The Pawn Shop USA is a type of store that lends money to customers secured by personal property. The store keeps the merchandise until the customer pays back the loan plus interest and fees. Many pawn shops also sell items outright and a few specialize in certain merchandise, such as firearms. These stores are licensed and regulated by state and federal law. The pawning industry helps millions of people meet their short-term credit needs and provides a desired non-recourse lending option.

The 10,600 pawn shops in the US offer loans and sell used merchandise, which generates $42 billion in annual revenue. They are primarily local businesses and comply with a number of state and federal regulations, which vary by jurisdiction.

Pawn Shop USA: Where to Find the Best Deals

When a customer brings an item into a pawnshop, the pawnbroker performs a quick over-the-counter evaluation of the merchandise to determine its value. The pawnbroker may offer to purchase the item outright or he/she may decide to give the customer a pawn loan.

In most cases, a pawnshop will only loan money if the pawnbroker believes the item will have a high probability of being sold shortly. The amount of the loan and the term of the loan are based on the item’s value and its condition. Most pawn shops will not report loan defaults to the credit bureaus.

The vast majority of pawnshops’ loans are repaid and the resale of pawning merchandise provides much of the industry’s revenue. As with any retail business, a pawnshop’s profitability depends on the ability to acquire and sell merchandise at an attractive price.