Is a pawn loan the best alternative to short term borrowing?

When you need money and quickly, you are faced with a variety of options. Pawn loans and short term loans are two of the most common options people will be faced with when they need money to pay for an unexpected expense or a necessary purchase. Let’s face it, life is full of unexpected things. Not everyone is fortunate enough to be able to have a rainy day fund to tap into when they need a short term source of money for when the unexpected happens. While a pawn loan may not be the best alternative to short term borrowing for everyone, many people do find it has many advantages over other forms of short term loans, including:

Low Risk

Many people don’t like the idea of borrowing money. However, a pawn loan allows them to avoid going into debt by using assets they already have on hand. Often times, the items people pawn are not something they even use. Therefore, a pawn loan is a very low risk loan. You can get the money you need without risking not being able to pay back a loan and ruining your credit. Instead, if you are unable to pay back a pawn loan, the pawn shop simply takes ownership of the item you pawned as collateral.

Instant and Hassle Free

You can spend a lot of time trying to find the right short term borrowing solution for your needs and financial situation. Instead of going through rejection after rejection or sorting through the fine print on short term loan agreements, you can simply look around your home and find something of value to pawn at your local shop. Pawn shop owners are generally very friendly and helpful. You can walk in with a valuable and walk out with the cash you need to make a payment or buy something you need without any hassle. A pawn loan is a quick and easy option that many people find to be an attractive option.

Poor or Bad Credit

If you have poor or bad credit, it may be difficult to get a short term loan. If you are able to get a short term loan, the interest may be extremely high. In this case, a pawn loan will likely be the best alternative to short term borrowing. Everyone’s situation is different, but a pawn loan will allow you to use a valuable item you already own as collateral and provide you with the cash you need instantly.