Financial crisis has encapsulated the whole market. The people are neck deep in debt. They opt for debt settlement services to come out of the labyrinth of debt. They pawn their gold ornament in order to meet the demands of the creditors. The economic downturn is solely responsible for the business of the pawn brokers to flourish.

What is meant by the term pawn broker?

Conventionally the pawn brokers are those people who give loans to the borrowers against any security deposit of land property or valuable possession like gold. The borrower can retrieve all the security deposit once the loan is repaid. But there are many pawn brokers who are taking the advantage of the high price of gold and is selling off the customer’s valued possession.

The borrower gets aware of selling off their possession from the on-line auctions. They know that if they sell their valuable things then they would be able to raise money. In this way they would be able to pay off the loans without incurring further debt.

The pawn broker gives money against a security deposit and on the repayment of the loan the borrower can discharge the possession from the lender. The item which is kept as a security deposit is evaluated and then an interest rate is fixed accordingly. Most pawn brokers charge 3 to 5 % Annual Percentage Rate (APR) per month. The people are keen to take up loans from the pawn broker as the interest rate is comparatively lower than that of payday loans.

The tenure of borrowing can be extended but if one fails to do this, his valued possession would be sold off. The pawn broker doesn’t get much benefit out of it. His main intention is to roll the money and get the interest amount.

If the security deposit is sold off then the customer doesn’t lose much as the pawn broker takes only the amount which was loaned out with additional interest charge. And the surplus money is returned to the customer.

Basically the pawn brokers are from the buy back shops

Pawnbrokers are distinct from high street buy-back shops such as Cash Converters, where a customer will sell an item with the option to buy it back 28 days later. If the customer doesn’t repurchase the item, it goes into the shop to be sold (items are not usually limited to gold and jewelery; they can be electrical goods as well, for example).

Pawnbrokers are regulated alongside banks and other lenders by the Consumer Credit Act 1974. Borrowing through a pawnbroker may not be suitable for everyone and high interest rates mean it is not a long-term solution, as they themselves acknowledge, but sometimes it can resolve short-term cash flow problems.

FURTHER INFORMATION

Under the Consumer Credit Act, the pawnbroker must give the customer a receipt detailing the date on which the redemption period ends, the amount of credit secured by the pledge, and the interest rate, as well as information about other charges individual lenders may apply.

In case, you have taken a loan from a pawn broker, try not to lose your pledge receipt. If you do so, inform your pawnbroker immediately so that nobody else can present it.

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Are there really only nine personal finance tips you can’t live without? Can you really not live without them? It’s debatable, of course, but here they are, in classic David Letterman style (minus one):

1. Make Love to Your Budget – Budget early, budget often. Take your budget to dinner and buy it a drink. Whisper sweet nothings in your budget’s ear. Just don’t let the missus find out about you two…or you can make it a threesome, if she’s cool with that.

  • Freedom Account Spreadsheet – MoneySpot.Org’s spreadsheet version of the classic Mary Hunt “Freedom Account” budgeting system. Simple, elegant, and easy to use…not to mention dead sexy.

2. Be a Debt Assassin – Stalk your debt (preferably while wearing ninja garb). Learn your debt’s daily routines, which way it goes to work, where it eats for lunch. The plot its assassination. The best technique is to roll a snowball at it, which in cartoon fashion will hit your debt, embedding it in the side of the snowball, and then roll on to crush your next debt.

  • Debt Snowball Spreadsheet – It’s Your Money’s debt snowball spreadsheet will help you plan your debt repayment so that your debt is dead as soon as possible. Ninja garb not required while using the Debt Snowball Spreadsheet, but it sure does look cool to actually wear a ninja outfit…as much as possible…regardless of what you’re doing.

3. Live, Eat, and Breathe Personal Finance – Let’s face it, if you’re going to obsess properly about your finances, you’ve got to start by reading about everyone else’s personal finances. Not only should you start your day with a personal finance shower (listen to Dave Ramsey while showering), you should eat a personal finance breakfast (Alphabits cereal, with the letters arranged to spell words like “BUDGET”, “MORTGAGE”, and “SUBPRIME LENDER”).

