Pawning something valuable usually means using it as collateral while borrowing some quick cash. When you pawn a car at a pawn shop, they immediately pay you with cash in exchange. There is an understanding that you can buy your car back later on. The benefit of pawning something is getting cash in hand immediately. The downside, however, is that you'll have to pay extra money (the amount you borrowed as well as interest) to get your car back. If you are not able to buy it back, the shop may decide to sell it to someone else. We have curated a list of dos and don'ts if you wish to pawn your car for cash on the same day.

Pawning Your Car: A List of Dos

Be familiar with the pawn-a-car procedure. Your car needs to be turned over as collateral in order for the equity to be released. The car is given back to you after the capital has been paid back in accordance with the conditions of the agreement. This kind of loan arrangement is inappropriate for you if you can't afford to travel without your car.

Make sure you have supporting documents for your application.

Pawn shops for cars only accept applications backed by important documentation. Naturally, we need the original registration documents for the car, a copy of your ID, and proof of your address. Some pawn shops might need you to show documents to prove that you earn enough to pay the monthly EMIs.

Make sure your lender is reliable.

The UK has witnessed a significant increase in the number of microlenders and auto-pawn businesses in recent years. Quite a few of these "loan providers" have dubious offers with exorbitant interest rates and hidden costs. Get in touch with a recognised business to prevent falling prey to scams. This way, you can be sure about interest rates that comply with the FCA and clear loan agreements.

Read the fine print carefully.

It is in the fine print that the most critical costs are hidden. It is important to examine and understand the terms of the agreement before signing it. If you're not sure about a particular point, look for clarification. The agreement should incorporate things like interest rates, startup and admin expenses, early settlement policies, credit extensions, and more.

A Few Don'ts of Pawning Your Car

Make sure your car is in its best condition.

The make, model, mileage, and condition of your car will impact how much you earn by pawning it. A well-kept, polished car with an excellent service history will fetch you a higher price at the pawnshop rather than one that is not in good condition.

Avoid pawn-and-drive operations.

Pawn-and-drive programmes are risky, even though they could seem like the perfect answer. In this agreement, the lender requires the transfer of ownership of the car. Some shops demand a monthly rental fee in exchange for letting you drive your own vehicle from time to time. Apart from the high interest rates, monthly rent, and loan commencement fees, there are other additional expenses too.

Don't expect to get the car's entire resale value.

It is not very often that auto pawn shops give short-term loans for the entire market value of an automobile. On the used market, you can, at most, expect to receive a portion of the car's estimated value. Initially, an offer is made over a phone call. A second, formal loan offer is provided orally after the car has been evaluated at the location. You have the option to accept or reject that offer on the spot.

Bournemouth Pawn Can Help You Loan Your Car for Cash in Dorset

Emergencies can occur anytime, and it is important to keep these options of obtaining some quick cash at hand. Bournemouth Pawn helps you obtain a loan conveniently, with no unnecessary delay or tedious paperwork. Call us at 01202 097004 for additional information, or just fill out and submit our online application.