Pawn Loans & Pawn Industry Facts

Interest rates are regulated by the state of Kansas. Kansas offers one of the nation’s lowest interest rates, with monthly rates up to 10 percent.

Pawn shops lend money on items of value (value is based on what the shop can resell the item for if they should own it later) ranging from gold and diamond jewelry to televisions, tools, and guns, etc. These items maintain their value over a period of time. Loans are usually small, but can range from $10 up to a thousand or more depending on the value of the collateral item, and the need of the customer.

  • Pawn businesses are heavily regulated and licensed by state and local governments.
  • Pawn loans are usualy small, short-term loans as evidenced by the low national average loan amount of $80 and have no negative credit effect.
  • Pawn businesses are governed by all of the 12 major federal laws & regulations that apply to other entities designated as financial institutions.
  • Pawn stores lend to anyone and use collateral to secure a loan, and never pull a credit report.
  • Pawn transactions are routinely transmitted to local law enforcement, which dramatically decreases the likelihood that a thief would bring stolen merchandise to a pawn store.
  • With a pawn loan, there is never an obligation on the part of the borrower to repay the loan, nor is there ever an adverse impact to one’s credit rating in the event of a default.
  • Less than one-half of one percent of pawned items are reported as stolen.