will be put up for sale. If the person doesn’t make it back at the end of 30 days and the item goes up for sale the item will typically be sold for a greater value than the loan.

If the loan recipient comes in after the 30 days and wants to buy back their item they may do so but they will have to pay the mark up. If the item has already been sold it is gone and lost to the former owner.

Before taking out a pawnshop loan on something of value there are a few things you may want to consider.

1} Is the item being taken in for a pawnshop loan a family heirloom or something you treasure?

2} Is the item something you would be devastated to lose?

3} Are you going to be able to pay the loan back at the end of 30 days? Is the loan doable?

If you take a treasured heirloom or something you would hate to lose into a pawnshop as collateral for a pawnshop loan be prepared for the unexpected. Something may happen that causes you to be unable to buy back your item at the end of the 30 days. An unforeseen circumstance such as an accident, an illness, a death in the family and auto repair.

If nothing unexpected happens would you be able to buy back the item you pawned? Are you allowing for the fluctuations in monthly bills like electricity, gas and water? If not bills may become an unexpected if they have risen in price. Factoring in when you get paid can hurt the timeline, the 30 days, for pulling in enough money to buy your item out of pawn. Remember that after the 30 days the item will go up for sale and you will either lose it forever or the price will increase for you to be able to buy it back.

An item taken to a pawnshop doesn’t have to be for a pawnshop loan. It may be something of value that you don’t want and want to sell. Be sure and let the pawnshop people know whether you want to sell the item or you want a pawnshop loan. It may make a difference in the amount of money you receive. You may receive more money for the item if you sell it outright. A pawnshop won’t give you a pawnshop loan or buy outright everything you feel may be of value.

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Loans: What to Do When Friends and Relatives Do Not Pay Back

One consequence of the current economic crisis is that credit is increasingly difficult to obtain bank loans. That and the fact that bank loans can be expensive, we will probably see an increase in informal loan offered to friends and family. Generally, it is still considered an option of last resort, because of its potential for a relationship of strain values.

It is particularly associated with danger, since it is common for people who ask to borrow money are likely to do so because they had financial difficulties and perhaps because they have transformed into a loan from a bank.

What do we do if we have lent money without the other person fails to pay the money? One of the problems from person to person lending is that it is almost always informal in nature, without written contract, and often no agreement on the repayment schedule. This means that the lender really does not justice (or would be very difficult to assert any legal rights) should be the other person does not repay the money. You are therefore relying on the trust that exists in your relationship, but as good as the confidence in May, in May, there were mitigating circumstances which means that the other person can not pay the money.

When the lender, you have several options should you find yourself in this situation undesirable. The first is simply to recoup the money and put it as a painful experience. You can take this option if the amount is relatively low (at least from your point of view) and / or you do not want the issue to fall into a bad argument that can destroy a relationship that you enjoy. For example, if you loaned money to your younger brothers and sisters. You must clearly state that you are not satisfied with the result and that will be more money. It is hoped that the other person might be ashamed of the effort to repay the money even if you said that you’re ready to write.

A second option is to talk to your friend about why it is difficult to make repayments and offers flexibility in payment shall be made or the amount that you are awaiting the first installment. Open and honest communication is the key here, and it is important to try to stay calm. Rising tensions and accusations do tend to make things worse. To understand the perspective of the other person can help make it possible for you to come to an agreement that will reduce the financial loss to you. That is essentially what the banks when the borrower is in difficulty in a loan.

The third option is to invest in an aggressive and demand that the other person pays all the culprits and do so within a specified period. If you use this method depends on how you know the other person and to what extent you think that this approach is likely to be. You must keep in mind that May affect your friendship, but it is hoped that some short-term friction May be better than leaving the festivities to a lot of more putrid.

In general, personal loans is a risky and often provide a great deal of inconvenience and suffering for very little reward. That is why we chose to take loans from banks. This does not mean that sometimes there are circumstances where you will find in May, it is lending money. But like a bank must be diligent when offering a loan, you must have thought long and hard about the benefits of lending by your friend or family member for money.

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