WHAT IS A PAWN?
A pawn is a loan backed by physical collateral. If people need money quickly they can bring in an item, such as a firearm or article of jewelry, to a pawnshop to get a CASH LOAN for it. The pawnbroker will give cash money for the item and hold it for 3 months to give the customer an opportunity to get the item back.
In Michigan the rate charged for a pawn is 3% of the loan amount plus $1 dollar per month (minimum charge of $1.50 per month). For instance, if a customer brought in a gold ring and received $100, the finance charge for the pawned ring would be $4 per month. If the customer returned within one month to redeem the pawned item, the cost would be $104. If the customer waited until the 3rd month to redeem the item, the cost would be $112. These rates apply as long as the customer is not late. If someone pawned an item on Jan 15th, the due date would be March 15th. This a much CHEAPER alternative to payday loans with a lot more time to pay the money back!
Gladwin Trade & Sales also allows the customer to pay up the charges for the loan to BUY MORE TIME, so to speak. If the customer needs more time and the charge on the loan is $12, such as the example above, the customer can pay the 3 months worth of charges (in this case $12) on or before the due date and get an additional 3 months time on the pawned item. The same charges would apply for the additional 3 month loan (in this case $4 per month). This called renewing the pawn and can be done as many times as the customer needs.
Any questions? Give us a call 989-426-6811