Pawning vs Selling | The pros and cons of each explored

Many people pass by the windows of pawn shops in their communities all the time without ever considering going inside. They have never had the need to learn the difference between pawning vs selling, much less the pros and cons of each. Although the movement of many pawn shops to the internet has boosted the number of people who shop for bargains at pawn shops, many are still in the dark about how the system works.

Unlike retailers, pawn shops get the merchandise they sell from the items that people sell or pawn. Although both processes lead to merchandise in the store, they happen in very different ways. When you decide to take something to a pawn shop to get fast money, you will need to know the difference to get the best deal for you.Pawning vs Selling


Pawn shops don’t buy just anything that you might have to sell. Some of the most common items they handle are jewelry, electronics, power tools, and musical instruments. These are items that are highly desirable and easy to sell. The pawn shop’s goal is to sell items as quickly as possible; not to let them stay on the shelf.

The item that the person sells to the pawn shop must be of good quality and in good working condition. It should also have all of its parts, including cords to operate it. You take the item you want to sell to the store and tell them you are interested in selling it. If they are interested in buying it, they will make an appraisal to determine the item’s value. Next, they will make you an offer on how much they will pay. If you agree, they will give you the money in cash and take possession of your item.


A pawn is a type of short-term secured loan that lacks some of the disadvantages of other types of loans. When you pawn something, you use it as collateral to get a loan. The pawn shop keeps your item until you pay the loan back. Then they return it to you.

If you fail to make your payments, the store takes possession of your item and you don’t get it back. They will sell it to customers to make back the money that they loaned you in addition to a small profit.

Pawn shops typically accept the same types of items for pawn that they buy because they sometimes end up having to sell them. They want things that people are likely to buy quickly so that they can make money fast.

Pawning vs Selling: Which Is the Right Choice for You?

Most of the time, people decide to pawn something when they need money for an emergency. They don’t have a credit card to pay for a car repair or they don’t want to borrow money from a family member to go to the dentist. They can pawn something of value and get the money they need without adding to their overall debt.Pawning vs Selling

Sometimes people sell something to a pawn shop for the same reasons that they pawn it. The difference is often that they don’t care if they get the item back if they sell it outright. If it is something they want back, they will get a pawn loan instead.

The biggest difference between pawning vs selling is that when you sell, you forfeit your item from the start. You know you aren’t going to get it back. It’s just like selling something at a yard sale. You take the cash and the person making the purchase walks away with their item.

When you pawn something, you don’t forfeit it until you fail to repay your loan. Most people who make the choice to pawn don’t intend to give the item up. An estimated 85% of all pawn loans get repaid and the borrower gets their item back. Most of the other 15% run into other financial problems and don’t have the money they need to pay the loan. Some also change their minds about the importance of the item and decide not to pay the loan.

Another difference is the amount of money you will get for your item. Sometimes pawn shops pay more for the items they buy outright than they will loan. That means you will have to decide which is more important to you; getting more money or having your item returned.

Selecting the Right Item

If you have just cleaned out the garage and have some items of value you no longer want, selling them to a pawn shop is a fast and easy way to make some money. Just make sure they fit into their list of accepted items and are in good working order.Pawning vs Selling

One of the most common items accepted by pawn shops is gold jewelry. Gold is always valuable and in demand. What makes it such a good item for selling is that it doesn’t have to be intact. If you lost one of your gold earrings or broke the clasp on your gold necklace, you can still sell the pieces as scrap metal and make some serious money. Some people even sell dental fixtures that they have tucked away in a drawer!

Sentimental value does not enter into the process as far as how much cash you can get for an item. It does, however, make a difference to the owner. The fact is that there will be times when your need for money gains priority over everything else. When it does, you may have to pawn an item with a lot of sentimental value and hope you can meet the terms of your pawn loan. If this is the case, make sure you understand your options and have lots of time to pay. Otherwise, you could end up losing an important heirloom that can’t be replaced.

