Asked in Loans
How does pawning an item work and why is it different than selling one including the amount of value received?
Most pawn shops (it depends on local laws) will allow an individual to borrow money, using an item of value as collateral for the loan. If the loan is not paid back WITH INTEREST in a specified amount of time, the item can be sold or otherwise disposed of in accordance with the terms of the loan. On the other hand, if you sell something to a pawn shop they will sometimes give you a little more money since they don't need to hold the item until the loan expires. Most cities require that pawn shops write down the identification information about anyone who wants to pawn or sell an item in case the police discover that the item was stolen.