Frequently Asked Questions

How do pawnbrokers operate?

Pawnbrokers lend money against the security of items left by the borrower. Items vary from gold & platinum jewellery, quality watches and diamonds to power tools, generators, home electronics, musical equipment, computers, motorcycles and even cars. Collateral value is determined on the current market price of the items brought in, and it’s re-sale value if the loan is forfeited. The pawnbroker will hold the item for a defined amount of time stated on the pawn ticket and charge interest on the amount loaned. The duration of the loan varies from 30 to 90 days and can be renewed indefinitely.

Why go to a pawnbroker for a loan?

Pawnbrokers provide short terms loans instantly, conveniently, and confidentially. You can leave with the money in your hand in five minutes or less. There is no massive amount of paperwork.

Who are pawnshop customers?

Pawnshop customers are working people like you and me. They borrow money to meet their daily needs until the next payday. Short-term loans are sometimes needed because of an unexpected medical bill, unforeseen car repairs, rent or grocery till payday.

What happens if I don’t redeem my collateral?

Pawnshops are required by law to hold an item for a defined period of time, usually stated on the pawn ticket as the due date. If the goods are not redeemed before the due date, the item pledged become the property of the pawnshop. The pawnshop can then dispose of the item through their retail outlet to recover the amount loaned.

Do people bring in stolen items to pawnshop?

Regulation requires that a valid government issued photo identification be presented before a transaction can take place. After a positive identification is made, the process of a loan can then be initiated. At the end of the day the transaction information is transmitted to the local police. Since the police will have all personal information of the customer and full description of the item pledged, thieves and robbers will unlikely bring stolen items to the pawnshop. They can easily be traced.
In the event the police have sufficient evidence that a pawned item is stolen, they will confiscate it. If the item is indeed stolen, the pawnshop will lose the money loaned. Clearly it’s not in the pawnshop best interest to take stolen items. Typically at Common Exchange 1 in 1500 items pawned turns out to be a stolen property.

Do most pawn customers lose their items to pawnshops?

Pawnshop depends on repeat customers. Statistics shows that an average of 96% of customers redeem their collateral. Almost half of the 4% of items that are left behind, pawn customers had no intention to pick them up in the first place.

Are pawnshop rates high?

Interest rates charged by pawnshops are regulated. Interest charged reflects implicit cost such as appraisal, handling, storage, insurance, and overhead cost. Unlike other lending institutions, there are no hidden charges. If the item is redeemed on or before the maturity date, the customer is liable for the principal and interest to date. For our longtime customers, Common Exchange out of goodwill, we will hold an item past their due date for a minimal fee. The items that are left behind are disposed of through a retail outlet to recover the cost.

Are pawnbrokers regulated?

At the municipal level, pawnbrokers are licensed and regulated. They must abide to regulations and by-laws.

Do pawnshops help the community?

Pawnshop has a vested interest in local community. Common Exchange Ltd has been consistently involved in the community they operate. Our motto is: “we must support the community where our customers live, because they support us”.