Despite a large number of quick cash options these days, pawnbrokers have never lost their relevance. They’re just like other secured loans, yet attract certain types of borrowers.
Is jewelry loan for you? It is if you’re one of these people.
People Who Have a Bad Credit Score
Catering to the needs of subprime borrowers isn’t unique to pawnbrokers, but they’re the choice of individuals with an unimpressive credit history. As opposed to other untraditional lenders, pawnbrokers run no credit check. When done to avoid fraud, it wouldn’t be extensive.
Providers of diamond loans care little about your credit score; instead, they judge your creditworthiness by the security you have—your diamond piece of jewelry. The amount you could borrow depends on the value of your item, which would be appraised before you.
Pawnbrokers are not afraid of default, as they can get your jewelry resold without incurring any loss.
People Who Need a Longer Term
Unlike payday loans, which have to be repaid normally in just two weeks, you would have months to repay your jewelry loan. In case you were unable to pay, you wouldn’t risk losing your cash—money you can use to buy food, pay for electricity, and prevent getting evicted.
Yes, your piece of jewelry may have sentimental value to you, but it’s less risky to use as collateral than your paycheck. Besides, many pawnbrokers tend to be more lenient when it comes to giving grace periods.
People Who Fear Hurting Their Credit
Missed payments on jewelry loans generally wouldn’t impact your credit. Your delinquencies wouldn’t be reported to the major credit bureaus, so your score wouldn’t drop no matter what.
Plus, since there wouldn’t be any hard credit inquiry involved, applying for a diamond loan wouldn't affect your credit rating whatsoever.
Jewelry loans are a godsend to most Americans. As long as you use them right, you’d get the cash you need and recover your treasured memento at the end of the day.