Pawnbroking loans
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A pawnbroking loan, also known simply as a pawn loan, is a type of short-term, secured loan that is obtained by using personal belongings or valuable items as collateral. Individuals can bring items of value, such as jewelry (Gold & Diamonds), watches, and fine wine, to a pawn shop or pawnbroker’s establishment. Goldman Scraps will assess the value of the item and offer the borrower a loan amount based on a percentage of that value.
Here's how a pawnbroking loan typically works:
- Collateral: The borrower brings an item of value to our pawn shop. Goldman Scraps will evaluate the item to determine its worth. The loan amount offered is up to 70% of the value of the item.
- Loan Agreement: If the borrower agrees to the loan terms, they receive a pawn ticket or receipt that outlines the loan amount, interest rate, repayment terms, and other relevant details. The borrower retains a copy of the ticket.
- Loan Period and Interest: Pawnbroking loans have a relatively short loan period, 6 months. During this time, the borrower is expected to repay the loan amount plus interest. For example, a loan of £200, the monthly cost will be £45.
- Loan Repayment: The borrower has the option to repay the loan within the agreed-upon timeframe, typically by returning to the pawn shop and paying off the loan amount plus accrued interest. Once the loan is repaid, the borrower receives their pledged item back.
Here's how a pawnbroking loan typically works:
Representative Example:
Total amount of credit £200.00 for 6 months
Total amount payable £270.00
Total charge for credit £70.00
Interest rate 70% pa (fixed) equivalent to 5.83% per month
Representative APR %
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Calculator Information
The Equipment Finance Calculator calculates the type of repayment required, at the frequency requested, in respect of the loan parameters entered, namely amount, term and interest rate. The Product selected determines the default interest rate for personal loan product. The Equipment Finance Calculator also calculates the time saved to pay off the loan and the amount of interest saved based on an additional input from the customer. This is if repayments are increased by the entered amount of extra contribution per repayment period. This feature is only enabled for the products that support an extra repayment. The calculations are done at the repayment frequency entered, in respect of the original loan parameters entered, namely amount, annual interest rate and term in years.Calculator Assumptions
Length of Month
All months are assumed to be of equal length. In reality, many loans accrue on a daily basis leading to a varying number of days interest dependent on the number of days in the particular month.Number of Weeks or Fortnights in a Year
One year is assumed to contain exactly 52 weeks or 26 fortnights. This implicitly assumes that a year has 364 days rather than the actual 365 or 366.Rounding of Amount of Each Repayment
In practice, repayments are rounded to at least the nearer cent. However the calculator uses the unrounded repayment to derive the amount of interest payable at points along the graph and in total over the full term of the loan. This assumption allows for a smooth graph and equal repayment amounts. Note that the final repayment after the increase in repayment amount.Rounding of Time Saved
The time saved is presented as a number of years and months, fortnights or weeks, based on the repayment frequency selected. It assumes the potential partial last repayment when calculating the savings.Amount of Interest Saved
This amount can only be approximated from the amount of time saved and based on the original loan details.Calculator Disclaimer
The results from this calculator should be used as an indication only. Results do not represent either quotes or pre-qualifications for the product. Individual institutions apply different formulas. Information such as interest rates quoted and default figures used in the assumptions are subject to change.
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Calculator Disclaimer
The repayment amount shown using this calculator is an estimate, based on information you have provided. It is provided for illustrative purposes only and actual repayment amounts may vary. To find out actual repayment amounts, contact us. This calculation does not constitute a quote, loan approval, agreement or advice by My Finance. It does not take into account your personal or financial circumstances.