Rolex watches – how a pawnbroker works

If you are considering taking your Rolex watch to a pawnbroker in order to obtain a secured loan, here’s a brief guide to how the system works.

Loans as from a bank

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Like a bank, a pawnbroker earns income on the interest that is charged on the loan secured by an item such as a piece of jewellery from good retailers like http://www.thejewellerychannel.tv/, a painting, inexpensive branded Ice Watches and high value Rolex watches. The customer and the pawnbroker agree the sum to be advanced, and the pawnbroker presents the customer with a document written under the Consumer Credit Act 1974 containing the terms and conditions of the loan. The customer also receives a pawn-receipt for presentation when redeeming the goods. If this receipt is later lost, the customer should inform the pawnbroker immediately, incase anyone unlawfully tries to redeem the goods.

Period of the loan

The agreement is usually for a period of six months and the customer is entitled to redeem property by payment of the original loan plus the monthly interest due at any time during the contract period. When the loan and the interest are paid, the goods are returned to the customer.  Longer loan periods are negotiable, so for example you may request a longer period for a loan against a Rolex watch than you might against a sterling silver bracelet, or you can take the standard six months, then pay off the interest and begin a new agreement.  At the end of the period of the agreement, the pawnbroker will give the customer 14 days notice to redeem the goods before he is entitled to sell them to recover the sum originally loaned.

Market value

If the goods aren’t redeemed and the agreement isn’t renewed, the pawnbroker can sell the goods based on a true market value.  The reason for this is that you may have missed the interest payments on your Rolex watch but if it is sold you will be entitled to the proceeds, minus the sum of the original loan and interest payments due to the pawnbroker.

Give a dog a bad name

Contrary to popular belief, the pawnbroker doesn’t want to acquire your goods – he is in the business of lending money, not retailing a wide variety of goods.  He would much rather return your Rolex watch to you in exchange for the loan and interest than have to take time consuming steps to sell it.  Also much of a pawnbroker’s business is repeat transactions – often with the self-same item used as security.  Individuals requiring immediate cashflow solutions may find the easy accessibility of the pawnbroker more user-friendly than any bank or building society, where there is form-filling and waiting on decisions as to whether you will be granted a loan.