Are you looking for some extra cash and too embarrassed to ask for help from family? You have considered a short-term loan from a bank however, it could take days if not weeks to finalise, and for the small amount you need over a short period of time, it would just not be viable through a traditional loan.
If you are in the fortunate position of owning a vehicle that you don't drive regularly, pawning your car for cash might just be the light at the end of the tunnel that you are looking for.
What does pawning my car for cash involve?
Although it works a little different from a traditional loan, simply put, pawning your vehicle for cash is a way to secure a loan using your car. It is considered one of the easiest ways to secure a loan and you can usually get around 50% of the vehicle value. The car that you pawn for cash does need to be fully paid up before you can even consider this option.
Do I qualify to pawn my car for cash?
The following requirements are applicable should you wish to pawn your car for cash:
- You will need to be a South African citizen with a valid identity document
- The vehicle needs to be fully paid up
- You will need all the necessary details of the vehicle such as make, model, mileage etc.
- A service history document of the vehicle you will be pawning if available.
- You will need the official papers of the vehicles
- You will need to agree to all the terms and conditions set out by the pawnbroker.
How does it all work?
Usually, pawnbrokers or pawn shops offer loans against high-value items such as jewellery, electronics, power tools etc using the item as collateral against the loan. A time period to repay the loan with the respective interest is then agreed to between the pawnbroker and the customer. Once the loan has been settled the customer is free to pick up the items again. Any defaulting in the loan requirements gives the pawnbroker the legal right to sell the item.
Car pawning follows a similar process. The only difference is that the item you are pawning is a lot bigger and worth a lot more, but the process of pawning your car for cash still remains as simple as pawning a watch.
Why should I pawn my car?
Life is known for throwing a few curve balls along the way and when you're in a tight spot financially, pawning your car for cash could be the ideal solution.
When we are forced into a tight financial corner, selling an asset immediately comes to mind. The problem is you can become desperate and The benefit of this is that the car is still yours, it is simply just stored at another location. And, once the loan has been paid in full you are free to claim back your vehicle and drive it home again.
What will happen to my car when it gets pawned?
In most cases, a car is a person's prized person and the reason they have chosen to pawn their car for cash is that they are needing cash for an emergency, it is normally their last resort to obtaining cash. It is therefore understandable to be apprehensive about where your car will go until you have settled the loan.
Once you and the pawn shop have agreed on all the details of the loan, the pawnbroker will arrange secure transportation of the vehicle to the storage facility. You are also given the opportunity to drive the vehicle to the facility yourself. The vehicle will then be stored in this safe and secure facility. These facilities have 24-hour security so you can rest assured knowing your vehicle will be kept completely safe during its time with the pawn shop.
Once the loan is repaid in full, the pawn broker will return your car back to you via safe transportation to the location of your choice in exactly the same condition as when you left it with them.
How do I apply?
Applying to pawn your car for cash is a relatively easy process. These days most pawn brokers offer online applications to get the process started after which you will need to go into the store for the assessment.
During the assessment of your vehicle to be evaluated, the pawnbroker will then inspect your vehicle and offer you a loan based on this inspection. You then agree to this amount and the respective terms of the agreement by signing the contract. After all the documentation has been signed you'll get your cash within a few hours.
It's one of the quickest ways to release money from your car without having to sell it.