pawnbroker

A pawnbroker is a person or business that offers short-term loans in exchange for personal property pledged as collateral. The item serves as security for the loan, and ownership remains with the pawnbroker until the loan is repaid.

To obtain a pawn loan, the item is appraised for value based on type, condition, and market demand. The pawnbroker typically advances a portion of the item's resale value. The borrower receives cash and a pawn ticket, which indicates the loan amount, interest, and repayment deadline. The item is held by the pawnbroker during the term; if the borrower repays the loan and fees, the item is returned. If not, the pawnbroker may sell the item to recover the loan.

Regulation varies by jurisdiction. Most places require licensing and specify limits on interest or fees, recordkeeping, and consumer protections. When goods are not redeemed, they may be auctioned or sold after a grace period. Some regions restrict the sale of certain items (for example firearms) and require safe storage and handling.

Commonly accepted items include jewelry, watches, electronics, tools, and musical instruments; some shops also pawn high-value items or vehicles in regulated contexts. Pawnbroking provides short-term liquidity for people without access to traditional credit, but it can involve higher costs than banks or credit unions and carries inventory and default risk for the lender.