Top Five Pawnbroking Myths Busted With Loan Purchase

Over the years pawnbroking has been surrounded by myth, with many people having misgivings about the actual service high street pawnbrokers offer.  Now in light of the recent introduction of online pawnbrokers, Loan Purchase, the Dorset based firm making credit accessible is helping to break down these barriers and encouraging others to visit their local store.

1. Pawnbrokers are unregulated
Pawnbroking is a heavily regulated business contrary to many misconceptions and like all businesses certain rules have to be followed.  If you pay a visit to any pawn brokers, you can ask them who they are regulated by and they should be able to tell you if they are a reputable firm.

2. If you visit a pawn shop they will try to keep your items
Despite popular belief, pawnbrokers are lending institutions and the more money they lend to their customers, the more profit they will make.  Pawnbrokers make their money from the loan fees and the majority of pawnbrokers will make sure that you are able to keep up with these fees and use their services again.

3. Most pawn customers lose their items as they can not keep up with the repayments.  
Figures demonstrate that around 80 per-cent of all pawnbroking loans are repaid successfully.   Repeat business is important to pawn brokers and many firms will know their customers very well as the levels of repeat business are high.   As with all loans, there will always be those who can not afford to pay the loan back, but the fees are very reasonable these days and many find it very easy to keep up with repayments.

4. Pawnbroking is considered to be business that thrives in ‘bad economic’ times.
Pawnbrokers do well in both good and bad economic times and this is all down to how well they adapt to financial changes at the shop floor level.  In good financial times, customers have a greater ability to repay their loans and items that are left at the store can be re sold much faster due to the higher levels of disposable income.