If you have a choice, don’t pawn a sentimental item because you are certain that you will pay back the loan. Try to find something else on the list of accepted items that you can pawn or sell. The best way to decide if you should sell or pawn something is to determine if losing it will be a real sacrifice.

Pawning Vs Selling: A Side-By-Side Comparison



You get to keep your item as long as you meet the terms of your loan You forfeit your item at the start of the process
You may get less cash than if you sell the item outright You can get a little more cash
You have to pay back your loan before you get the item back You can get money that you don’t have to pay back
You still risk losing your item if you can’t repay You can sell items for scrap that have no sentimental value
There is no risk to your credit score if you can’t repay your loan There is no risk credit risk involved
You get your money on the same day that you pawn it You get your money on the same day that you sell it

You can see from the table above that there are some advantages that both pawning and selling have in common. For example, neither choice poses a risk to your credit score. Other types of short-term loans do. For example, if you take out a payday loan or borrow money against your credit card, you have to repay the money on a tight deadline.

When you pawn or sell something to a pawn shop, you never end up with an unpaid debt. Even if you fail to pay a loan on something you pawn, you simply lose the item. The pawn shop sells your item to recover their money and nothing is reported on your credit report. That’s what makes pawn shops one of the safest ways to get fast money.

Another thing that pawning and selling share in common is that you get your money on the same day you take the item in. If you have ever dealt with a financial institution, you know that the loan process is a slow and tedious one. Even the simplest online payday advances typically take a minimum of 24 hours to deposit money into your bank account. It can take much longer when they have to verify your bank account.

Another problem is that you give the online company access to your bank account and personal information. It’s left up to them when money is deposited into your account and when they take the payments back out.

When you pawn or sell something, you get the cash in your hand. You never have to reveal vital financial information or worry that the pawn shop will take money out of your account. You have control over the process from start to finish and you get the money you need when you need it!

Why the Right Pawn Shop Matters

The bottom line is that some of the pros and cons of pawning vs selling all come down to what the pawn shop is willing to do for you. One of the most valuable services they can offer is extended loan repayments.

Pawn stores must obey state and local laws on the minimum amount of time they give customers to repay loans. That time frame varies between 30 days and 120 days. The latter is true in California. Nearly four months might seem like a long-term when you first make your agreement. Having more time to pay is another advantage to pawning that may mean the difference in whether you get your item back.

Another way that the pawn shop can help is to offer you more money on the items you want to pawn or sell. Sometimes people simply sell or pawn items that they don’t want any more to get them out of the way. It’s a good way to get some extra cash and clear out some space.Pawning vs Selling

More often, people turn to the pawn shop when they need money for something important. Their only option might be to pawn or sell something that is of both monetary and sentimental value. Taking it to a pawn shop that pays more is more likely to get them the money they need. It could also mean the difference between being able to pawn the item and get it back later.

The Modern Pawn Shop

In the past, the average person never considered the option of pawning of selling at a pawn shop. They thought that these were shady places where thieves brought their stolen items to get rid of them. Pawn stores were also thought to be devious and unfair to their patrons.

Today, a growing number of people know that none of this is true. Pawn stores do a legitimate business that is beneficial to them and to the customers they serve. They deal in quality items and make it easier for people to get the money they need and to pay back their loans.

Granted, not all pawn shops are equal. Some offer only the flexibility that the law demands. If you are one of the people who is considering pawning or selling something for the first time, start by getting the facts. Know what you can get for each option and the risks of each.

Monte De Piedad takes pride in playing an active role in our community. We give our customers more flexible options to make the choice between pawning vs selling an easier one for them. We pay the guaranteed highest prices and offer flexible renewals on pawn loans, including unlimited renewals on jewelry loans. You can also pay the interest on your loan if you don’t have the full amount and still keep your items.

Contact us today if you have any questions. Stop by any of our 13 pawn shops in San Diego to learn more. We have the answers you need to make the best decision for your needs.