Pawnshop Loans Quiz

Pawnshop loans give consumers short-term cash if they are willing to sell (or pawn) an item to a pawnbroker for possible repurchase by a specific date at a prearranged fixed price. The goods they pledge serve as security or collateral for a loan. If the consumer does not pay off the loan within the agreed upon time period, the goods are lost.

1. Who regulates pawnshops?

2. What is the maximum that a pawnbroker can charge for interest per month?

3. How long must a pawnbroker wait before selling property that was not paid off?

4. If the pawned item is broken or lost while in the possession of the pawnbroker, it is the consumer’s responsibility to replace the cost of the item.

5. It is against the law to pledge or sell property that you do not own at a pawn shop.