Pawning gold?
logger7
Posts: 8,658 ✭✭✭✭✭
A customer was at a shop on Friday trying to get a valuation on a cleaned $20 Liberty and a US eagle ounce coin. The cash offers were $2600 and $2800 respectively. Then he asked about pawning it, and the shop said they have too much inventory and were not interested in a pawn deal. How would that work and would pawning gold now make any sense?
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pawning is a short term loan, the gold being collatoral.
Repetition of ignorance is ignorance raised to the power two.
If pawned, the pawn shop makes money but it takes more time to make that money, and the pawn shop's money is tied up for longer. I assume they would rather just buy the gold and flip it within a day or so for a quick profit.
if he has too much inventory, he's not flipping it in a day or two.
for a pawn shop thread i expected an attempted rip story. not a bad offer on the age
Actually was at a pawn shop earlier. They had a 1914 $5 Indian that was polished and cleaned in their cases for months. There was a price behind it of $690 today. I would not have been interested in buying it but they jacked the price up to $750 or more. They buy 90% of melt they said.
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We don't know if that is really the case (that they have "too much inventory"). I suspect the real reason that the pawn shop doesn't want to make a loan is because they don't really want to tie up $5,400 for a month or more. If they buy at $5,400, they could immediately sell it to a gold dealer or coin shop for a $150 profit, regardless of what the pawn shop's inventory was.
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Those are strong buy offers from a pawnshop. A cleaned $20 Lib melted around $2750 last Friday and the GAE $2850. That's 95% & 98% of melt. Pawn shop offers in my area would not be close to that. You'd be lucky to get 90% of melt after haggling.
Actually the dealer was a coin shop's offers. He offered buy prices, the guy did not want to sell but asked about pawn options and he was not interested. So the inquiry here was about coin shops offering to do pawn offers but they probably can't without a license. What the going interest rate on pawn shop loans?
What the going interest rate on pawn shop loans?
20-25%
I get questioned about this all the time,. I do not have a pawn license , so i cant legally take pawn, nor would I want too, hold times are too long for one, and secondly ties up too much money for longer period. Most of the pawns, the pawn guys offer considerably lower if a pawn vs a direct sale. They do that in hopes they borrower dosn't come back and pick it up, and if they do, theve made a ton of intrest on it. I would never recommnend any body pawning common date $20 or gold eagles and such, the intrest fee alone would be stupid, just sell it, and rebuy one later if you have too.
I once had a guy come into shop with a $500 FRN note, he wanted to pawn it, so i told him Id just buy it for 900(couldnt do pawns), he said no, so went to a buddy's pawn shop i know and borrowed 500 cash against the note, and never came back to pick it up. i ened up buying the note from the pawn broker freind at 750.00
the frn sounds stolen