If you’re looking at this webpage, you’re looking at it for a reason. Obviously you have an asset on your hands that you’re looking to make some money from and don’t exactly know the best way to go about doing it. That’s okay! We’re here to help you figure out car pawns. Selling an asset of value like a car or a motorcycle can be a daunting task, and the pressure to do it the right way is often overwhelming. If you’re wondering whether it will be easier for you to pawn your car or sell your car, you’ve got to ask yourself five important questions.
Do I need cash now? Pawning a car is a great way to get you out of that pickle you find yourself in. Your pawnbroker will give you an accurate valuation of your vehicle and give you the cash accordingly which can be used for whatever your more urgent matter is. Selling your car can make piles of paperwork with twenty different places for your signature. When you need cash now, selling your car can actually hinder more than help. Pawning gets you cash fast without the lengthy paperwork.
Do I want my car back? This is a big one: if you are looking for some cash in an emergency, but still want to have the vehicle when you’ve paid back your car pawn loan, pawning your car is the better option for you. If you’re selling your car, you are forfeiting the right to own that car ever again! When pawning your car, you have the right with the pawnbroker to buy back your car after you’ve paid your loan and the interest agreed upon. However, be careful of pawn brokers or shops that tout that you can ‘pawn your car and still drive it’: this is a scam – check out our article on it here.
Am I worried about my credit record? Credit scores go up and down and we aren’t here to judge you for it. Pawnbrokers don’t record their loans with the credit bureau and consequently your record won’t be affected if you are unable to pay the loan or your vehicle is sold by the broker. Similarly, if you are blacklisted by banks or financial institutions based on your bad credit record, pawnbrokers will overlook this fact. Their philosophy is simple: if you cannot pay back your loan, they will sell the vehicle for money: no negative rating to your credit whatsoever.
Do I want to deal with financial institutions? Banks, credit providers, financial institutions and lending agencies can be pretty intimidating. Like we mentioned earlier, they value your credit record and will go through lots of paperwork just to get you the value for your vehicle. That’s a lot of time and energy going towards an institution that will take a large chunk of whatever you might make in selling. Pawnbrokers are usually more down-to-earth members of the community who have very low rates of interests on their loans in order to compete with the bigger institutions.
Do I want to take on the vehicle’s risk? When you pawn your car, the pawnbroker takes a significant amount of risk in taking your vehicle. They are usually going to make less than the value of your vehicle if they are forced to sell it, and if you are not able to pay off the loan, they essentially lose money. While valuable, vehicles can be risky assets, and if you are hesitant about shouldering the value of the vehicle, pawning it is an excellent alternative.
Hopefully this handy questionnaire has helped you answer your question ‘should I pawn my car’. There are lots of pros and cons to whether you should do it, but your answers to these questions should make the process a little simpler.