4. Get A Little on the Side – You’ve probably been faithful to your paycheck for a long time. You’ve had eyes for it alone, and it was the apple of your eye. But recently, you’ve been getting bored with your paycheck, and you want to spice things up a little by getting some extra “dough” on the side. Be discreet, and your paycheck won’t know the difference.

  • Huge Discussion on Making Money on the Side – FatWallet.com’s members have come up with a gigantic list of things that you can do to earn some extra money. From the Truffle Shuffle (going hunting for valuable mushrooms in the forest of the Western U.S.A.) to mystery shopping and tutoring, there’s an idea in there for you.
  • 5 Ways to Earn Extra Cash in Your Spare Time – Get Rich Slowly has a short, but sweet, list of ways to earn extra money to pay off debts, save for vacations, or “move on up to the East Side”.

5. Fill Your Spare Tank – You’re in the middle of Creditville, driving your financial train into almost certain ruin, running on fumes, and thinking, “I’m doomed.” Suddenly, you remember that your Financial Train of Doom has a spare tank, and you’ve got enough to get back to Wealthsville. You’re saved!

  • Dave Ramsey Baby Step #1 – Gather Little By Little talks about how to save your financial train from ruin by filling your “spare tank”. Say goodbye to bounced checks, overdraft fees, and running out of cash at just the wrong time. As Martha would say, “It’s a Good Thing.”

6. Send Your Money Back to School – It’s your money’s high school graduation day. The sun is shining, the birds are chirping, and it’s thinking to itself, “Money, you’ve learned how to earn interest in a bank account. You’re never going to have to learn another thing in your life.” Unfortunately, when your money grows up, it realizes that all the other people’s money has gone on to learn how to grow larger in the stock market, or come back bigger after living in a CD for a while. Don’t worry, your money’s not dumb, just ignorant – it can be taught.

  • About.com’s Personal Finance – This is one of the largest sites about personal finance, with over 2,000 articles (I know because I have actually gone through all of them!) about personal finance, investing, banking, saving for retirement. Start clicking, keep reading, and teach your money how to grow itself.

7. Get Snooty – Buy fine wines, Chateaux on the Loir River, and one-of-a-kind gold coins. Shun the lowbrow “investments” such as a brand new car, the hottest new computer (which is already outdated), and a surround sound system. Remember, you are the upper crust, who buys assets that appreciate in value (or at least those that don’t immediately depreciate), not some philistine who only values whatever has appeared in the latest Gamer’s Monthly magazine. Break out your antique cuff links and monocle, and start spending that money where it’ll do the most good.

8. Get Cheap – After investing in all your fine wines and snooty French houses, and socking away your gold coins, you realize that you don’t have much money left to spend…or you have the money, but you just don’t want to spend it. Continuing in the fine tradition of millions of American millionaires, decide to drive your car and maintain it well, stay in the same house even though you can afford better, eat generic cereal because it tastes the same as the brand name stuff, and shop at Wal-Mart instead of The Gap.

9. Don’t Be Like the Muffin Man – Have you seen The Muffin Man? Well, nobody has, not since he got audited by the IRS and lost his Drury Lane bakery because he didn’t keep good records. The Gingerbread Man ended up buying his business at a sweet discount because The Muffin Man had to scrape up cash, quick. When you go up against the Tax Man, you’d better make sure you’ve got your ducks (records) all in a row.

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How to Use a Grocery Price Book

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Grocery Price Book Resources

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I just read a great article at Get Rich Slowly about how to reduce your grocery spending by using a grocery price book.  You can find Get Rich Slowly’s great grocery price book post at the link below: Use a Grocery Price Book to Slash Your Food Spending I won’t attempt to duplicate the article, […]

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I got this letter from one of my visitors.  My daughter sent me an address for your website. I am very interested in obtaining help in managing my debt. I want to become debt free… however my husband and I don’t always agree on the method. Purhaps some guidance would benefit both of us… releasing […]

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A Simple Wealth-Building Tip

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